Australian rental market listings declined 18.9% in April, according to recent PropTrack data – the largest decline since December 2017. Now, there are calls for limits to be put on short stay accommodation as a potential solution to the problem.
Melbourne, Perth and Sydney are facing the toughest rental market conditions in the entire country, with total rental listings over the year falling 31.3%, 19.2% and 15.7%, respectively.
While some markets saw an increase in rental supply (mainly regional), total stock for rent remains significantly lower than at the start of the pandemic in both capital cities (-40.2%) and regional areas (-36.1%).
And with rental prices at the end of March 2023 sitting at a median of $500 per week in capital cities, an increase of 11.1% over the past 12 months, it’s like renters are being dealt a double blow.
The question of how to sustainably fix the rental supply issue and provide secure housing to the millions of Aussies who rent is now more pertinent than ever.
Is ending short-stay accommodation the answer?
“If the short stays industry is allowed to go unregulated, we just can’t have a healthy long-term rental market,” Gabrielle de Vietri Greens MP and State Member for Richmond said.
This has led the Greens to introduce a bill to parliament which would place strict regulations on the short stays industry in Victoria, with the aim to bring more properties back to the regular rental market.
“Some of the things we’re proposing is a 90-day cap on how many days someone can rent out a property on the short stays market,” de Vietri said.
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Many apartments, especially in the inner city, are used as Airbnb's so owners can also use them when they want. Picture: Getty
Similar restrictions have already been placed on short-term stays in the cities of London and Amsterdam.
If this bill was passed, it could mean thousands of short stay accommodation listings on sites like Airbnb would potentially return to the long-term rental market, helping to ease the current rental crunch.
However, many oppose the bill, including Robynne Young who owns two Airbnbs in the Dandenong Ranges and Mornington Peninsula.
Ms Young and partner Nick are using the income from these properties to self-fund their retirement.
“They’re taking away our livelihood,” she said.
“I think we lose sight of the fact the tourism industry is integral to the Dandenong Ranges [and] neighbouring communities rely on it for their existence.”
Experts suggest a nuanced approach
A more balanced approach is needed according to Dr Tom Alves from the Australian Housing and Urban Research Institute:
“This form of accommodation can be a positive contribution to local economies and tourism in some places. However, at the same time, it’s harder for low-income earners who are a permanent part of a community to access affordable rental houses,” he explained.
As a response to the rental crisis Airbnb last year proposed state and territory governments introduce state-wide registration schemes and codes of conduct.
If a cap is placed on short-term rentals, it could see investors leave the market. Picture: Getty
A tourism levy to fund housing and community projects, and a review of eviction protections have also been suggested by the accommodation listings site.
The NSW government has already introduced a 180-day cap on using empty properties for Airbnb-style letting in Sydney and other tourist hotspots.
And in October, the Queensland government announced an investigation into the impacts the short-term rental market was having on housing stock.
The long-term solution
Dr Alves suggested Australian lawmakers look to borrow from what the EU is doing and consider harmonised regulations across all states.
That could mean a nationwide cap on the number of days a property can be rented out on short-term accommodation sites, which may see more properties returning to the long-term rental market for the millions of Aussies struggling to find affordable rentals.