On 9 April 2021, the NSW government announced a new statewide policy for Short-Term Rental Accommodation (STRA) including the the Environmental Planning and Assessment Amendment (Short-term Rental Accommodation) Regulation 2021 and State Environmental Planning Policy Amendment (Short-term Rental Accommodation) 2021 which introduced a number of important reforms for the industry. These are scheduled to take effect on 1 November 2021.
The new STRA legislative regime will supersede all previous short-term accommodation planning laws in NSW including existing ad hoc local council regulations on the subject-matter.
Relevantly, the NSW government has implemented the following reforms to the STRA:
New Statewide Regulatory Framework for STRA
The new STRA planning policy framework introduces a new definition for STRA; namely, hosted STRA and non-hosted STRA.
Hosted STRA means a short-term rental accommodation provided where the host lives on the premises during the provision of the short-term letting.
Non-hosted STRA means a short-term rental accommodation provided where the host does not live on the premises during the provision of the short-term letting.
The new STRA provides an exempt development pathway for Hosted STRA in a dwelling and non-hosted STRA in a dwelling.
A Hosted STRA in a dwelling is permitted to engage in short-term letting for a maximum of 365 days per year.
A Non-hosted STRA in a dwelling is permitted to engage in short-term letting for a maximum of 180 days per year in Greater Sydney and other nominated regional NSW local government areas and 365 days per year in all other locations.
However, in calculating the number of days a dwelling is used for non-hosted STRA, any bookings for a consecutive period of 21 days or more by the same person is not counted towards the annual day cap.
Fire Safety Standards for STRA Dwellings
Under the new STRA, dwellings used for short term letting will need to comply with the new Short-term Rental Accommodation Fire Safety Standard (Standard) pursuant to Division 7D of the Environmental Planning and Assessment Regulation 2000.
In summary the Standard requires all STRA dwellings to comply with upgraded and stricter fire safety standards, including but not limited to:
- Installation of an evacuation plan;
- Installation of interconnected smoke alarms;
- Registration with the NSW government-mandated STRA register to confirm compliance with the new fire safety standards;
- Provision of an information sheet by STRA hosts to guests on general emergency advice regarding the meanings of total fire ban, different fire warning levels and emergency service broadcasts and contacts etc; and
- Introduction of minimum fire safety standards for STRA dwellings and associated penalty notice offences for non-compliance.
Registration on the STRA Register commenced on 10 April 2021 to allow STRA hosts to register their dwellings before the commencement of the new STRA planning rules on 1 November 2021.
Registration on the STRA Register is a mandatory requirement prior to a dwelling being used for STRA in NSW. Registration also requires the registrant to confirm that the STRA dwelling complies with the Standard.
Registration on the STRA Register allows the NSW government to track the number of days a dwelling is used for STRA for compliance purposes.
Code of Conduct for STRA Industry
The new mandatory Code of Conduct (Code) and the accompanying Amendment (Short-term Rental Accommodation) (No 2) Regulation 2020 commenced on 18 December 2020.
The Code creates new minimum standards of behaviour and requirements for all industry participants including:
If you have questions or need assistance in this developing area of the law, please contact our experts at Bannermans Lawyers at firstname.lastname@example.org or call us on 02 9929 0226.
Prepared by Bannermans Lawyers
11 May 2021