By Paul Birch, Noosa Heads
Should we be happy that Victoria has imposed a 7.5% levy on Airbnb style Short Term Accommodation?
Definitely Not!
All this does is legitimize STAs as valid, approved alternate accommodation. In reality, they are unstaffed, largely unregulated, unlicensed, commercial hotels in residential areas. They are overseen by (g)hosts! There are no “hosts” on site!
And some of these (g)hosts tend to manage tens to hundreds of properties.
From The Age, Sept 24th,2023:
“There are some “mum-and-dad investors” running Airbnbs, but there are also many people operating serious businesses.
According to data collection site Inside Airbnb, hosts “Paul and Dan”, for example, have 97 entire homes available for rent across Melbourne on Airbnb, while host Andrew has 102 entire homes available on the Mornington Peninsula.”
"Inside Airbnb", founded by an Aussie, is world renowned for its data collecting abilities. Let’s compare Airbnb with the traditional tourist accommodation in our area. And AirBNB is very happy to bleat on and on about wanting a level playing field to compete with existing tourist accommodation.
Tell ‘em they’re dreamin’. Consider:
Airbnb’s don’t pay GST
Income from Airbnb is looked upon by the ATO as “rental income” on investment property. So no GST payable.
Speaking of which, investment property has huge negative gearing tax benefits PLUS a HUGE 50% reduction in capital gains tax on sale of the property!!
So, at one end of the “playing field” these people talk about, we have the real hotels and real tourism accommodation with more moguls than a rough ski field whilst Airbnbs end is smooth as glass with the wind at their back.
So, the LAST thing we need is a State Government getting involved in what is a LGA or Local Government Area issue. And is able to be handled at the local level.
Just consider the enormous savings in bureaucratic red tape when local council representatives (who are locals and live within their communities) are able to speak face to face with residents whom they represent. They are acutely aware of the passion with which locals want to ensure their residential amenity, their safe, secure and peaceful existence in the residential areas in which they live.
Behold the results in New York City (LGA)
Why it matters: The change — which Airbnb has called a "de facto ban" — is one of the most significant moves a major city has made in recent years to curtail short-term rentals, coming after New Orleans issued new restrictions of its own in March.
Also, I just love “The Bottom Line “ at the end
Yes, but: Airbnb is a global booking powerhouse with strong financials, posting its most profitable Q2 on record this year as travel continues to rebound post-pandemic.
The bottom line: New York drew bucketloads of tourists well before short-term rentals were a thing.
Fewer such options might be a hassle for families looking for residential-style accommodations, but may not result in much more than a blip in long-term tourism numbers.
So, it would seem an LGA of all things achieved a ban, de facto or not. Even in the face of a High Court challenge.
And then, Kansas City
Kansas City (a LGA) will kick hundreds of rentals off Airbnb and Vrbo this week. But here in Australia, let's tax clients 7.5%...
It’s all due to Kansas City’s recent ordinance governing short-term rentals within city limits.
The new requirements for short-term rentals attempt to address years of complaints by Kansas City residents, many of them homeowners, who say the unchecked proliferation of these units harms the character of their neighborhoods.
Common concerns included noise complaints from rowdy gatherings and increased ownership by out-of-state investors profiting off tourist dollars rather than permanent residents putting down roots in the community.
Under the ordinance, booking platforms risk violating the city ordinance if they receive money from an unregistered rental location. Each day an unregistered rental unit operates can count as a separate violation, carrying a fine of up to $1,000.
“We are kind of stepping up our level of aggressiveness.”
From Bianca Hall in The Age newspaper, Sept 24th 2023
“We’re not immune to the problem here in Australia. As my colleague, Benjamin Preiss, and I wrote in February, there are almost 5000 homes in the Mornington Peninsula listed on Airbnb. One little house in Mount Martha – marketed as a “renovated coastal abode” – was booked by Airbnb customers for 255 nights last year; earning its owners, who also ran another 46 properties through Airbnb, $103,500.
Anyone hoping the Victorian government would follow suit would have been disappointed by Premier Daniel Andrews’ wet- lettuce announcement of a 7.5 per cent levy on short-stay
accommodation this week, with the funds to go directly to Homes Victoria to help fund social and affordable housing.
The premier, of course, is aware of all this. On Wednesday, he revealed regional tourism operators were continually bailing him up about the problems short-stays created.
“They invariably talk to me about the fact that they can’t find anywhere for their staff to live ... And if you can’t find a home for your staff, then you can’t open your business to its full potential.”
So, it would appear that he has completely ignored their pleas!
“Will the levy fix that? It’s highly unlikely. And in a further blow to regional areas carrying the burden of accommodation shortages, Andrews’ new statewide tax will override their ability to profit from short-stay providers, replacing local government- imposed fees in Bass Coast Shire, Frankston, Mornington Peninsula and, most recently, Warrnambool Shire.”
I would urge you to reread that last paragraph!
As I have mentioned, the State is akin to a Scorpion, always a “Sting in the Tail”.
And the best Victoria (a State Government) can do is a 7.5% tax/levy!! Which, by the way, isn’t to be enacted until 2025!
That’s a prime example of the (non) effectiveness of the State. And the next election is in 2026. Leaving their options open, probably.
There is a very apt Aussie aphorism which best describes that poor effort.
I urge you, particularly if you are affected by the scourge of STAs in your neighborhood/ community, to contact your local Councillors or any local groups active in your residential areas and have your say.
Editor's Note:
Do you have a view on the short term accommodation issue in Noosa? We would love to hear from you and are happy to post your contribution here anonymously. The more local stories we have, your personal experiences, the better. Please always cite sources whenever statistics are quoted. Use the form here or Email to: nnsnoosa1@gmail.com
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