A court case brought in the NSW Land and Environment Court last
week could threaten thousands of people who rent out their
investment properties or holiday homes to short term renters.
What began as a neighbour dispute over noise in the central
coast town of Terrigal has grown into a major test case for the
right of investment property owners to rent out their homes for
short periods such as a week or weekends.
The neighbour complained of loud and drunken parties next door
when the six bedroom house was rented out for school holidays and
The neighbour took the case to the Land and Environment Court
arguing the owner of the property should be prohibited from renting
it out on a short term basis. He told the court the noise of
drunken parties from next door was causing psychological damage to
The case hinges on the definition of "dwelling house"
as set out in the residential zoning rules of the local council.
The neighbor argues "dwelling" means a degree of
permanent occupancy, and argued if it is let out for parties on a
regular basis it is in breach of the Environmental Planning
Assessment Act and needs approval from the local council.
Michael McHugh of Stacks Business, the lawyer representing the
owner of the property, said if noise was the problem then the
neighbour should complain to police rather than seek to stop an
owner letting out their property.
"We argue a property does not have to have permanent
residents to be considered a dwelling house," Mr McHugh said.
He said his client bought the property as an investment to let out
to holidaymakers, and if she can't do that it would ruin
The owner didn't know it was being used for parties, and
since the neighbour complained about noise she's asked renters
to sign an agreement they won't use the house for noisy
"This case will have enormous ramifications for thousands
of property owners up and down the coast who rent out their
investment properties or holiday homes for short term stays,"
said Mr McHugh.
"It's a big industry not just for home owners but also
for local tourism."
The case continues and many investment and holiday home owners
are watching closely.
In a strange twist, the judge told lawyers for both sides that
she also owned a holiday home. The lawyers didn't object to her
hearing the case.
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