If you want to rent out your property to short-term holiday
makers, as a bed and breakfast for overnighters or rent out a room
to backpackers you just might be heading for a nightmare clash with
your local council.
The Sydney Morning Herald reports some property owners are being
threatened with fines of more than a million dollars for renting
out rooms in their homes without having consulted council.
Some room renters are being ordered by councils to apply to
become official bed and breakfasts. But the B&B application
process could involve having to make expensive upgrades to your
home such as fitting commercial kitchens and extra bathrooms.
It centres on council planning controls. It would be wise to get
legal advice about controls in your particular area before you
embark on renting out rooms to travellers. This is particularly
worthwhile if you are using short-term accommodation websites such
as Airbnb and Stayz.com as councils
are also checking them to see who's doing what in their council
Another serious legal problem has emerged for people renting out
investment properties for short-term holidaymakers. Renting a house
near a beach or park for a weekend or longer has been a holiday
tradition for generations of Australians. It's been a common
way for investment property owners to make some money while they
don't live in the property themselves. It brought in much
needed income for businesses in coastal towns.
However complaints from a neighbour about loud parties in a six
bedroom holiday home in Terrigal led to action in the Land and
Environment Court that has thrown this tradition into legal
uncertainty. At the centre of the legal argument is what
constitutes a "dwelling house" if no one lives there
longer than a week. The owner tried to satisfy the neighbours by
banning loud parties. However the judge ruled in favour of the
neighbours, finding letting a dwelling house that is used primarily
for short-term holiday rentals may require development consent
under the Environment Planning and Assessment Act
People who rent out their property for short-term holiday
rentals would be wise to get legal advice about whether they are on
secure ground. Many councils are allowing holiday rentals in
residential areas as it is a valuable part of the local economy.
But some councils are mindful of community concerns about noise and
are clamping down on the sort of activities that take place in a
short-term holiday rental.
The Department of Fair Trading has introduced a voluntary Code
of Conduct to promote standards for owners and guests to stave off
unpleasant neighbor disputes over noise.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Whilst option to purchase clauses are more in commercial properties, they are now being included in residential leases.
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