You wouldn't think renting out a room in your home or the
granny flat out the back to holidaymakers or a student would merit
a $1.1 million fine, but that is what some councils reckon.
A man in the inner Sydney suburb of Annandale was shocked when
he received a letter from his local council threatening him with a
massive penalty for putting his home on the holiday rental website
A neighbor had complained about the coming and goings at his
home. The council responded by threatening him with a fine for
breaching zoning laws as he hadn't got permission to run what
they said was a hotel style business.
A woman in Randwick was given ten days to respond to a council
threat of a $1.1 million fine plus $110,000 ever day she continues
to operate an "unauthorised" bed and breakfast.
More than 10,000 homes in Sydney are offered on Airbnb but The
Sydney Morning Herald found just six Sydney councils allowed
short-term rentals in some areas - and most required permission
from the council.
Stacks Law Firm lawyer Michael McHugh, an accredited specialist
in property law, says the laws governing renting out rooms in homes
or granny flats on apps and websites such as Airbnb are confusing,
undefined, inconsistent and need to be fixed.
"Some councils think short term rentals break zoning and
building laws, while others think they might breach health and
safety regulations for bed and breakfast accommodation," Mr
"Tens of thousands of people around the country are
offering their home or empty rooms to let for travellers through
websites. The hotel industry might not like it, but many people
love hosting travellers and the money helps household incomes.
"Neighboring property owners and tenants have a right to
quiet enjoyment and there are safety and other issues associated
with short term letting so councils do need to set and enforce some
rules. However there's also something to be said for the old
mantra that 'the punishment should fit the crime'. Some of
the action being threatened by councils is just way over the
Mr McHugh says it is time for the government to step in and
bring uniformity and certainty to the laws governing short term
"Even though there hasn't been a successful prosecution
as yet, letters threatening million dollar fines are a heavy-handed
and intimidating response. Airbnb and home letting are now a
popular fact of life, and we need clear, uniform and fair laws that
allow home letting but ensure it is done safely and without
"Short term home letters would be best to get experienced
legal advice before getting a nasty letter from council," Mr
McHugh said. "Every council is doing something different and
it will be some time before there's consistency across local
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