Airbnb Australia boss says restricting short-term rentals will not solve country’s housing crisis

A short-term rental juggernaut has hit back at claims it’s fuelling Australia’s property crisis.

The average Australian owner-occupier’s mortgage has soared to a record high of more than $636,000 off the back of climbing property prices, and there is little respite for renters, even if there has been a slowdown in rental price growth.

The median rental price for a house across Australia’s capital cities is $650, up 11.1 per cent year-on-year. Units are only $20 cheaper.

With rental vacancy rates across capital cities operating below 2 per cent, “tenants remain in a landlords’ market”.

“To shift conditions away from landlords and into a balanced market (a vacancy rate of 2-3 per cent), Australia needs between 33,000 and 66,000 rentals – an improvement from the 40,000 to 70,000 needed in the first quarter of 2024,” according to Domain’s latest rental report.

With property demand outstripping supply, the bigger profits of short-stay have become a target for state governments desperate for a solution.

Online marketplaces including Airbnb and Stayz have been accused of forcing up rents and taking houses off the market for people searching for a place to live.

Airbnb’s Australian boss Susan Wheeldon says that although regulation is needed, restricting short stays will not solve the housing crisis.

She highlighted data from a report released in February which found short-term rentals make up a tiny percentage of the country’s housing stock, and that up to 30 per cent of hosts “primarily use the income generated to make ends meet”.

“All of short-term rentals sit at around 1 per cent of overall stock in Australia,” Wheeldon said.

Byron Bay, a coastal playground to the stars, is one council making moves after placing a cap on properties being used as short-term rentals.

The town currently has 101 rentals listed, but 354 places are available on Airbnb.

From September, houses or units will be restricted to a maximum of 60 days use as short-term accommodation each year.

“We know we’re under assault from the platforms,” Byron Shire Mayor Michael Lyon said.

“It’s absolutely essential that we protect residential areas for residential uses.”

Wheeldon said the cap’s impact on jobs could be huge.

“You’ve taken a 10-month opportunity and changed it into two and that’s gonna have a really serious impact on employment,” she said.

WA is offering $10,000 to convince short-stay property owners to convert to long-term leases, with 457 applications made so far.

Victoria is imposing a levy to fund housing projects.

“It means everyone who’s coming into the area is helping to contribute back. We think 7.5 per cent is a little bit high — 3 to 5 per cent is about what we’ve seen benchmarked globally as best practice,” Wheeldon said.

Mandatory registration is one thing everyone seems to agree on to provide more accurate data in towns that rely on tourists, but also need somewhere locals can afford to stay and work.

Airbnb has launched City Portal to give partnering cities insight into local trends.

“They have full access to understanding where the properties are, how many nights they’ve been stayed in,” Wheeldon said.

It is for council’s eyes only, while the public has to live with whatever governments decide.