Introduction

The Strata Schemes Development Act 2015 (NSW) introduced a formal process for strata renewal in New South Wales, enabling owners corporations to collectively decide on the sale or redevelopment of their entire strata scheme. This legislative framework provides a structured pathway for owners considering significant changes, often driven by factors like ageing buildings or redevelopment opportunities.

Navigating this process involves several distinct stages, from the initial proposal and formation of a renewal committee to meeting specific requirements, such as achieving support from at least 75% of lot owners. Understanding these steps, along with the provisions for owner compensation and the role of the Land and Environment Court, is crucial for all parties involved in managing or participating in a strata scheme renewal.

What is short term rental accommodation?

For strata owners contemplating listing their property on platforms like Airbnb for durations under three months, understanding the nuances and legalities of short-term rentals is crucial. Simply put, short-term rental accommodation is the commercial lease of a legally constructed dwelling for periods less than three months. Such arrangements typically fall into two categories:

1. hosted rental accommodation, where the owner is present during the guest’s stay, and
2. non-hosted rental accommodation, where the property is entirely at the guest’s disposal.

1. What is ‘hosted’ rental accommodation?

Hosted short-term rental accommodation refers to situations where the host or landlord lives on the same premises as the guest during their stay. For example:

• Letting out a section of your strata property on Airbnb while you occupy another part of the same building.
• Renting a separate space—such as a granny flat—on Airbnb when you remain on the property.

In essence, your ongoing physical presence on the property throughout the rental period is the defining characteristic of hosted accommodation.

2. What is ‘non-hosted’ rental accommodation?

Non-hosted short-term rentals occur when the host or landlord does not share the premises with the guest. Common examples include:

• Individual units within a building that employs an on-site manager or concierge.
• Leasing your strata apartment on Airbnb while your primary residence is located elsewhere.

Simply put, the absence of the property owner during the guest’s occupancy distinguishes a non-hosted arrangement.

Can you rent your apartment in a strata property on Airbnb for a short-term?

Can you rent our your strata apartment for a short-term on Airbnb? Well, yes you can! All legally constructed dwellings that are allowed to be used as ‘residential accommodation’ in all land-use zones can be let our for short-term rentals. Some general requirements for letting out your dwelling are summarised below:

• Residential classification:
  • Must comprise or be part of residential accommodation.
  • Must not be a boarding house, group home, hostel, rural workers’ dwelling, seniors housing, co-living housing, or any refuge/crisis accommodation provided (wholly or partly) by a public or local authority.
• Planning consent:
  • Permitted on the land (with or without development consent) where it is located.
• Registration and fire safety:
  • Registered under the Environmental Planning and Assessment (Development Certification and Fire Safety) Regulation 2021 (NSW).
  • Either holds a current fire safety certificate/statement, or no fire safety measures are currently required, implemented, or proposed.
• Fixed structure:
  • Not moveable in nature (e.g., RV or trailer home).
• Lawful purpose:
  • Used only for a lawful short-term rental purpose.

Your strata apartment likely already ticks all the above. Nonetheless, before you decide to put up your apartment on Airbnb, you should consider contacting your local council for development consent information and go through the by-laws formed by your owners corporation.

Can the owners corporation restrict or prohibit short-term rental of your strata property?

Can the owners corporation restrict or prohibit short-term rental of your strata property?

As per Section 137A of the Strata Schemes Management Act 2015 (NSW), the owners corporation may:

• Adopt by-laws that regulate and limit short-term rental accommodation within the strata scheme.
• Ban short-term stays in lots that are not the host’s principal place of residence.

However, if your strata apartment is your principal place of residence—whether you’re living there during the rental period or only temporarily away—the owners corporation cannot impose a complete ban on your short-term rentals.

Before Section 137A came into force, the legal position was uncertain. In Estens v Owners Corporation SP 11825 [2017] NSWCATCD 52, the NSW Civil and Administrative Tribunal invalidated a by-law that prohibited all short-term letting, finding that the owners corporation lacked the power to enact such a restriction.

While no other NSW cases have directly settled this issue, courts in similar jurisdictions have supported owners corporations’ rights to regulate short-term rentals. For example, in O’Connor v The Proprietors, Strata Plan No. 51 [2017] UKPC 45, the Privy Council upheld a by-law banning short-term letting under a statutory scheme akin to NSW’s.

Note: Section 137A commenced on 10 April 2020. Any by-law restricting short-term rentals adopted before this date must nevertheless comply with Section 137A—any inconsistent provisions are now invalid.

For how many days can short-term tenants use your property?

The number of days you can rent out your strata apartment on Airbnb depends on whether you live on the same premises as your guests.

• Hosted short-term accommodation
  If you reside on the property throughout the rental period, you may rent your dwelling throughout the year without any day-limit.
• Non-hosted short-term accommodation
  When you do not live on the premises during a guest’s stay, you may rent for up to 180 days in any 12-month period.

Importantly, when tallying the 180-day cap for non-hosted rentals, you do not count any continuous let of 21 consecutive days or more to the same person.

Where does your strata apartment need to be located to rent using Airbnb?

According to the State Environmental Planning Policy (Housing) 2021 (NSW), only dwellings in specified areas may be let out for short-term stays. The prescribed locations are:

• Greater Sydney region (excluding the Central Coast local government area)
• Ballina local government area
• Byron Shire local government area
• Clarence Valley local government area – land shown edged heavy black on the Clarence Valley Short-term Rental Accommodation Area Map
• Muswellbrook local government area – land shown edged heavy black on the Muswellbrook Short-term Rental Accommodation Area Map

If your strata apartment falls within any of these areas—and you satisfy all other statutory and by-law requirements—you are eligible to rent it on Airbnb for short-term accommodation.on.

Are there any compliance requirements to rent out your property as an Airbnb?

Before advertising your strata apartment on platforms like Airbnb, ensure you satisfy the following obligations:

Fire and safety compliance
Verify that your strata property meets all applicable fire and safety standards—such as holding a current fire safety certificate or statement—before hosting guests.

STRA registration
Register your property on the Department of Planning, Industry and Environment’s STRA register and pay the required fees. This must be completed before you advertise or offer it for short-term rental.

Code of Conduct for the Short-term Rental Accommodation Industry 

The NSW Government’s new Code of Conduct for the Short-term Rental Accommodation Industry (the Code) applies to all participants—booking platforms, letting agents, hosts, guests and facilitators—and sets mandatory obligations for stays of three months or less. As a strata property owner renting on Airbnb, you are categorised as a host. Your main obligations under the Code include:

• Insurance: Hold valid cover for third-party injury and death liability.
• Accurate representation: Ensure the property matches the standard advertised.
• Cleanliness & safety: Maintain a clean environment and comply with all safety requirements.
• Emergency contact: Provide guests with a clear point of contact for emergencies.
• Risk notification: Inform guests of any potential hazards associated with the property.
• Complaint handling: Respond promptly and appropriately to any guest complaints.
• Booking/property changes: Notify guests of alterations to their booking or to the property.
• STRA register compliance: Register the property and owner on the short-term rental accommodation premises register, and comply with all other applicable laws and regulations.

Are there any penalties for not complying with the applicable laws?

TThe Code sets out disciplinary actions and penalties if a strata landlord fails to comply with the applicable laws. In such cases, NSW Fair Trading may take the following enforcement measures:

• Warnings and directions: Issue warnings or direct the host to take—or cease—specified actions.
• Monetary penalties: Levy fines for breaches of the Code.
• Strike system: Record a ‘strike’ against a host, their premises, or a guest for serious infringements.
• Exclusion Register: List the host, guest or premises on the Exclusion Register, resulting in a five-year industry ban after two serious strikes within a two-year period. Additionally, anyone charged with a criminal offence—when it is in the public interest—may be temporarily excluded until proceedings conclude; upon conviction, they can be listed for a specified period or indefinitely.

Importantly, the Code mandates a fair procedure before any adverse action is taken against a host. It also provides for an appeals process against penalties imposed for breaches of the applicable laws.

Conclusion

Listing your strata apartment on platforms like Airbnb in NSW is permissible but involves navigating a specific regulatory landscape, including registration requirements, the Code, potential day limits, and owners corporation by-laws which may restrict or prohibit short-term rentals. Understanding these rules is crucial to ensure compliance and avoid significant penalties, such as fines or being listed on the Exclusion Register.

Given the complexities of short-term rental regulations and strata scheme rules, seeking professional advice is recommended to ensure you meet all obligations. If you need assistance understanding your rights and responsibilities as a host or navigating potential restrictions, consulting with experienced NSW strata lawyers can provide clarity and support. Contact PBL Law Group today for expert guidance on strata property matters.