‘Cash to be made’ but short-stay accommodation regulation on the cards
An inner-city council is following the Adelaide City Council’s lead in charging commercial rates for short-stay accommodation, meanwhile regulating the sector is on the Legislative Council’s radar.
Unley Council has proposed changing how short-stay rental accommodation properties, such as houses used for Airbnb or Stayz, are rated in its 2025-26 budget.
The change is proposed to address the limited availability of long-term rental properties in Unley and to ensure a fair rating system between traditional accommodation providers like hotels and short-stay accommodation.
According to the City of Unley’s draft budget, in 2024-25 the commercial rate was 2.57 times higher than residential properties.
For example, a property valued at $1,000,000 paid residential council rates of $1797 per annum last financial year.
If that property is rented out through Airbnb for most of the year, then this year they’ll have to pay commercial rates of approximately $4611 per annum.
Unley Mayor Michael Hewitson said the proposal to reclassify rates “simply aims to level the playing field and to encourage some property owners to consider making housing available to longer-term tenancies”.
“In the current climate we are seeing a lack of longer-term rental properties, with some property owners using homes to maximise income by offering the short-term rental of their properties,” he said.
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“The rise in the number of Airbnb-style accommodation reduces the number of rental properties for families and other people looking to secure a home to live in within the City of Unley. This also impacts other businesses such as hotels and motels, who pay commercial rates.”
Unley Council will review community feedback on the rate changes, which they are currently consulting on via their website, before making a decision that would come into effect from July 2025.
The Adelaide City Council made a similar change in its 2024-25 budget, which applied the new commercial rates to 205 properties out of 900 short-stay accommodations.
The remaining 695 properties don’t meet the Adelaide City Council rating criteria because they are available to rent for short stays for less than 90 days in a year.
Greens MLC Robert Simms chairs the Legislative Council’s Select Committee on Short-Stay Accommodation and said a problem they’ve heard so far is around the availability of data for councils to rate these properties.
The committee heard from academics who suggested the government should require platforms to disclose the number of listings they have and require individual homeowners using platforms like Airbnb to register through some central system.
The data would be shared with local councils so the council can increase its rates accordingly, depending on what’s happening in the housing market at any given time.
Currently, there is no such data collection, and the Adelaide City Council has paid for research to identify short stay rentals that meet the conditions of its rating structure.
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Simms said the committee has been pointed to examples in Tasmania and other states that are regulating short-stay accommodation in this way.
Adelaide City Councillor Henry Davis said that short-stay accommodation plays an important role in the state’s tourism industry.
“We want to have the COP, you know, 50,000 people come to the city, where are they staying?” Davis said to the Adelaide City Council’s City Finance and Governance Committee last night.
At the Adelaide Economic Development Agency Business Summit yesterday, Premier Peter Malinauskas suggested “there’ll be some cash to be made” on Airbnb if Adelaide secures its bid for the international climate conference COP31.
Simms said the committee’s work and the discussion about regulating short-stay accommodation is not a binary debate.
“No one’s suggesting that short stay accommodation shouldn’t be part of the mix, that’s not what this discussion is about,” Simms said.
“Rather, what we’re looking at is, is there room for some level of regulation of the sector to make sure that we’re getting the balance right.”
Simms said most states around the country are working on regulating the sector, and there’s a recognition from short-stay operators and councils that SA lags behind when it comes to data collection and regulation.
“I have an open mind as chair of the committee, and we’re still in the process of hearing evidence,” he said.
“I do think it’s fair to say, though, that overwhelmingly, so far, most of the people who have appeared before the committee, including people in the short stay accommodation sector, have argued for some form of registration scheme.”
The committee is expected to finish hearing evidence in June, with recommendations expected later in the year.
