In towns where thousands of homes are Airbnbs, renters want a tax

Residents in Australia's Northern Rivers region, particularly those displaced by the 2022 floods, are facing a severe housing crisis, with many struggling to find affordable long-term rentals. Louise Dwyer and Mike Crouch, currently living in a temporary housing village in Mullumbimby, exemplify this struggle. They recall a time when rentals were accessible and affordable, a stark contrast to the current market where a two-bedroom house could cost between $800 and $1,000 per week.

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Prior to the floods, we had really great affordable housing … for many, many years.

With the temporary pod villages set to close by the end of the year, couples like Dwyer and Crouch are scrambling for secure accommodation, resorting to booking caravan parks and hotel rooms after their leases end. They support calls for a holiday rental levy, especially if the funds are directed towards housing support. "Locals are being pushed out; they're being priced out of living in their communities, which is really sad," Ms. Dwyer stated.

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If we were to get a two-bedroom house [now], we'd probably have to pay anywhere from $800 to $1,000 a week, which we don't have.

Homelessness NSW is advocating for a levy on short-term holiday rentals, estimating it could generate around $50 million for housing support and incentivize long-term rentals. They point to Victoria's model, introduced last year, where a 7.5 percent tax on short-stay rental revenue raised $85 million for social and affordable housing. "People are finding it really hard to find rental accommodation in the private rental market," said Dom Rowe, CEO of Homelessness NSW. "And short stays basically take properties out of that long-term rental market and so makes it more difficult for people."

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Locals are being pushed out; they're being priced out of living in their communities, which is really sad.

However, the analysis of rental listings by Homelessness NSW has been contested. The advocacy group compared long-term rentals on realestate.com.au to short-stay listings recorded by Destination NSW, finding significantly more short-stay options. Catherine Shields, a board member for the Australia & New Zealand Short Term Rental Association, argued that this analysis is not "comparing apples with apples," suggesting the data may not accurately reflect the rental market dynamics.

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In the last year, they were able to raise $85 million to go to those most in need, so that's a pretty impressive policy setting that we know works as it's worked in that other jurisdiction.