Posted on October 15, 2018 by

UPDATE – proposed planning framework for Short-Term Rental Accommodation available for comment

The Department of Planning & Environment (Department) has recently released for public comment an Explanation of Intended Effect (EIE) regarding proposed amendments to the planning rules relating to short-term rental accommodation (STRA) in New South Wales (NSW).

Amendments to existing planning instruments will establish the state-wide planning framework that will form part of the regulatory framework for STRA in NSW that is expected to commence in 2019.

The key amendments include:

• providing a land use definition for this activity, to be known as ‘short-term rental accommodation‘,
• making it clear that ‘short-term rental accommodation‘ is not a form of ‘tourist and visitor accommodation‘,
• making it clear that STRA will be permissible in all zones in which dwellings are permissible,
• introducing specific provisions and required development standards so that STRA is permitted as exempt and complying development, and
• introducing minimum fire safety and evacuation requirements for individual premises used for STRA.

We have discussed other aspects of the regulatory framework, namely amendments to strata and fair trading legislation, in previous blog posts from July and August 2018.

Amendment of existing planning instruments 

The EIE explains that the new state-wide planning framework for STRA will be given effect through amendments to existing planning instruments including the Standard Instrument (Local Environmental Plans) Order 2006 (Standard Instrument) and the State Environmental Planning Policy (Exempt and Complying Development Codes) 2008 (Codes SEPP).

Upon commencement, the state-wide planning framework for STRA will automatically apply to all councils in NSW, including those with existing provisions regarding STRA.

The Department intends to liaise with councils whose local environmental plans have existing provisions regarding STRA to ensure a suitable period of transition.

Introduction of land use definition for STRA 

Arguably, the most significant proposed amendment is the introduction of a land use definition for STRA in the Standard Instrument.  The proposed new definition for STRA is:

‘the commercial use of an existing dwelling, either wholly or partially, for the purposes of short-term accommodation, but does not include tourist or visitor accommodation.’

In addition to this, a note will be added under the existing definition of ‘tourist and visitor accommodation‘ to make it clear that it does not include ‘short-term rental accommodation‘.

It is intended that the newly defined STRA land use will be permitted in all zones where dwellings are permissible.

This new land use will enable the use of a dwelling for STRA as a part of its residential use where the dwelling has a current development consent or existing use rights for its use as a dwelling, and no alterations or additions are required for STRA use.  STRA is also intended to be permissible in secondary dwellings.

However, so that they continue to meet their intended aims, STRA use will be excluded from:

• some forms of residential accommodation, such as boarding houses, seniors housing and group homes, and
• ‘affordable rental housing’ approved under State Environmental Planning Policy (Affordable Rental Housing) 2009 and State Environmental Planning Policy No. 70 Affordable Housing. 

Introduction of standard pathways for STRA 

It is also proposed that the Codes SEPP will be amended to include STRA as exempt and complying development.  These pathways will be based on different levels of risk and impact in connection with a combination of factors including whether a host is present on site overnight, whether the property is on bushfire prone land, whether the property is in Greater Sydney, and the days of STRA operation in a calendar year.

Exempt development 

It is proposed that STRA will be exempt development:

• for up to 365 days per year when the host is present onsite overnight, and
• when the host is not present and the property is not on bushfire prone land: for no more than 180 days per year in Greater Sydney and for up to 365 days per year outside of Greater Sydney.  However, Councils outside Greater Sydney will be able to reduce the number of days that STRA use is permissible to no less than 180 days per year, according to local needs.

Complying development 

It is proposed that STRA will be complying development when the host is not present and the property is on mapped bushfire prone land.

The following specific criteria will apply to STRA as complying development on bushfire prone land:

• the land must be certified as being no more than the Bush Fire Attack Level BAL-29 risk rating, and
• where a property exceeds BAL-29, a development application would be required to undertake STRA.

It is proposed that the general requirements for exempt and complying development will apply to STRA together with the following additional criteria:

• the current use must be lawful and permissible under an environmental planning instrument applying to the land and in a building approved for residential accommodation,
• the subject building must comply at all times with all relevant planning, building, strata, fire safety and health regulations,
• the STRA activity does not authorise any building works other than the proposed specified safety standards. As such, no alterations or additions will be permitted to the building unless otherwise exempt. Any building works would be required to follow existing approval pathways,
• STRA must not cause contravention of any existing condition of the most recent development consent that applies to the building,
• STRA must comply with relevant requirements under a strata scheme, and
• the dwelling must comply with the proposed minimum fire safety and evacuation requirements for individual premises used for STRA.

It is also proposed that minimum fire safety and evacuation requirements will be introduced for individual premises used for STRA.

You can make a submission to the Department on the proposed planning framework until 16 November 2018. For more information, visit: www.planning.nsw.gov.au/STHL

We will keep you informed in relation to further developments.

To discuss this blog or any planning and environment matter, please contact Carlo Zoppo, Partner on 8235 9705 or Sophia Urlich on 8235 9708.