City of Sydney Investigates Airbnb and Stayz Restrictions Amid Housing Crisis

The City of Sydney will investigate possible restrictions on Airbnb, Stayz and other short-term rental platforms, including a potential ban on investment property listings in some inner-city suburbs, amid ongoing concerns about housing affordability and rental supply.

Councillors voted this week to support a Greens-led motion calling for a review of existing short-term rental rules applying to platforms including Airbnb and Stayz. The investigation will examine whether temporary bans should apply in suburbs where rental vacancy rates fall below a set threshold.

The proposal follows concerns that the current statewide cap of 180 days per year for non-hosted short-term rentals in Greater Sydney is not being adequately enforced and is failing to return housing stock to the long-term rental market.

The review could apply to 11 suburbs, including Darlinghurst, Surry Hills and Pyrmont.

Greens councillor Sylvie Ellsmore told the ABC that the current system was contributing to housing shortages in inner Sydney.

“We have residential properties that should be homes for people who live and work in our city being turned into de facto hotels,” she said.

The motion also requests more detailed information about ownership structures and the scale of commercial short-term rental operations in the local government area.

The proposal comes amid wider debate in New South Wales over housing supply, rental affordability and tourism accommodation. Similar restrictions on short-term rentals have already been introduced in other parts of Australia, including Byron Bay and Western Australia’s City of Busselton.

NSW Premier Chris Minns said any changes would need to consider possible effects on tourism and the visitor economy.

Industry groups have criticised the proposal. Stayz said existing state regulations were sufficient and argued that additional local restrictions would create unnecessary complexity for property owners and visitors.

The City of Sydney investigation is expected to report back to council at a later date with options and recommendations for possible regulatory changes.