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OWNERS CORPORATION AMENDMENT (SHORT
STAY ACCOMMODATION) BILL 2016 (“the Bill”)
INQUIRY BY THE ENVIRONMENT AND PLANNING
COMMITTEE OF THE LEGISLATIVE COUNCIL
PARLIAMENT OF VICTORIA
Further Submissions in response to the speakers that gave
evidence at the Inquiry before the Committee on 24 March 2017
and 13 April 2017
From We Live Here Limited
The following further submissions form the position of We Live Here Limited in
relation to the Bill that is the subject of inquiry by the Environment and Planning
Committee of the Legislative Council.
Through our further submissions, we not only aim to provide effective policy
solutions that the government of the day has not considered, but also we seek to
highlight the needs to be addressed in order to balance the interests of Owners and
Residents and Owners Corporations with the ‘legitimate’ short-stay accommodation
industry and tourism sector.
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We Live Here Limited request these further submissions to be considered by the
Sub-Committee of the Environment and Planning Committee as part of its inquiry.
1.
Submissions from Airbnb
Mr. Brent Thomas, Head of Public Policy, Airbnb
Page 3 of evidence, 2nd paragraph from bottom
“In New South Wales, there has been a parliamentary inquiry chaired by a Liberal
Party member of Parliament, but also Nationals, Greens and Labour were on that.
They looked at this issue for 18 months and took evidence from all parties. They
unanimously – all four of those parties – came up with 12 recommendations,
including effectively a couple of recommendations that emulate the Victorian and
Queensland model: to crack down and target behaviour through an independent body
but not remove the right of people that live in a strata building from being able to
share their own home.”
This statement is inaccurate, misleading and prone to exaggeration.
On 20 April 2017, the NSW Government released its response to the final report of
the Parliamentary Inquiry into the Adequacy of Regulation of Short-Term Holiday
Letting.
In fact, the Liberal-led NSW Government supported only 3 out of the 12
recommendations.
Relevantly, the NSW Government has decided that it will not participate in the
management of the Holiday and Short-Term Rental Code of Conduct.
In addition, the NSW Government has committed to review the legislation
applicable to Owners Corporations within 5 years, with a focus on assessing the
impacts of short-term letting in the strata environment.
NSW Planning Minister Anthony Roberts and Innovation and Better Regulation
Minister Matt Kean have called for more consultation. The following quotes are from
the Sydney Morning Herald article published on 20 April 2017 –
https://www.domain.com.au/news/nsw-government-backs-away-from-makinghurried-decision-on-airbnbtype-rentals-20170419-gvo1ag/
“The inquiry recommendations make sense, but the regulation of short-term letting
needs broader engagement with the industry and the community to establish a model
that enables it to continue to flourish and innovate whilst ensuring the amenity and
safety of users and the wider community are protected,” Mr Roberts said.
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“It’s sensible to take time on a complex issue like this, which is why we are releasing
an options paper next month.”
“We don’t want a holiday accommodation market that’s so over-regulated it puts
people off coming here but the rights of residents who live near these properties must
be considered too,” says Mr Kean.
“While short-term holiday letting, if properly managed and respected by all parties,
can be a boost to the local economy, the need to protect people’s rights to the quiet
enjoyment of their own homes is equally important.”
Independent Sydney MP Alex Greenwich, 70 per cent of whose constituents
live in apartments, sees the call for further discussion as an indication that the
government is listening to the concerns of strata communities.
“It’s clear from the many constituents and various stakeholders who have engaged
with both the government and myself, that further consultation is needed to ensure
strata communities are empowered to make decisions for their buildings, while
also acknowledging the role accommodation providers like Airbnb can play in a global
city,” he told Domain.
“In parliament the Minister [Matt Kean] has demonstrated his respect for strata
communities and stressed the importance of protecting people’s rights to the quiet
enjoyment of their own homes.”
Page 4 of evidence, 4th paragraph
“We recently introduced into Australia what we call the Friendly Buildings
Program, which is a program we have brought in from other parts of North
America. It is designed specifically for strata buildings. It gives owners
corporations an ability to make additional by-laws or additional rules to
support home sharing – for example, blackout periods. At Christmas or New
year they might not want home sharing during a particular period. It also
allows them to share in revenue. Overseas, we see that being between 5 to 15
per cent of revenue generated through Airbnb. It allows us to then have a
direct channel with the Owners Corporation and to partner with them if there
are cases of bad behaviour.”
This statement is inaccurate and misleading and contrary to the laws of Victoria.
The Friendly Buildings program cannot be implemented in Victoria for one very
compelling legal reason: In July 2016, the Supreme Court ruled that an Owners
Corporation has no power to pass and enforce by-laws (rules) that regulate shortterm letting. The Court was very clear that legislation needed to change before any
Rule could be found to be validly made.
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The Friendly Buildings Program also needs to be put into further context in term of
the comment relating to Revenue Sharing. What is proposed is that an Owners
Corporation may share in Airbnb’s commission, presumably to offset the wear and
tear on common property, with Airbnb providing a 5 -15% share of its commission.
A typical example would look like this: Unit 505 is let out for 1 night, at a cost
of $200.
The Owners Corporation’s commission would therefore be:
$200 divided by 6% = $12 Airbnb commission
5 – 15% of commission = $0.60 cents - $1.80 per night to the OC.
Respectfully, that sum of money is paltry and embarrassing, but realistically what
price could one put on their amenity, safety, security, wellbeing, and sense of home?
2.
Holiday and Short Term Rental Code of Conduct
Promoted by all presenters supporting the short-stay industry, in particular:
2.1
Holiday Rental Industry Association (HRIA) – 24 March 2017
Trevor Atherton (Chair) & Andrea Wilson (President)
Ms Wilson P6 refers to the implementation of a trial of the code of
conduct at Flinders Wharf, Docklands, released on 16 December 2016.
Comment from “We Live Here”
“We Live Here” provided feedback to the parliamentary committee
on 13 April 2017 from a former OC committee member at Flinders
Wharf who was unaware that a trial of the code of conduct was being
conducted.
The information concluded with the statement:
….To say that the HRIA Code of Conduct has been implemented at Finders
Wharf is very misleading.
Other documents from the same correspondent (appendix 1) provide
further insight into (i) the despair faced by owner-occupiers in
residential apartment buildings whose homes have been turned into
quasi-hotels by commercial short-stay operators, and (ii) the
numerous OC rules that are breached in the process.
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2.2
Victorian Accommodation Industry Association (VicAIA) – 24
March 2017
Paul Salter (Past President and Spokesperson)
1.2.1
In his introductory remarks Mr Salter refers to …… operating
short-term accommodation in Docklands for 10 years and having……. a
unique perspective on the legal clarification that has occurred over the past
five years.
Comment from “We Live Here”
Although not stated in the transcript Mr Salter’s short-term operations
in Docklands over the past 10 years – through his company Docklands
Executive Apartments– has been exclusively in Watergate Apartments
– and where currently 15 apartments are operated by him as shortstays. It is also where Marshall Delves is the Business Manager (BM)
and
Barbara
Francis, Chairperson
of the
OC
committee
of
management (OC Chair). We have therefore had a unique
opportunity to observe the ‘Code of Conduct’ in action. Being
involved in all the court action over the past five years we also have a
unique perspective on the legal aspects. In particular, Justice Riordan
in the Supreme Court in July 2016, in upholding a VCAT decision that
owners corporations did not have the powers to make rules about
change of use of a lot, provided clear guidelines on the powers of
owners corporations to make rules about the Common Property. It is
the latter that the proponents of the Code of Conduct ignore in their
own ‘House Rules’.
1.2.2.
With regards to the Code of Conduct Mr Salter states that:
…….…our (VicAIA) primary focus is to educate our members to understand
best practice …….that if they are going to occupy this space these are the
standards that we (VicAIA) would expect them to comply with …….. the
code is used to draw from to create the house rules ……… we also educate
owners corporations about what we are trying to achieve ……
Comment from “We Live Here”
One would expect that the Past President and spokesperson for
VicAIA would set the standard for a self-regulating Code of Conduct
through his own commercial operations.
However, over the past 10 years of operating within the Watergate
complex Mr Salter has:
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•
refused all requests from the BM for copies of public
liability insurance or work cover insurance to be provided
for his cleaners – a requirement for all contractors;
•
refused all requests from the BM for the names of disabled
guests so they can be included on a list in the Fire-room in
the event of a fire-alert;
•
compromised the safety and security of Watergate by
encouraging tailgating through the security door if he is
unable to greet his guests (Watergate has no concierge);
•
continually breached Watergate Rules by moving furniture
and other goods after hours, in complete disregard of the
permanent residents.
•
continually blocked lift doors open with suit cases whilst
loading the lift with other luggage –this shortens the life of
a lift by up to 5 years.
•
frequently handed out security swipes to non-residents
when leasing car spaces within a secure car-park;
•
advised in-house security not to call the police when one of
his guests causes a disruption – instead they are to call
him.
•
never approached the OC to discuss how his business
model could work harmoniously in our residential
building,
not
designed
for
quasi
hotel-style
accommodation.
2.3
Boutique Stays (& VicAIA) – 13 April 2017
Bev Constable (Owner/Director) and President of VicAIA
In her introductory remarks Ms Constable acknowledged that
………the short-stay industry has not satisfactorily addressed some of the
concerns that have been brought up by residents and owners corporations,
and between the two hearings as president of the VicAIA, she
challenged their committee to better address some of those issues and
to come up with a new model.
Comment from “We Live Here”
It is a positive step forward that the VicAIA has acknowledged that
the Code of Conduct that has been in place for the past five years is
flawed, and that an alternative way forward is required. Despite a
number of suggestions canvassed by Ms Constable in her presentation
it is too soon to make an informed judgement on a new model.
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However since the close of the public hearings “We Live Here” has
been contacted by Ms Constable to trial a 24-hour security call-out
hotline.
Response from“We Live Here” :
Dear ….
………….Whilst a 24 hour security call-out hotline may be feasible in
certain situations it is not appropriate for Residential Apartment
Buildings that have their own Building Managers and security systems in
place. This applies to Watergate and all the other Residential apartment
buildings that are represented by ‘We Live Here’.
So I am sorry but I am unable to recommend any buildings that would be
suitable for your trial.
Yours etc ……………………………………………..
This request and our reply highlights perhaps the major issue we have with
commercial short-stay operations in residential buildings not designed for
that purpose: these businesses are operating for a profit in buildings run by
owners corporations, that have building managers, rules for the common
property, security systems in place, processes for handling complaints etc.
Their business model, code of conduct etc should be designed to work within
an owners corporation, adhering to the rules for the building, paying
compensation for wear and tear etc, and not just instructing (or educating) us
on what they are trying to achieve. In our view this is not what was intended
by Justice Riordan’s decision and it is time the conversation turned around.
In conclusion whilst the Code of Conduct in its present form is seriously
flawed because there is no independent watchdog to conduct regular audits it
also suffers from having one model fits all, and in its present form is
inappropriate for apartment buildings run by owners corporations.
Appendix One – comments and email from Committee Member of Flinders Wharf
in Southbank rejecting notion that there was a ‘trial’ of the HRIA Code of
Conduct.
Appendix Two – NSW Government response to the Final Report of the
Parliamentary Inquiry into the Adequacy of Regulation for Short-Term Holiday
Letting.
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