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Brisbane council cracks down on investors operating ‘pseudo hotels’

By Juliet Helmke
16 June 2022 | 10 minute read

A crackdown on short-term rentals will see Brisbane property owners pay substantially higher council rates to operate holiday homes, with the local mayor lamenting “different tenants coming and going”.

Brisbane’s lord mayor Adrian Schrinner unveiled the Queensland capital’s budget on 15 June, which included a steep rate hike for property owners trying to make money off the short-term accommodation marketplace. They will now pay 50 per cent higher rates than those who rent out their properties on a long-term basis.

Acknowledging the pressing housing crisis facing the city during a speech introducing the new budget, he zeroed in on the rental market as an area in need of intervention.

“With the rental vacancy rate now at record lows, it’s incredibly hard for tenants to find affordable places to live with six- or 12-month leases. Short-term rentals may be convenient for tourists and visitors to Brisbane, but they throw up a minefield of issues,” Mr Schrinner said.

“The short-term rental trend, facilitated by well-known booking apps, removes homes from the long-term rental market. To be clear – this contributes to supply shortages and increasing housing costs.”

He said the 50 per cent increase in council rates would bring the levies imposed on those operating holiday rentals closer in line with what is charged to commercial operators.

It will apply to whole properties (but not single-room rentals) where the dwelling is available for short-term stays more than 60 days of the year.

The rate hike will involve the introduction of new rating categories for transitory accommodation. A property on the minimum rating level, for example, will be subject to a hike of almost $600 extra a year.

Acknowledging that some might find the increase hard to take, he characterised it as a requirement for owners to “pay their fair share”.

And he noted that while owners will initially be encouraged to self-identify, the council will increasingly use public reporting and its own online research to pinpoint who should be paying the increased rates.

Mr Schrinner made it clear that the ultimate goal of the plan was not to rake in more money but to encourage property owners to return their investment properties to the long-term market.

“Residential streets were not meant to be home to pseudo hotels, with different tenants coming and going every weekend,” he commented.

The council’s move comes just a few months after the Real Estate Institute of Queensland (REIQ) implored investors across the state to release their homes onto the long-term market, after the flooding pinched rental vacancy rates even further.

“Displaced tenants and owner-occupiers are now hitting the market, desperate for alternative accommodation, adding to the already unprecedented demand for long-term rental accommodation. It is difficult to see any way that this wave of demand can be met without the support of property owners moving their properties to the long-term rental market,” REIQ chief executive Antonia Mercorella commented at the time.

In addition to the city’s crackdown on short-term rentals, Brisbane will also embark on a project of identifying new areas that can be unlocked to create residential and mixed-use communities. 

Called “Suburban Renewal Precincts”, it will look to expand the city’s residential footprint into areas that may have previously had a commercial or light industry use, according to Mr Schrinner.


Juliet Helmke

Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.

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