What the New Subletting Legislation Means for The Department of Fair Trading NSW

admin |  Posted on Friday, February 1st, 2019

Last month we wrote about understanding the short term accommodation market in NSW and the new legislation that affects short term stays at strata properties. In this article, we’re looking at the impact that these changes are having on the department of Fair Trading NSW, and how they could affect your strata scheme.


What role does the department of Fair Trading NSW serve within strata scheme management?

Fair Trading NSW plays a vital role in the smooth operation of strata schemes throughout the state. Their role is to provide information on all aspects of living at a strata property, as well as solving disputes that may arise between owners corporations, strata management and/or owners. Fair Trading aims to find impartial and definitive solutions to strata issues.


Which changes do the new NSW strata laws cover?

There are a number of updates with the new short term letting legislation. While local council zoning restrictions used to be the only real option to control short term stays, there are now letting time limits and a new penalty system.


  • A 180-day annual limit on short term stays

Short term hosts within Greater Sydney will only be able to rent out their homes for up to 180 days per year.

  • A Holiday Rental Code of Conduct

Short term stay operators must sign a new mandatory Code of Conduct. If a host or a guest breaches the Code twice in two years they’ll be banned from short-term holiday platforms for five years. If property agents and platforms fail to check the register before taking on a new customer, they can face fines up to $220,000 for individuals and fines of up to $1.1 million for businesses.

  • New owners corporation powers for non owner-occupiers

An owners corporation can vote to ban short term stays in their building with a 75% special resolution, as long as the short term operator does not live in the unit they’re renting out. If an owner-occupier wants to let their property out in the short term, the owners corporation cannot ban this practice.

How will the new short term letting legislation affect the Department of Fair Trading?

Under the new legislation Fair Trading NSW will have new powers to appoint adjudicators to independently judge complaints against the industry Code of Conduct, and to access data from short term stay platforms to make those decisions. Fair Trading will also maintain the register of strikes against offending parties and be able to impose fines for failing to check this register. Fair Trading NSW has stated that the enforcement of the Code and the register will be funded by industry. The department will ultimately have far more control over those who are disruptive to others during a short term stay, and it may also be able to gain valuable insights into how to best manage the practice of short term letting as it likely becomes even more popular in the future.


Put simply, we expect that the new NSW strata laws will add plenty of new work for Fair Trading NSW, but that these changes will ultimately allow both residents and guests to enjoy the quiet and peaceful use of strata units.

CATEGORIES strata laws