Re: Last word on new short-term letting laws

Apparently the part-year rent has been happening in places like Bondi for years. Logically you need 120 nights of occupancy at 3 times the normal rental to cover the same rent as you would get for a whole year.

You probably aren’t going to get that  but if you can get 90 nights at 2.5 times the rent, allowing for occasional vacancies, and 250 nights at normal rates, that works out at 30 percent more per year.

Now if you are a passive property investor, that might not seem worth the hassle – although online agencies like Airbnb and ancillary services that hand over the keys, clean the units and change the sheets can make holiday letting a little too easy for some tastes.  

And while you are I would be more than happy to allow a tenant to live indefinitely in the property as long as they don’t cause problems and will accept a modest rent increase in line with the CPI, there is a new breed of property investor out there.

These property “entrepreneurs” are looking to make whatever profit they can, whether it’s by “flipping” new apartments before they’ve even set foot in them, turning the worst unit in the best building into a design showpiece or aggressively pursuing the maximum rental income by whatever means available to them, legal or otherwise.

They see that as their job, their right and their sure and certain route to wealth and a fantastic lifestyle played out on the social pages. They generally don’t over-think the social consequences of grabbing their share of fame and fortune.

If that seems a trifle negative, the fact that rents in popular holiday areas have gone up  by up to three times the city average in the past five years must have a logical cause.  

The fact the rents in the suburbs just outside the popular holiday areas have also increased more than the rest of the city – and in the same time period –  would, logically be because of those higher rents in adjacent suburbs.  

What has happened in the past five years? One thing is that housing stock has been increased considerably through the construction of new apartment blocks in former industrial areas.

What else?  Well, I can tell you there’s very little chance it’s because people have been renting their spare rooms to rubberneckers from West Virginia.  So you have to ask what major force is there now in the rental market that wasn’t there five years ago.

You do the math, as the Americans say.