Short-Term Rental Accommodation and Housing in Australia

Australia is facing unprecedented challenges when it comes to housing. A range of factors alongside a once-in-a-generation pandemic, have placed immense pressure on our local housing landscape.Airbnb has teamed up with experts, Urbis, to better understand the role of short-term rental accommodation (STRA) in the housing market. The study also highlights the important part Airbnb plays in the Australian visitor economy.Using Airbnb data, Urbis has analysed six states around the country to examine the scale of impact including New South Wales, Victoria, Queensland, Western Australia, South Australia and Tasmania.

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Key findings

Overall, analysis of STRA and housing affordability has found every location is different and STRA has no consistent impact on affordability.

Therefore, other factors must be driving affordability outcomes in Australia.

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Looking at the presence of STRA in Australia

The total proportion of non-hosted* STRA, short-term stays where the Host is not physically present, varies substantially by location.

Short-term rentals are typically 1 to 2 percent of the overall housing stock in each state.

In 90% of all local government areas (LGAs), non-hosted STRA properties represent 5% or less of total dwelling stock.

Less than 3% of LGAs have non-hosted STRA at levels of 10% or higher. When this does occur, it tends to be in areas that have significant tourism and seasonal economies.

*non-hosted refers to short-term stays where the Host is not physically present during the guest’s stay.

When it comes to the impact of STR on the broader housing market

No consistent relationship between the proportion of non-hosted STRA and vacancy rates for long-term rentals.

No strong relationship between the proportion of non-hosted STRA and rental affordability.

Only a weak relationship between the proportion of housing utilised as non-hosted STRA and the proportion of households in rental stress (lower income households that spend more than 30% of gross income on housing).

Only a weak relationship between changes in the proportion of non-hosted STRA and changes in real rents.

Overall, even within locations with a higher proportion of housing used as non-hosted STRA, housing affordability varies significantly, indicating STRA has no consistent impact on housing affordability.

The role of STRA in Australia

Crucially, Urbis finds that STRA plays an important role for guests, Hosts and the wider community.

Our Hosts make vital contributions to local communities by sharing the spare or underutilised spaces. More guests can explore more locations across the country, with flow-on benefits to towns and cities.

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Benefits to guests

STRA plays an important complementary role for the visitor economy.

Guests believe STRA provides options that are more conveniently located, better value-for-money, and offer greater levels of privacy.

Local business chambers believe STRA plays a significant role in fulfilling demand associated with a number of key investment areas for their regions such as infrastructure, business and visitor economy projects.

In regional locations where 4- or 5-star accommodation is less common, STRA has been able to fill this gap with high-quality properties that enable regions to attract high-spending visitors.

Benefits to Hosts

The vast majority of Hosts list one property and over 90% of Hosts live within the same state as the property they host.

Hosts share their homes for economic reasons but also social and wellbeing reasons – e.g. to meet new people and learn about other cultures.

A significant proportion of Hosts share their homes as STRA because they are not otherwise fully utilising their property.

Benefits to communities

STRA provides support to local businesses with 85% of Hosts using local services such as trades, cleaning services and linen supply.

In regional locations, STRA plays a vital role in providing accommodation for temporary workers and people undertaking education or medical placements.

Often STRA is better suited to families who need more space or particular facilities as well as longer-term stays when compared with traditional accommodation.

Local business chambers acknowledge visitors are choosing STRA as a ‘home away from home’ particularly when visiting for over a week as traditional accommodation may NOT be appropriate (for example, attending a sporting event, work placements, accessing education or medical services).

STRA also functions as a pressure valve for regional locations in peak periods, ensuring there is still adequate supply of accommodation for visitor segments that are part of the normal seasonal flows.

A survey of our Host and guest community, carried out by Urbis, has revealed the following key insights.

Guests on Airbnb prefer to stay in short-term rental accommodation as they can find a listing that suits their particular needs and budget, or allows them to explore new parts of the country that otherwise have limited alternative options. When guests were asked their reasons for choosing STRA over other accommodation options:

Hosts on Airbnb share their homes for a range of reasons. While economic motivations are the most common, there are also social and wellbeing factors, such as meeting new people and sharing and learning about other cultures.

Airbnb is committed to being a collaborative partner to all stakeholders in Australia, helping to create jobs and disperse the benefits of tourism to more neighbourhoods and communities. While we may not be the root cause of housing pressures in most LGAs, we believe there is more we can do to help make a positive difference particularly in LGAs in which short-term rentals have a greater footprint.Contact us at australiapolicy@airbnb.com

Airbnb acknowledges the cultural Custodians and Traditional Owners of the lands and waterways on which we live, work and travel.