Question: When a by-law bans short-term letting unless the lot is someone’s principal place of residence, can a tenant rent out their spare bedroom?
I’m renting a two-bedroom, two-bathroom apartment. I was told Airbnb isn’t allowed, but the by-law I was sent says: “an owner, lessee or an occupier of a lot must not use or allow it to be used for short-term rental accommodation arrangement, if the lot is not the principal place of residence of the owner, lessee or occupier of the lot.”
Since the apartment is my principal place of residence, am I allowed to rent out my spare bedroom?
Answer: If the apartment is genuinely your principal place of residence, the by-law wouldn’t appear to stop you hosting, but you still need your landlord’s consent and must meet the NSW STRA requirements.
Renting a spare bedroom on Airbnb when you are a tenant
There are several separate issues to consider before renting out a spare bedroom for short-term rental accommodation (STRA).
Based on the by-law wording provided, the restriction applies where the lot is not the principal place of residence of the owner, lessee or occupier. If you genuinely live in the apartment as your principal place of residence, you would not appear to fall within that particular prohibition simply because you wish to offer your spare bedroom as hosted STRA.
However, satisfying the strata by-law is only the first step. It does not automatically give a tenant permission to operate short-term rental accommodation from the property.
Your residential tenancy agreement also matters
As a tenant, you should review your residential tenancy agreement and obtain your landlord’s express written consent before advertising the room or accepting bookings. Renting a bedroom to paying guests may constitute subletting part of the premises, so your rights under the strata by-laws should not be confused with your obligations to your landlord.
In other words, the strata by-law may not prohibit your proposed arrangement because the apartment is your principal place of residence. However, you must still satisfy the requirements of your tenancy agreement.
Hosted and non-hosted STRA are treated differently
It is also important to understand whether the proposed arrangement is hosted or non-hosted STRA.
Hosted STRA generally occurs when the host resides at the premises while providing the accommodation. Renting out your spare bedroom while continuing to live in the apartment would ordinarily fall into this category. Hosted STRA is not subject to an annual day limit under the NSW planning framework.
Non-hosted STRA occurs when the host does not reside at the premises during the stay. Different restrictions can apply, including annual day limits in certain parts of NSW. For example, in Greater Sydney and some other prescribed areas, non-hosted STRA is generally limited to 180 days in a 365-day period. Bookings of 21 consecutive days or more to the same person or persons are not counted towards that limit.
The distinction is important because changing how you host in the future could change which planning restrictions apply.
Planning and NSW STRA requirements still apply
Before proceeding, you should also check the applicable planning controls and any existing Development Consent for the building. Some Development Approvals may specifically restrict or prohibit short-term rental accommodation. The fact that a strata by-law does not prohibit your particular arrangement does not override planning requirements or conditions applying to the development.
If the landlord consents and the planning position permits the proposed use, the relevant NSW STRA requirements must also be satisfied. Depending on the circumstances, these include:
- registering the premises on the NSW STRA Register before advertising or offering it for STRA
- meeting the applicable fire safety requirements
- complying with the mandatory Code of Conduct
- maintaining appropriate insurance
- complying with the scheme’s by-laws and providing required information to guests, neighbours and the owners corporation.
As the host, you also have responsibilities for guest behaviour and must take reasonable steps to address complaints or issues associated with the stay.
Why this issue matters
The key distinction is that being eligible under the strata by-law does not necessarily mean you are authorised to host.
STRA involves several layers of requirements. In this case, the relevant questions are:
- Does the strata by-law permit the arrangement?
- Does your landlord consent?
- Do the planning controls and Development Consent permit it?
- Have the applicable NSW STRA registration, safety and Code requirements been satisfied?
Each needs to be considered before proceeding.
What should your next practical steps be?
Start by reviewing your tenancy agreement and obtaining your landlord’s written consent. Then review the full strata by-laws and confirm the property’s planning and development consent status. You should also establish that your proposed arrangement qualifies as hosted STRA and complete the applicable NSW STRA registration, fire safety, insurance and Code of Conduct requirements before accepting guests.
Good short-term management goes beyond eligibility
Where STRA is permitted, good strata management should also help owners and occupiers understand their ongoing responsibilities within the building. Practical tools can support this, such as owner and guest handbooks, clear noticeboard information, straightforward communication about relevant by-laws, and a clearly nominated host for each lot so there is an identifiable contact if issues arise.
These measures help set expectations early, reduce confusion for guests and residents, and give the owners corporation a clearer framework for managing short-term stays consistently across the scheme.
This post appears in Strata News #814.
Leanne Habib
Premium Strata
E: info@premiumstrata.com.au
P: 02 9281 6440
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