Christchurch Airbnb-type operators could face $1000 bill

Wednesday, 7 November 2018

Airbnb and its competitors aren't just giving you the chance to live like a local, anywhere in the world. They're also seriously shaking up luxury travel.

Christchurch homeowners renting entire properties on Airbnb may have to get a permit or pay more in rates – if the council can catch you out.

The city council has for months been nutting out how to regulate the short-term accommodation industry.

On Wednesday, its regulatory performance committee discussed applying a business rate on whole properties used for hosting short-term guests in schemes like Airbnb for four or more months a year, or a possible permit system.

Renting your Christchurch house on Airbnb for more than four months a year? The council wants to bill you about $1000.

The aim is to create a fairer situation for traditional accommodation suppliers like hotels and motels. Based on average property value, the council estimates a business rate would add $1000 to the rates bill of about 700 affected properties – though this would not increase overall council revenue, but lead to a reduction on the rates of other properties.

The problem is, the council has no extra money or staff to enforce the proposed moves. Currently staff only investigate properties when the public make complaints.

* Airbnb surge triggers Canterbury research

* Queenstown council calls for urgent bed tax pilot**

Home-share accommodation has grown rapidly in Christchurch. Airbnb listings grew from 283 to 3481 in the last two years (June 2016 and August 2018). During that time, Airbnb's share of guest nights in Christchurch grew from 0.7 to 21.6 per cent. Entire home listings grew from 114 to 1471 over the same period.

Of those, the council has identified 1100 properties being used for Airbnb that could be operating in a residential area, for any length of time, without the necessary resource consent.

The committee recommended on Wednesday the council investigate the feasibility of a permit system as well as the business rate.

Staff would be asked to identify how to fund enforcing those measures.

The rates team did not have the resources or budget to carry out the changes being proposed, council economic policy principal adviser Gavin Thomas said.It would take one staff member a week to investigate three or four potentially non-compliant properties operating on Airbnb, council consenting and compliance general manager Leonie Rae said.

The committee called on the council to lobby for central Government to investigate putting legislation in place to regulate the home-share accommodation sector.

A council residents survey found 20 per cent of respondents would not have travelled if home-share accommodation was not available. Some 62 per cent would have travelled anyway.

In residential zones, 800 whole unit listings were available in Christchurch for more than 90 nights a year; 696 of those were available for 120 night or more. If people rent their home or residential property to short-term fee paying guests it was likely they needed to apply for a resource consent.

Other councils across the country are grappling with how to deal with the growing short-term accommodation sector. Auckland Council has bought in a tiered rates scheme in which home-share operators pay a percentage of their rates as business rates, depending on how many nights per year are booked.

The Queenstown Lakes District Council wants to use its District Plan to limit the number of days a home-share could operate without resource consent annually in certain areas.

Committee chairman Cr Jamie Gough said he preferred to take a 'wait and see' approach so the council could learn from Auckland and Queenstown's mistakes.

'Regulation is needed, but I don't think we need to be at the forefront of it.'

Airbnb Australia NZ head of public policy Brent Thomas said Airbnb believed broad-based bed taxes, not council rates, were a fairer way to raise revenue from tourism.

He said he wanted to work collaboratively with the Christchurch council and other local governments to develop fair and balanced rules for home sharing.

Airbnb injected more than $36.5 million a year into the Christchurch economy and supported more than 360 local jobs, he said.

Tourism Industry Aotearoa hotel sector regional chairman Michael Patterson said a tiered system with varied rate charges depending on how often the property was used as a home-share would be a fairer approach than what the council was proposing.

He said it was hard to justify hotel development if there was an easier pathway setting up alternative accommodation.

'An investor could say buy 50 or 60 units and Airbnb them more easily than building a hotel, so that's actually a very real possibility of competition for hotel investment dollar.'