On Melbourne’s Mornington Peninsula, famed for its beaches, day spas and wineries, short-term stays have become big business.
One stylish four-bedroom home a block from Rye beach made its owner $90,000 last year, according to Inside Airbnb analysis. The person who manages it also runs another 44 homes across the area.
But the way Melbourne’s weekend getaway spot operates could be about to change.
Housing advocates say the rise in popularity of short-term stays on the peninsula is affecting affordability and driving people into homelessness or out of the area. The Victorian government is working on a housing affordability package expected to be announced in September – and a tax on short-term stay rentals is among the measures up for consideration.
For now, the peninsula has become one of Australia’s hotspots for short-term stays. About 20% of the area’s housing stock is now being used as short-term stays, according to Ben Smith, the chief executive of the Mornington Community Support Centre, which delivers emergency relief and crisis support on the peninsula.
“That’s one of the highest in Australia – Byron Bay [is] pretty equivalent,” he said.
There are more than 4,700 Airbnb listings across the area, booked out at an average of 53 nights a year and making an average of $19,727 annually, according to Inside Airbnb, which provides data about the short-term rental platform’s impact on residential communities. The accuracy of the data it collects has been disputed by Airbnb.
In April the vacancy rate in the area was about 2%, with the weekly median rent increasing $139 in the past five years to $583 a week, according to CoreLogic.
A ‘perfect storm’
Getting a rental on the peninsula has become very difficult, with properties becoming less affordable over the past five years. That is having flow-on effects for the people who live there full-time.
“Much of that increase has occurred in just the past three years,” said Eliza Owen, the head of Australian research at CoreLogic.
“We can’t say for sure that [short-term stays] are the only factor driving rents higher but I think it is fair to assume it is a contributing factor,” she said. “Especially if you’ve got people who are living and working in the rest of the metropolitan Melbourne who look at the Mornington Peninsula as kind of a weekend getaway spot.”
Smith said the market meant families had to move away from schools and it was making it difficult for businesses to get employees for casual or lower-paying jobs.
“In markets like ours, where you’ve got high levels of tourism and casual employment needs, you have this perfect storm of needing people to come and having nowhere to have the employees live,” Smith said.
He said there is now a large group of people living rough along the foreshore.
“Our estimation is that there’s about 1,000 people experiencing homelessness at the moment on the peninsula,” he said. “And we estimate that somewhere between 15% and 20% of that is people who are sleeping rough, which is an extremely high rate when compared across the state.”
What a levy would do
Labor MPs, who spoke to Guardian Australia on the condition of anonymity, expect the upcoming housing package to include support measures for renters and first home buyers as well as a suite of changes to the state’s planning laws in an effort to boost housing supply.
One MP said a levy for properties listed on Airbnb was one option “on the table” as part of the package. Similar changes have been discussed elsewhere, with formal planning advice given to New South Wales advising that Byron Bay’s council could impose a 60-day annual cap on short-term rentals in the holiday hotspot.
The Victorian Greens have previously called on the Andrews government to introduce a 90-day cap on Airbnb listings a year. Airbnb Australia and New Zealand’s head of public policy, Michael Crosby, said the company was not opposed to a statewide tourism levy and supports the introduction of other frameworks, such as registration and a code of conduct.
“Airbnb supports the introduction of opt-in tourism levies to fund much-needed community infrastructure and services – for example, key worker housing projects – in communities across Australia,” he said.
“We believe tourism levies are a fair and sustainable way to raise revenue for local communities, especially in areas of high tourism, as they broaden the revenue base without imposing an additional burden on local ratepayers or businesses.”
But Mornington Shire council has questioned if the proposed levy is really about curbing affordability – or if it is pure revenue raising.
Mornington Peninsula’s mayor, Steve Holland, said his council needs more powers to regulate housing, including implementing planning zones and restricting the number of nights short-term stays can operate. “If there is any kind of state levy, that money has got to go back into local councils or it’s got to go back into social and affordable housing,” he said. “Otherwise, it’s really just fixing the debt problem.”
Smith said they need a restriction on the number of nights Airbnb can be operated and more public housing.
“The reality is that the number of public houses on the peninsula is extremely inadequate,” he said. “And there is next to zero investment coming down here when it comes to any sort of new infrastructure.”
