Australians are quitting their day jobs to become full-time Airbnb landlords without owning a single property, in a subletting scheme critics say is putting strain on an already dire Sydney rental market.
As Sydney grapples with a housing crisis – where the median asking rent on a unit is a record $750 a week and the vacancy rate is just 0.9 per cent – an emerging short-term rental arbitrage business is booming, fuelled by TikTok hustle culture.
TikTok is full of creators showing off their profits from Airbnb hosting without owning any property.Credit: @jorpham, @strjesse and @amareayman_
Jordan Pham claims to make $217,000 a month as an Airbnb host with 40 properties, all owned by other people. He “mentors” others on how to do the same, including in Sydney, where it’s possible to sublease properties available on the long-term market as short-term rentals with no real estate licence needed.
Hosts will search online for suitable apartments, usually in inner-city suburbs or nearby major business hubs and universities. Then it’s just a matter of securing the rental, furnishing it, and listing it on a short-term rental platform for a much higher rate.
“This method is so simple even a dumb six-year-old can do it,” Pham says in one video.
The 22-year-old told the Herald he knew Sydney was facing a rental crisis, but argued most hosts were targeting homes not suitable for families, too expensive for most workers, or that would have otherwise remained vacant.
“It’s 100 per cent a valid concern, but blaming Airbnb for a citywide rental crisis is such an easy narrative … the rental crisis that we are facing today, particularly in Sydney, is a result of decades of so many factors,” he said.
City of Sydney Councillor Jess Miller doesn’t see it that way. She believes this subletting scheme is making it harder for Sydney workers to secure long-term homes.
“This practice is being promoted by ‘Instagram bros’ and hustle culture who are promoting it as a way to make quick cash,” she said.
“They brag about how much money they are making and then charge their followers to help them do the same … without data or any kind of regulatory framework or enforcement power, there is nothing council can do.”
The City of Sydney this week voted to explore options to crack down on short-term rentals with one option put forward by Greens councillor Matthew Thompson being a 60-day cap per year. Sydney already has a 180-day cap, but Miller said poor oversight of the industry means many are likely using loopholes to sidestep the restriction.
Pham believes the cap would wipe out plenty of Airbnb businesses overnight, and argued other businesses like cleaners and handymen would also be impacted.
These hosts need to acquire the approval of the landlord to sublet as well as register the property as a short-term rental.
Multiple Sydney property managers told the Herald rental applications from short-term rental businesses had increased in the last two years. One property manager who asked not to be named to be able to discuss client matters freely, said one Redfern apartment attracted about 15 Airbnb pitches.
“We hate it as an industry,” property manager and principal at The Rental Specialist Jo Natoli said.
“It’s taking away rental properties from people who actually need it, they’re likely to pay a little extra in order to incentivise owners, if they even seek permission in the first place, which artificially inflates the rental market.”
Natoli recommends her clients refuse these requests, and said it can be disheartening for local workers and families who are competing against short-term rental businesses when looking for a home to rent.
“The lawmakers, the parliamentarians … I don’t know that they have a full appreciation of just how much the short-term market has infiltrated the long-term market.”
Minister for Better Regulation and Fair Trading Anoulack Chanthivong did not answer when asked if he was concerned about the practice, but said tenants must hold valid insurance to legally run the business.
Chanthivong said the best way to reduce demand for short-term rentals was to build more visitor accommodation, and said the government enforced “strong compliance action” if hosts were found in breach of the industry’s code of conduct.
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Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: www.smh.com.au
