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Airbnb kings of Orange say they have nothing to do with the housing crisis. Here's why
July 4, 2022
By Peter Holmes
In the debate about the lack of affordable housing in Orange for those on low and fixed incomes, there is a lot of blame being tossed about.
Targets include low interest rates and loose lending by banks driving up prices, land-banking by developers choking supply, tree changers with their Sydney and Canberra money, insufficient investment in social housing by state governments over the long-term, councils kicking the can down the road, and short-term rentals via companies such as Airbnb and Stayz.
There are hundreds of such tourist-friendly properties - known as Short-Term Rental Accommodation (STRA) - available in Orange and surrounds, and they’ve become a bit of a bogeyman around town and on social media forums.
The logic goes that if all those houses currently let for STRA were in the long-term rental pool, the situation in the city would not be as dire.
The Orange News Examiner spoke to Aaron Taylor, the general manager of BNB Made Easy.
The company was founded four years ago by Tim Mortimer who, like Taylor, was a former school teacher.
Blaming STRAs was “a very simple, under-considered solution to a problem that won’t actually fix it”, Taylor said.
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BNB Made Easy leases out around 100 STRA properties in and around Orange, and a handful in Bathurst, on behalf of homeowners.
Taylor is aware of the angst, anger and anxiety around the lack of affordable housing in Orange, but argues that BNB Made Easy is not part of the problem and, in fact, actually drives a lot of economic activity in the city.
Most of the properties the company represents are either high-end out of town farm stays, or in the golden ring of high-end older homes around Summer Street, with their leadlight windows, pressed metal ceilings, entertainer’s kitchens and pristine gardens and courtyards.
He described the properties as being at “the top end of the market” and said even if they had been leased to long-term renters, they would be well outside the price range of average households, let alone those on lower and fixed incomes.
“Even though we’ve had a population increase of eight percent over the last four years, we haven’t had a corresponding increase in household incomes,” Taylor said.
“Our clients wouldn't be able to get the long-term renters into their homes, nor are they actually interested in doing that.”
This point is crucial, Taylor believes, as it puts to bed any notion that properties listed with BNB Made Easy are pushing up long-term rents by lowering the number of available properties.
“Tim founded the business when he was working in a school; he saw a lot of parents from Sydney whose kids were in boarding school here, so they had homes here that they’d stay in when they came to visit.”
He said that in the vast majority of cases the houses would sit empty for much of the year.
“They were never available to the long-term rental market in the first place.”
As the demand for STRA grew, Taylor said some of these homeowners chose to open the properties up to bookings on platforms such as Airbnb.
“There is a difference between investors looking for a long-term renter, and investors looking for short-term.
“What we’re finding is that those investing to use the property as a short-term rental want flexibility to accommodate their friends and family, so the short-term rental market suits them. They have complete access to the calendar and can block any days [they want].”
Taylor said that although the company represents “a couple” of suburban houses in North Orange, “the vast majority are either rural properties - farm stays - or luxury CBD homes, the old ones in Hill Street and Lords Place. Old school, classic Orange homes that people from Sydney want to stay in ... because that is the experience they're after”.
He said the few suburban homes that might otherwise go to middle income earners as long-term rentals are used by workers such as miners, health care professionals and lawyers who sometimes stay for months at a time.
“They’ll utilise one of those lower market homes for a longer period,” Taylor said, “but to me that means they’re not taking up a proper longer term rental [that would then sit empty for periods of time].”
Council papers from last month show that staff have been asked by councillors to: “Prepare a local Short Term Rental Accommodation policy with a view to providing appropriate DCP [Development Control Plan] provisions and incentives for STRA operators to maintain or provide some level of longer term rental stock.”
It is possible that council may try to cut the number of days homeowners can use a property for short-term rentals, but it’s not clear that there is much stomach for this. We will see in the coming weeks and months.
Councillor Jeff Whitton told The Orange News Examiner that people who bought investment properties should be able to use them for whatever they want.
Declaring an interest in owning an investment property used for STRA, Whitton said that council should instead look at the idea of becoming a landlord.
“One of the things we might need to look at, if you really want to take control and have some say over what housing stock is in your community - from a rental point of view and a low income point of view - is do we get into using our land to build dwellings specifically for that purpose, so that you've got houses that are available for rental?” Whitton asked.
Former mayor Reg Kidd told The Orange News Examiner that this idea had been floated once before.
Taylor said that some tourists were looking for “more Covid-friendly stays if they are staying for two or three nights” and this included concerns about ventilated air conditioning in some commercial properties.
A search for accommodation in Orange on Airbnb for a weekend in August for four adults yielded 146 results.
Most of these properties were at the higher end.
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However search for two adults and not four, and more modest properties - including suburban villas - start to appear. The type of properties that a few short years ago might have been leased reasonably cheaply to long-term renters.
Taylor said the company employed dozens of cleaners - who were often able to work around school drop-offs and pickups - and retired handy people, who enjoyed the small jobs required at the properties.
He said a cap on the number of nights would “drive the economy back a bit”.
Orange City Council and a local marketing company had worked hard to raise Orange’s profile and “on weekends we are 100 percent booked out, so it’s working”, Taylor said.
Asked if the STRA boom had caused consternation among hotel and motel operators, he said: “No, because we’re a different market. First, we have a two-night minimum stay and in holiday periods it’s extended to three.”
He said “we all work together”, sold inventory via different booking platforms, and that a recent forum brought STRA businesses, hotels and motels together “to talk about tourism and what trends we’re seeing”.
While hotels and motels were more likely to cater for workers and people who just wanted a room for a night, STRA properties attracted groups of couples and families who wanted to spread out, drink local wines and utilise the kitchens.
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