Landlords should only be able to run their properties as Airbnbs in Byron Bay for two months of the year as the popular tourist destination faces growing rates of homelessness and inequality that are "unique" to the area, an independent commission says.
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Advice on short-term rental settings in the northern NSW town was requested by former planning minister Anthony Roberts after the Byron Shire Council last year sought to halve the 180-day cap on such properties.
Some local precincts in Byron Shire would have been exempt from the cap.
The Independent Planning Commission this week went further, recommending a 60-day cap on all short-term rentals across the Byron Shire.
A 90-day cap would not have provided sufficient incentive for Airbnb landlords to re-enter the long-term market, and could have the unintended consequence of harming business activity, the commission said.
It said the council should be empowered to create a new process where it can approve new Airbnb and similar rentals exceeding the 60-day cap on a "case by case" basis.
Mr Roberts' successor, Planning Minister Paul Scully, said he had received the commission's report and intended to review it in coming weeks.
Mr Scully said it was important to maintain the function and character of places people live, while maintaining the appeal for visitors.
"I will consider the findings in this context," he told AAP.
Byron Shire faces unique housing pressures due to being a year-round, highly attractive tourist location, which meant cost-of-living pressures felt around the country were amplified in the small town, the commission wrote in its advice.
Housing in the area has significantly increased in cost, with growth outpacing regional NSW and Sydney.
Half of the residents in the area experience rental stress, and homelessness is on the increase.
About 1300 homes in Byron Shire, or about one in 12, are registered as short-term rentals - many of which had previously been let out on a long-term basis.
Before granting new approvals for Airbnbs in the area, decision-makers such as the council should be required to consider the current rental availability and other local impacts, the commission said.
It also recommended introducing a levy on all short-term rental operators, as a way to provide income to local councils and improve local amenities.
AAP has contacted Airbnb for comment.
Australian Associated Press
