The Short Stay Levy Act came into effect on 1 January 2025. This Act included amendments to the Owners Corporations Act 2006 – most notably to Schedule 1 – Power to make rules of owners corporation – effectively enabling Owners Corporations (OCs) to prohibit the use of Lots as short stay accommodation (with exceptions).
For many OCs, this is an exciting prospect and welcome change. For all members of an OC, it is a timely reminder to be an active participant in the decision-making process.
What does this mean for Committees and OCs?
Schedule 1, Item 5 has been amended to include the following:
5.5 Prohibition on use of lots as short-stay accommodation (but not prohibiting an owner of a lot, or a lessee or sub-lessee of the owner of a lot, from providing a lot as short-stay accommodation if that person occupies the lot as their principal place of residence).
In simple terms, this means an OC may now include a rule which prohibits Lot Owners from listing their lot(s) as short stay accommodation, unless the lot is their principal place of residence.
The definitions of “short-stay accommodation” have also been updated as below:
“short-stay accommodation” means accommodation provided under a short-stay accommodation arrangement;
“short-stay accommodation arrangement” means a lease or licence for a continuous period of less than 28 days to occupy a lot or part of a lot affected by an owners corporation that is—
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in a building wholly classified as a Class 2 building in Part A3.2 of Volume One of the Building Code of Australia; or
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in the case of a building where only part of that building is classified as a Class 2 building in Part A3.2 of Volume One of the Building Code of Australia—in that part of the building
An OC will need to pass a special resolution in order to amend its rules and enact the ban. This means 75% of Lot Owners will need to vote in favour (or at least 50% for an Interim Special Resolution).
RELATED – Learn more about OC resolutions >
Prior to launching a ballot or calling a Special General Meeting, committees may wish to write to OC members asking for their opinions on the topic. We would suggest having any proposed rule reviewed by a lawyer to ensure it is valid and enforceable.
What does this mean for Lot Owners?
As a special resolution is required to make any changes, a ban in your community should not take you by surprise.
Keep an eye out for communications from your OC and be engaged. You may get notice of a Special General Meeting, or of a postal ballot, and in order to have your say you will need to be involved. If you are living away, or otherwise not able to partake, you could consider giving your Proxy to someone to attend/vote on your behalf (just be sure to let them know your stance on the matter).
If you feel strongly either way regarding a ban on short stay in your OC, it might be worth writing to your OC to let them know, this will help inform their actions.
What if my Lot is used as Short Stay Accommodation?
If you live in your Lot as your principal place of residence and sometimes lease it out (e.g. when you go away) or lease out part of it (e.g. a room) then this change will not affect you.
If your Lot is solely used as Short Stay Accommodation and you live elsewhere, you will want to keep a close eye on communications from your OC.
To be proactive, you may wish to contact your Owners Corporation to ask if they are exploring implementing the ban and share your stance. For many OCs, short stay may not be an issue, and the change therefore not required.
If your OC does explore the ban, keep an eye out for a notice of ballot or Special General Meeting – this will be your opportunity to cast your vote. You may wish to contact your Owners Corporation Manager to ensure your contact details and preferences are up to date so you don’t miss it.
And it’s important to remember that OCs function as democracies. If the ban does pass, this indicates a majority supported it. Your Committee or Manager were not the ones to make the decision, and they cannot change it.
In Summary.
An OC may now include a rule which prohibits Lot Owners from listing their lot(s) as short stay accommodation, unless the lot is their principal place of residence. They must pass a special resolution to do so.
This is a welcome change for many OCs who have long struggled with managing the detrimental effects of some short stay guests within their communities.