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Real estate agents warned over holiday letting

Paul Bibby

Real estate agents across Byron Shire are being formally warned that they could face prosecution by Byron Council if illegal holiday letting is taking place at any of properties they manage.

In a move that opens up a new front in the fight against short-term letting, the council is sending letters to every real estate agency in the shire declaring that from now on they, and not just the owner of a property, could be held responsible for illegal short-term letting.

See also Byron Council has 180 holiday-lets in its sights

The letter states, ‘To date agents/agencies have expressed the view that it is the owner of the property who is responsible … and not the agency.’

‘[But] having taken legal advice, Council is of the view that a real estate agency can be held to be in breach of the law by using the land for short-term accommodation, contrary to the conditions of the development consent.’

The agencies are being told to ensure that the properties they manage are not being used for unauthorised short-term letting or face the prospect that Council ‘may commence proceedings’.

Greens councillor Michael Lyon said the letters were not an empty threat and that Council would ‘absolutely’ prosecute a local real estate agent who managed a property where illegal short-term letting was taking place.

‘We will do anything we need to to bring about the return of these properties to the long-term rental market,’ Cr Lyon said.

‘We’re under attack as a community and we are determined to tackle this issue head on.’

Sabre rattling

But agents said the letters were little more than ‘sabre rattling’ and had no legal weight.

‘I don’t think they’ve got a leg to stand on to be honest,’ said Tony Farrell, the licensee of L J Hooker Byron Bay.

‘The legal case they’re referring to in the letter to support their argument is rubbery at best. I can say that because we’ve had legal advice to that effect,’ he said.

Mr Farrell also said that an ‘enormous amount of money came into the local community and economy’ through holiday letting.

‘At our agency, three of our 14 staff do holiday letting, we employ six or seven cleaners, and I don’t know how many tradesmen,’ he said.

He also said that there were significant benefits to having agents involved in the process of letting out properties to holiday makers on a short-term basis rather than property owners doing it themselves.

‘At least when there’s an agent there’s someone with some responsibility for the property that neighbours can come to if there’s a problem. It’s much more of a problem when people are letting their rooms and their houses without an agent out and then going away.

The warning to agents comes about three weeks after similar letters were sent to more than a hundred property owners across the Shire.

The Echo understands these had a similar tone – advising owners that Council was cracking down on unauthorised letting and wasn’t afraid to prosecute if it obtained proof of non-compliance.

Cr Lyon said that 180 properties across the Shire were currently under investigation for unauthorised letting.

‘We’re compiling evidence for those properties because they’ve been flagged as being potentially in breach of their development consent orders,’ Cr Lyon said.

Precedent-setting 

He also said that he and the other Greens councillors were determined to go ahead with a precedent-setting prosecution of two landlords in the Land and Environment Court.

This case, announced more than three months ago, was intended to pave the way for a crackdown on illegal letting across the Shire and beyond.

However, the prosecution appeared to stall after Council received legal advice that it needed more evidence against the alleged offenders in order to achieve the result it was after.

This had led some to wonder whether the case would ever see the light of day, given that no proceedings have actually been filed.

But Cr Lyon was adamant the action would go ahead.

‘Yes, we’ve had some hoops to jump through, but the most important thing is that we win the case and get the precedent we need and we’re determined to proceed.

‘Only yesterday the notice of proposed orders, which is a necessary step in the process, was sent to the two landowners. I’m very confident it will go ahead.’


5 responses to “Real estate agents warned over holiday letting”

  1. John says:

    Tony Farrell of LJ Hooker states “‘The legal case they’re referring to in the letter to support their argument is rubbery at best. I can say that because we’ve had legal advice to that effect.”

    Mr Farrell should abide by his words and fight the Council in the NSW Land and Environment Court when they serve a prosecution notice on him alleging illegal holiday letting. [The court will then decide whether his] business, like so many others, is aiding and abetting an illegal, prohibited activity in Byron Shire.

    [If the real estate agents lose then they] will have to pay Council’s legal costs of the class 5 criminal prosecution. He may also have to pay a fine of up to $1.1 million and further fines of $110,000 per day if the illegal holiday let that they manage continues to holiday let after the LEC judge issues an order against his business.

  2. Trish Burt says:

    Perhaps Byron Real Estate Agents should consider the case which went before the NSW Land and Environment Court – City of Sydney v Australian Executive Apartments. The Agent didn’t contest Council’s application to the Court, knowing too well (2 previous LEC decisions against him/his cohort) that his short-term letting was an “Illegal Use” of Residential Premises.
    Australian Executive Apartments/the licensed owner was levied a fine/paid Council’s Legal fees and was issued with a Penal Notice. He’s now subject to sequestration of property, further fines plus imprisonment should he breach the Court Order.
    At the very least, the NSW Department of Fair Trading should remove licenses plus ban these law breakers from involvement in the Industry.

  3. Trish Burt says:

    Byron Real Estate Agents take note, there are already Orders issued by the NSW Land and Environment Court (LEC) against Australian Executive Apartments (AeA) – go search their Real Estate License Number. The City of Sydney took them to the LEC and there was no contest. AeA/the operator and his cohort had had two earlier judgments go against them in the LEC so there was no doubt that the properties they were operating as short-term tourist/visitor rentals were an “Illegal Use of Residential Premises”.
    They were fined, had to pay Council’s Legal Fees and a Penal Notice was issued against them. Several apartments belonging to NSW State MPs appear on the Court Orders. Gladys Berejiklian has to date failed to any all questions about ‘conflict of interest’. The NSW LNP MPs were referred to the ICAC.
    If the Orders are breached, the Penal Notice threatens further (greater) fines, sequestration of property plus imprissonment.
    The NSW Department of Fair Trading should ensure that those who break the law have their Real Estate Licenses removed and are barred from operating in the Industry, as per an assurance given on the floor of the NSW Parliament.
    Residential Housing is for the housing of Residents and Real Estate Agents are in absolutely no doubt as to what constitutes a residential tenancy agreement as opposed to a license to occupy.

  4. Harry says:

    Tony Farrell states that the legal case that Council refers to support their argument about the illegal actions of real estate agents in managing illegal holiday lets is “rubbery at best”.

    Mr Farrell needs to read long serving and well respected NSW Land and Environment Court Justice Sheahan’s judgement in depth and very carefully. His words are very specific that real estate agents are acting illegally by promoting and managing short term holiday lets

  5. Harold says:

    Tony Farrell says that he doesn’t know how many tradesmen, and he should be saying tradeswomen being non sexist,LJ Hooker Byron employs.

    Must be so many because so much damage is done to these illegal holiday lets due to them becoming party houses!

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