A local council on the south coast of New South Wales is considering whether it can charge additional rates to holiday home owners and use the money to set up an affordable housing fund.

Shoalhaven Council has commissioned a report to consider whether it could apply for a special rate variation for people who own multiple properties, do not live in the area and are renting out their property on a short-term basis.

Mayor Amanda Findley said the money will go directly to addressing the area’s housing crisis.

“The money could be used to support housing providers working in the space by providing affordable housing in the Shoalhaven,” Ms Findley said.

“If people turned around and said, ‘I’m going to put my house up for long-term rental,’ they wouldn’t put any extra money into the fund,” she said.

Shoalhaven Mayor Amanda Findley supports the decision to charge additional rates to holiday home owners.(ABC News: Jessica Clifford.)

Housing crisis in state of emergency

A report released earlier this year by the University of NSW and the Australian Council of Social Services showed that 70% of people in the federal electorate of Gilmore, which encompasses the local government areas of Shoalhaven and Eurobodalla, are in a situation of rental stress.

Census data from 2021 showed more than 12,000 homes in the Shoalhaven were empty, many of which were being used as vacation rentals.

Peter Dover of Salt Ministries, a charity that supports the homeless, welcomed the prospect of additional funding from the council to address the issue.

“Everyone needs to see that this issue is bigger than the council and the residents,” Mr Dover said.

“The housing crisis has moved to emergency status, we need to do something now.

“I applaud the council because they are trying to do what they can.”

Holiday Home Owners Tax Won’t Help

The chairman of Australia’s leading body for short-term rental property owners said while he understood the need for action on affordable housing, additional taxes wouldn’t make a difference.

“I can see the initiative has value and it shows [the Shoalhaven mayor] take action and try to be proactive, but in the scheme of things these funds will do next to nothing,” Rob Jeffress said.

“I don’t think the solution is to target a group and say, ‘Look, we’re not really comfortable with what you’re doing and we’re going to charge you the price for providing an initiative that actually requires millions upon millions of dollars,” he said.

Ms Findley said the council was in the process of investigating whether it could ask for the special rate change to be earmarked for an affordable housing fund, but she admitted that might not be possible.

“I’m not sure that state law will be open enough to allow that to actually happen,” she said.

Council will also consider other measures such as rezoning land for more accommodation and encouraging holiday home owners to let their homes to long-term tenants.