Aug 2018 Hospitality Review2 - Digital

Aug 2018 Hospitality Review2 - Digital

The Official Journal of the Tasmanian Hospitality Association August 2018

Student Profile | Liquor and Gaming | Welcome Nick Roney

August 2018 www.tha.asn.au

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Corporate Partners

• Premium Beverages • Tasmanian Hotel & Catering Supplies • RAMS • Tourism Brochure Exchange • Wise Employment • Vanquad Vending • Moo Music • Steps • Silver Chef • JobNet • Grinders • Lion Dairy & Drinks • Parr’s Heat Pump Centre • Hoshizaki Lancer • Collins SBA • Knight Frank • PPCA • Workskills • Samuel Smith & Son • Red Bull • Tas Water • Oakley Textiles • CRE Brokers • APM

• Commonwealth Bank • National Australia Bank • Westpac Bank • Entertainment Publications • Europcar • The Smiths Snackfood Co • ERM • First Aid Training Tasmania • ANZ • Energy ROI • Qantas

August 2018 www.tha.asn.au

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28 - 29

REGULARS 2-3

2 - 3

President’s Report

4

Key Events

5

CEO Report

6-7 & 9

Membership & Corporate Report

10-11 & 13

Employment Relations Report

14-15

Workforce Development Report

17

Premier’s Report

19

Opposition Report

21

Tasmanian Police

23

Max Hitchins

25

John Fitzgerald

9

August 2018 www.tha.asn.au

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PAUL JUBB State President President’s Report

Millions of guests, millions of hosts, billions of profits. Operates on trust. Is there a catch with Airbnb? Accommodation disruptor Airbnb has become a major player in the tourism and hospitality industry worldwide, catering to consumer appetite for speedy, streamlined digital interactions.

It only takes 10 minutes to sign up and list a rental property, hosts don’t have to use their real names or provide proof of identity. They don’t even have to own the property they’re listing. In fact, lack of external regulation is one of Airbnb’s hallmarks.

The sharing economy start-up has taken a substantial bite out of the traditional accommodation business, with people with all kinds of properties, from granny flats to houseboats, jumping on board. With 4 million listings worldwide – more than the major five hotel brands combined – in 191 countries, Airbnb is currently valued at $US31 billion.

Locally, the number of people using the platformhas increased 4000% in five years, according to The Australian, and a recent Deloitte report found Airbnb guests were contributing $1.6 billion to the Australian economy.

Hidden dangers? Because registering to offer ‘guests’ temporary lodgings is as easy as posting to any social media platform, many of these ‘hosts’ are unaware of a raft of issues they may face. These include: • Town planning limitations • Body corporate involvement • Lease agreements • Security concerns • Insurance cover

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Hospitality Review

Town planning limitations kick in when a property is offered for short-term accommodation for periods of time that could legally be considered to constitute a material change of use. Commentary suggests that if the property is in an area zoned ‘residential’ this requires development approval – a process that can take months and cost thousands of dollars, with no guarantee that the council concerned will approve the application. Penalties for making an unapproved material change of use of a property can run into hundreds of thousands of dollars. If the property is an apartment or townhouse on a community titles scheme, short-term letting will likely require permission from the body corporate, covering all facilities on common property, such as balconies and car parks. Under changing strata laws, body corporates may soon have powers to enact by-laws to prohibit lots within a scheme from offering short-term accommodation.

Sub-letting a leased property often requires consent from the landlord, who might well refuse. For the host - and their neighbours - allowing transitory visitors access to their property raises security concerns, as well as issues around damage and liability.

As for insurance, a host acquires commercial business status as soon as they enter into a rental agreement with a guest. According to Airbnb itself, 95% of Airbnb hosts carry either homeowner’s or renter’s insurance.

If damage occurs or the guest is injured (or is responsible for damage or injury to someone else on the property) during their stay, liability is normally specifically excluded by homeowners’ insurance policies, while landlord’s insurance generally applies to stays of longer than 90 days, according to CHOICE Australia.

In other words, Airbnb hosts who rely on their existing insurance policies could be in for a shock if they try to call on them in respect to their paying guests.

Who should bear liability? The reality is that Airbnb properties present an unappealing profile to insurers because the risk of damage to rental properties increases with high turnover of short-term tenants – the definitive characteristics of Airbnb letting. Other risk exposures include damage to property not belonging to the host and injury suffered by guests or caused to another party during the guests’ stay.

In contrast to the highly regulated hotel and accommodation industry, amateur hosting largely operates on a trust basis. In response to this need Airbnb has developed a number of measures in an attempt to address some of these issues. They include:

• A security deposit intended to cover accidents such as spills, breakages or a key not being returned • A host guarantee, which covers up to $1,000,000 for accidental damage but involves a number of exclusions such as cash, pets and common areas • Host protection insurance, which covers up to $1,000,000 in third-party claims for injury or property damage but doesn’t extend to every country where Airbnb operates and carries conditions, limitations and exclusions. Is this likely to be adequate? Potentially no. Without additional insurance there could be gaps in the Airbnb protection that won’t cover some kinds of damage – such as a wild party at the premises with more than 30 people, for example – and liability insurance won’t protect guests from their own negligence, or actions that amount to misadventure.

The Australian insurance industry is developing products to address the needs of short-term rental hosts but the hosts themselves have to be aware that they need it, and that failure to comply with regulatory requirements may void their policies.

The push back The Airbnb issue is topical to Tasmania, with the State Government under pressure to clamp down on Airbnb (and other short-stay accommodation services) to combat affordable housing issues. The most recent overview of housing >Page 1 Page 2 Page 3 Page 4 Page 5 Page 6 Page 7 Page 8 Page 9 Page 10 Page 11 Page 12 Page 13 Page 14 Page 15 Page 16 Page 17 Page 18 Page 19 Page 20 Page 21 Page 22 Page 23 Page 24 Page 25 Page 26 Page 27 Page 28 Page 29 Page 30 Page 31 Page 32 Page 33 Page 34 Page 35 Page 36 Page 37 Page 38 Page 39 Page 40

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