The report, produced by a parliamentary inquiry chaired by independent MP Alex Greenwich, found that frontline workers including nurses, teachers, police, paramedics, and aged care staff are increasingly unable to secure affordable, long-term housing in the communities where they work.
According to the report, the short-term rental market is contributing significantly to the lack of long-term rental stock. In Sydney, Airbnb properties are occupied an average of just 71 nights per year.
Yet, they’re reducing supply and pushing up prices. Notably, more than 30 per cent of these properties are held by investors with portfolios of 10 or more listings.
Unions NSW Secretary Mark Morey said the current system is putting essential services at risk.
“Essential workers are being forced out of their communities because investors can make more money through short-term platforms than by offering stable leases,” he said.
“This is driving up housing stress and forcing people into excessive commutes—or out of the workforce altogether.”
Real estate agents and property managers have already seen the effects on rental availability and tenant demographics, especially in coastal and tourist-adjacent suburbs where investor interest in Airbnb has been strong.
Industry implications
For agents managing rent rolls or advising investor clients, the proposed 7.5 per cent short-term rental levy, modelled on Victoria’s approach, would represent a significant policy shift.
The recommendation includes funnelling the revenue directly into housing for essential workers.
Also on the table is a 60-day annual cap on un-hosted short-term rentals statewide, a change that would reduce the profitability of many current Airbnb models and likely push more properties back into the long-term market.
While the levy is not yet legislated, the growing political momentum around housing affordability suggests that property professionals should be prepared for potential regulatory changes, particularly in areas with low vacancy rates.
A recent Unions NSW survey found that 78 per cent of frontline workers in the state are in housing stress, spending more than 30 per cent of their income on accommodation.
Mr Morey said this is not sustainable.
“The Government promised to address housing affordability. We now need to see action,” he said.
Agents may increasingly find themselves working with new housing initiatives, including large-scale build-to-rent-to-buy developments, as suggested by the union as part of the solution.
Flexible definitions and planning
The report also recommends a flexible, community-based definition of “essential worker,” rather than a blanket list of professions. For developers and town planners, this could influence zoning priorities and housing approval pathways.
For now, agents and property managers are being advised to monitor legislative developments closely and consider how shifting regulation of short-term rentals could affect rental supply, investor appetite, and local housing strategies.
While the debate continues in parliament, what’s clear is that housing essential workers is fast becoming a priority issue—both socially and economically—and the property sector is firmly in the frame.
