https://www.realestate.com.au/news/...-from-airbnb-leasing-in-melbourne-apartments/ Capital Alliance developer bans buyers from Airbnb leasing in Melbourne apartments Nathan Mawby 05 JUN 2018 The Docklands luxury development will be among the Capital Alliance developments where buyers will be banned from leasing their apartments out short term. A MELBOURNE developer is set to ban buyers from turning their apartments into Airbnb and other short-term rentals. Buyers who breach their sales contracts could be hauled into court, face injunctions and even contempt of court if they ignored orders to stop. The move follows heavy criticism of short-term stay rentals after a spate of incidents, including a Werribee home that was trashed during a wild party where police were attacked in December last year. It also comes as the NSW state government yesterday agreed to let strata companies ban Airbnb letting in their buildings, and imposed a 180-night cap on renting properties through the service. Victoria is currently reviewing whether to regulate short-term stay accommodation. In the meantime, Capital Alliance will change the titles on their apartments to restrict owners’ rights to lease short term. Capital Alliance founder and chief executive Mohan Du said the approach was motivated by incidents like the Werribee house used for a wild party, but also by seeing drunken tourists in the lift and halls to his apartment in the past — and because buyers wanted it. “I used to live in Southbank and I experienced it first hand,” Mr Du said. “There are so many things in the news now about people throwing wild parties and making people feel uncomfortable. “And the buyers absolutely love it. Someone who is downsizing doesn’t want their neighbour changing on a weekly basis. They don’t feel safe.” A hotel component of The Docklands development including a rooftop pool and bar would still be open to the public. The newly announced NSW regulations would go a long way to fixing issues in Victoria, but in their absence it would fall to developers to find solutions, according to Ashurst real estate partner and lawyer Jason Cornwall-Jones. “In Victoria, the owners corporations still haven’t been empowered and in the absence of that, we still have to think outside the square,” Mr Cornwall-Jones said. “If someone breaches the restrictive covenant you can seek to have that enforced in court and get an injunction against them,” Mr Cornwall-Jones said. “It’s still not a criminal offence … but if the court orders you to do something it would be a very, very brave person who said they were going to ignore the order of the court.” He added that he did not believe future buyers, or tenants, would be able to object to the covenants, as they could not be sold or leased a use of the property that the initial owner did not have the right to provide. “There’s a legal maxim that no man can grant more than he holds,” Mr Cornwall-Jones said. The Docklands development being developed by Capital Alliance will be the first affected, and will also house a new five-star Marriott hotel. Mr Du said while he had not discussed Airbnb with the hotel operator, he expected other hoteliers and developers would be paying close attention to their efforts. The Docklands is 52 per cent sold after less than three months on the market, with the majority of buyers local downsizers. Capital Alliance’s approach reflected how quickly short-stay leasing had changed things, according to Tourism Accommodation Australia Victoria general manager Dougal Hollis. “The consideration of a piecemeal approach by developers to control such activity reinforces the need for government to instead consider overarching regulation of quasi-commercial Airbnb style accommodation in a residential setting,” Mr Hollis said. “(And) to provide clarity for all stakeholders regarding how such laws will apply in Victoria.” An Airbnb spokesman yesterday welcomed the NSW government decision, saying the new rules announced would make it easier for homeowners to make additional income. “This truly is a watershed moment for our community in Australia and for travellers from around the world who want local, authentic and unique experiences when they visit,” said Airbnb country manager for Australia Sam McDonagh. “The rules will be a boost for the NSW economy and a welcome relief for the countless small, local businesses who rely on the Airbnb guest dollar.” They did not comment on the Capital Alliance ban.