Less than 2% of Sydney's housing stock is listed on Airbnb, yet the City of Sydney Council is examining a ban on short-term rentals across 11 inner-city suburbs. Krystina Cleary, founder of Cleary & Co, a prominent short-term rental management agency, says the debate is ignoring the real issue: an enforcement gap that leaves over 3,000 unregistered hosts operating illegally.
Data from the City of Sydney shows 5,454 active short-term rental listings in the local government area, but only 2,468 are officially registered under the NSW Short-Term Rental Accommodation (STRA) framework. Cleary argues that enforcing existing legislation would be more practical and equitable than imposing new bans. "I am not clear on how rentals are bypassing the STRA registration," she says. "It is a pointless exercise to make credible providers jump through hoops, yet unscrupulous operators can bypass the system entirely."
The City of Sydney motion, passed on 28 April 2026, directs the CEO to investigate restricting non-primary-residence short-term rentals in suburbs including Darlinghurst, Surry Hills, Pyrmont, Potts Point, and Chippendale, where rental vacancy rates are below 3%. Cleary says the homeowners affected bear little resemblance to large-scale investors. "Our clients are using their assets to fund retirement, visit family, or cover medical expenses," she explains. "Under a ban, these owners would be forced into a long-term rental model that does not allow personal use and caps income. It did not work in Byron Bay, and it will not work in Sydney."
Cleary emphasizes that short-term rentals represent only 0.9 to 1.6% of Sydney's total housing stock, challenging the narrative that Airbnb is a primary cause of the housing crisis. She calls the political focus on bans a "naive perspective" that ignores economic fundamentals: centrally located areas become more populated and valuable over time, and property owners have the right to decide how to use their investments.
Looking ahead, Cleary expects the market to evolve toward higher quality. "What we will see is a true five-star experience for visitors," she says. "Unscrupulous hosts and poorly presented properties have no long-term staying power." For property owners facing uncertainty, Cleary advises a personal decision based on individual circumstances, with impartial advice from professionals like Cleary & Co.
The investigation by the City of Sydney is ongoing, and no ban has been implemented. Key facts include that NSW law caps non-hosted short-term rentals in Greater Sydney at 180 days per year, with hosted properties having no cap. Bookings of 21 or more consecutive nights are exempt from the 180-day limit. The debate continues as stakeholders await the council's findings.
