Bach rental owners mull action on rates
Holiday-home owners stung by rates hikes of up to 300 per cent may take legal action against the Auckland Council.
Holiday-home management company Bachcare, which lists 2000 properties online, is considering seeking a judicial review of the council’s decision to charge owners of rental holiday homes both business and targeted rates.
A group of hotels, motels and serviced apartments is already taking High Court action, claiming a targeted rate on commercial accommodation providers to pay for tourism promotion was unfair when other businesses also benefited from it.
Bachcare founder Leslie Preston said her legal advice indicated they had an equally strong legal basis for challenging the council’s decision to hit holiday homes that are rented out for more than 28 days a year.
Holiday homes in places such as Waiheke Island faced rates hikes of between 200 per cent and 300 per cent following the council’s decision to introduce targeted rates for online accommodation providers, and to class a proportion of their rates as business rates.
‘‘Our advice suggests that the council has not followed a robust decision-making approach in implementing the new rates, and has come up with a flawed outcome,’’ Preston said.
Holiday-home owners did not oppose short-term rental providers contributing to tourism funding, but the method used was unfair.
Hosts renting ‘‘room only’’ accommodation were exempt from the commercial or targeted rates, but should be treated the same as those renting out an entire house.
‘‘If you’re living in your house and renting out one or two rooms, then you’re not charged.’’
Preston said she would consult bach owners and other industry players such as Bookabach and Trade Me’s holidayhouses.co.nz before deciding to proceed with legal action.
Trade Me Property’s head of rentals, Aaron Clancy, said Trade Me was still assessing the impact of the changes, and had not yet made a decision on whether to challenge them via the courts.
‘‘We’ll wait and see how this goes before we get that drastic.’’
A larger number of Auckland properties than normal were being removed from the Holiday Houses website because owners had found it was unsustainable to rent out their accommodation as short stays under the new rules.
Preston said other regions were carefully watching the Auckland rating situation and it was important someone stood up for bach owners, who often rented out their properties out primarily so that ownership could remain in the family.
‘‘Councils are limited in what they can rate. So all across the country they’re saying ‘Holidayhome owners, we’ll sting them as they are not civically active so we can get away with it.’ ’’