Greymouth, New Zealand Short-Term Rental Regulation: A Guide For Airbnb Hosts

What are Short-Term Rental (Airbnb, VRBO) Regulations in Greymouth, New Zealand?

Short-term rentals like Airbnb and VRBO have become increasingly popular in Greymouth and throughout New Zealand. However, before starting a short-term rental business, it's crucial to understand the local regulations. This article outlines what you need to know about short-term rental rules in Greymouth.

Starting a Short-Term Rental Business in Greymouth

When starting a short-term rental business in Greymouth, the first step is to check the local zoning laws. Greymouth is part of the Grey District, and the Grey District Council has specific rules for short-term accommodations.

According to the Grey District Plan, short-term rentals are allowed in most residential zones, but there are some restrictions:

• The property must be your primary residence
• You can rent out a maximum of 4 bedrooms
• No more than 8 guests are allowed at one time
• You must provide one off-street parking space per bedroom

It's important to review the full District Plan to understand all the nuances of the short-term rental rules in your specific zone.

In addition to zoning, you'll need to create a written rental agreement outlining terms and conditions for guests. If you list on a site like Airbnb, their standard agreement may suffice, but review it to make sure it fits your needs.

You'll also want to inform your insurance company that you'll be using the property as a short-term rental. Standard homeowners insurance likely won't cover you, so you may need to pay a higher premium for the proper coverage.

Treat your rental as a business and consider forming an LLC or other entity for liability protection. You'll need to report the rental income on your taxes, but you can deduct relevant expenses.

Finally, create a detailed business plan to map out your strategy, target market, financial projections, and competitive differentiators. This will help guide your decisions and potentially secure financing if needed.

By understanding the regulations and thoughtfully planning your business, you can successfully launch a short-term rental in Greymouth. With its stunning natural beauty and friendly Kiwi hospitality, Greymouth is an appealing destination for travelers from around the world.

Short-Term Rental Licensing Requirements in Greymouth

To legally operate a short-term rental in Greymouth, you must obtain a license from the Grey District Council. Here are the key requirements and steps in the licensing process:

Requirements:

1. The property must be your primary residence
2. You can rent out a maximum of 4 bedrooms
3. No more than 8 guests are allowed at one time
4. You must provide one off-street parking space per bedroom rented

Licensing Process:

1. Check the Grey District Plan to confirm your property is zoned for short-term rentals and review any additional restrictions
2. Ensure your property meets all building and safety codes
3. Obtain written approval from your landlord or strata council if applicable
4. Prepare for a possible inspection to verify compliance
5. Submit your license application to the Grey District Council along with any required fees

Where to Apply:

Submit your short-term rental license application to:

Grey District Council
105 Tainui Street
Greymouth 7805
New Zealand

You can also email your application to info@greydc.govt.nz.

Fees:

The Grey District Council website does not specify the short-term rental licensing fees. Contact them directly for the most up-to-date fee schedule.

Processing Time:

Expect the licensing process to take at least 2-4 weeks from the time you submit your complete application. Plan accordingly and apply well in advance of when you want to start renting.

Penalties for Non-Compliance:

Operating a short-term rental without a proper license in Greymouth can result in fines and penalties. The specific amounts are not listed on the Grey District Council website.

However, in other jurisdictions, fines for unlicensed short-term rentals can reach $1000 per day of illegal operation. It's best to obtain a license to avoid potentially hefty fines and ensure you are operating your rental legally.

For the most current and complete licensing information, visit the Grey District Council website at https://www.greydc.govt.nz or contact them directly via phone at 03 769 8600 or email at info@greydc.govt.nz.

Required Documents for Greymouth Short-Term Rentals

To apply for a short-term rental license in Greymouth, you will need to provide the following documents:

1. Completed Application Form: Fill out the short-term rental license application form provided by the Grey District Council. This form collects basic information about the property owner, the rental property, and the short-term rental operation.
2. Proof of Ownership: Provide a copy of the property title or rates notice to prove you are the legal owner of the short-term rental property. If you are not the owner, you will need to provide written authorization from the owner.
3. Site Plan: Submit a site plan of the property showing the location of all buildings, parking spaces, and property boundaries. This can be a professional survey or a hand-drawn plan as long as it is accurate and to scale.
4. Floor Plan: Provide a floor plan of the short-term rental clearly showing all rooms, exits, and the locations of smoke alarms, carbon monoxide detectors, and fire extinguishers. Again, this can be a professional plan or a detailed sketch.
5. Parking Plan: Include information on the number and location of on-site parking spaces designated for short-term rental guests.
6. Proof of Insurance: Submit evidence that you have an appropriate level of insurance coverage for the short-term rental operation, typically via a Certificate of Currency from your insurance provider.
7. Fire and Safety Evacuation Plan: Provide an emergency evacuation plan to be posted inside the short-term rental unit showing fire exits and escape routes.
8. Neighbor Notification Letter: Some jurisdictions require notifying neighbors of your intent to operate a short-term rental. Check with the Grey District Council if this applies in Greymouth.
9. Application Fee: Pay the short-term rental license application fee. Contact the Grey District Council for the current fee amount.

These documents help demonstrate that your short-term rental property is safe, properly insured, can operate without negatively impacting the neighborhood, and complies with all relevant rules and regulations.

Submit your completed application with all required documents and fees to:

Grey District Council
105 Tainui Street
Greymouth 7805
New Zealand

For the most up-to-date application requirements and additional assistance, visit the Grey District Council website at https://www.greydc.govt.nz or contact their office directly.

Greymouth Short-Term Rental Taxes

When operating a short-term rental business in Greymouth, it's crucial to understand the tax obligations. The two main types of taxes that may apply are income tax and Goods and Services Tax (GST).

Income Tax

All income earned from providing short-term accommodation is taxable in New Zealand. You will need to file an income tax return to account for the rental income. The amount of tax owed will depend on your total taxable income and corresponding tax bracket.

You can claim deductions for expenses directly related to your short-term rental business, such as:

1. Mortgage interest
2. Property rates
3. Insurance
4. Utilities
5. Cleaning and maintenance costs
6. Depreciation on furniture and appliances
7. Advertising and platform fees (like Airbnb service fees)

Alternatively, you can use the "short-stay standard-cost" method. This is a fixed nightly rate that is deemed to cover all your expenses. As of the 2023-24 income year, the rates are:

1. $61 per night for homeowners
2. $55 per night for non-homeowners (like renters)

If your nightly rental charge is equal to or less than the standard-cost, the income is exempt and no taxes are owed. If you charge more, you'll owe income tax on the amount above the standard-cost. Note that you cannot claim individual expense deductions if using this method.

Goods and Services Tax (GST)

If your total annual turnover from all taxable activities, including short-term rental income, exceeds NZ$60,000, you must register for GST. Once registered, you'll need to charge 15% GST on your rental income.

You can claim back GST on any business expenses, and you'll file regular GST returns to report the GST collected and paid. If your rental income is below the $60,000 threshold, GST registration is optional.

Deductions and Write-Offs

In addition to the expense deductions noted above, you may also be able to claim:

1. Accounting and bookkeeping fees
2. A portion of your home expenses (like mortgage interest, utilities, insurance) if renting out part of your primary residence, based on floor area
3. Vehicle expenses for any travel directly related to the rental business
4. Legal fees
5. Initial repairs and setup costs when first listing the property

Be sure to keep detailed records and receipts for all expenses claimed. Consult with a qualified tax professional to optimize your deductions and ensure proper tax compliance. By understanding your tax obligations and strategically claiming deductions, you can minimize your tax bill while running a successful short-term rental business in Greymouth.

New Zealand Wide Short-Term Rental Rules

In addition to Greymouth-specific regulations, short-term rental hosts in New Zealand must comply with several nationwide rules:

Residential Tenancies Act Exemption

Short-term rentals are not covered under the Residential Tenancies Act, which governs long-term tenancies. This means the standard rental agreements and rules don't apply to Airbnb-style accommodations. Hosts should create their own written rental agreement outlining terms, conditions, and house rules.

Tax Obligations

All income earned from providing short-term accommodation is taxable and must be reported in an income tax return. Special tax rules apply depending on the type of property and its usage:

1. Standard rules apply for properties solely used for rental
2. Mixed-use asset rules apply for holiday homes also used personally
3. Under $4,000 annual rental income is tax-exempt
4. Over $4,000 is taxable and expenses can be claimed proportionally

If your total annual turnover from all taxable activities, including rental income, exceeds NZ$60,000, you must register for the Goods and Services Tax (GST) and charge 15% on rental fees. Consult a tax professional to ensure compliance.

Insurance Considerations

Standard home and contents insurance may not cover short-term rental use. Contact your insurance provider to determine if you need to pay a higher premium or secure additional coverage for:

1. Malicious or accidental damage by guests
2. Theft or burglary
3. Loss of rental income if the property becomes uninhabitable
4. Public liability for guest injuries

Some platforms like Airbnb offer limited damage protection and liability insurance, but comprehensive private insurance is still recommended.

Health and Safety Compliance

Holiday home owners have obligations under the Health and Safety at Work Act 2015 to identify and manage any property risks and hazards that could harm guests. This includes proper maintenance, installing smoke alarms, providing safety information to guests, and maintaining a hazard register.

Proposal for Nationwide Regulatory Framework

Airbnb has proposed a standardized nationwide regulatory framework for short-term rentals in New Zealand to replace the current fragmented council-by-council approach. Key components would include:

• A Code of Conduct outlining rules for guests and hosts
• Data sharing with the government for informed policy making
• A tiered regulatory system based on hosted vs unhosted properties
• Potential for councils to levy a small tourist accommodation tax

While just a proposal, this signals the government is considering a more streamlined and consistent approach to regulating short-term rentals across New Zealand. Greymouth hosts should monitor any regulatory developments that could impact their operations.

Does Greymouth Strictly Enforce STR Rules?

Based on discussions in online forums like Reddit and BiggerPockets, it appears that Greymouth and New Zealand as a whole are becoming less Airbnb-friendly compared to a few years ago. The country has implemented stricter regulations on short-term rentals in an effort to increase housing supply for long-term residents.

While some hosts may still attempt to operate STRs despite the rules, the general consensus is that enforcement has increased significantly. Airbnb and other platforms are now required to remove non-compliant listings or face hefty fines of up to $3000 per day. The provincial government plans to set up a dedicated task force to crack down on illegal short-term rentals.

Hosts have reported receiving audit notices from the government in May 2024, shortly after the new rules took effect. This suggests Greymouth is taking a proactive approach to enforcement. The city saw a drastic reduction in Airbnb listings after the law changed, indicating that many hosts have stopped operating STRs either voluntarily or due to strict enforcement.

Compared to some other global cities that have struggled to rein in Airbnb, Greymouth appears to be on the stricter end of the spectrum. While popular tourist destinations like Honolulu and New York are also cracking down, their restrictions are not as comprehensive as New Zealand's nationwide regulations.

The general advice on forums is that operating an STR in Greymouth despite the rules is very risky. With the government's increased focus on compliance and the removal of illegal listings by platforms, hosts face a high likelihood of fines and shutdowns. Greymouth seems committed to prioritizing housing for residents over tourist accommodations.

In summary, Greymouth has become much less Airbnb-friendly with the implementation of the new nationwide short-term rental regulations in 2024. The city is strictly enforcing the rules through audits and removal of non-compliant listings. Hosts should not expect to operate illegal STRs in Greymouth without facing penalties. The city is taking a hard stance compared to some other global destinations.

How to Start a Short-Term Rental Business in Greymouth

Starting a short-term rental business in Greymouth requires careful planning and adherence to local regulations. Follow these steps to successfully launch your venture:

Choose a business structure: Decide whether you want to operate as a sole trader, partnership, or company. Each structure has different legal and tax implications. Consult with a business advisor or accountant to determine the best option for your situation.

Register your business: Apply for a New Zealand Business Number (NZBN) through the Companies Office website. The NZBN is a unique 13-digit identifier for your business that is required for various business activities, such as opening a bank account and registering for GST. The fee for obtaining an NZBN is $55. Keep your business name simple, memorable, and reflective of your brand. Check the Companies Office register to ensure your desired name is available.

Register for GST: If your annual turnover exceeds NZ$60,000, you must register for Goods and Services Tax (GST). You can register online through the Inland Revenue website at no cost. Once registered, you'll need to charge 15% GST on your rental income and file regular GST returns. Even if your turnover is below the threshold, voluntarily registering for GST may be beneficial as it allows you to claim back GST on business expenses.

Obtain necessary licenses and permits: Check with the Grey District Council to determine if any specific licenses or permits are required for short-term rentals in Greymouth. You may need to register your property or obtain a resource consent. Engage with the council early in the process to avoid any delays or issues down the line.

Prepare your property: Ensure your rental property is clean, well-maintained, and equipped with all necessary amenities. Consider hiring a professional photographer to capture high-quality images of your property for your online listing. Create a detailed inventory of all furnishings and equipment to keep track of your assets and streamline the guest check-in/check-out process.

Create a rental agreement: Develop a comprehensive rental agreement that outlines the terms and conditions of the stay, including house rules, cancellation policies, and guest responsibilities. While some platforms like Airbnb provide a standard agreement, it's essential to tailor it to your specific property and needs. Have a legal professional review your rental agreement to ensure it is legally sound and protects your interests.

List your property: Choose a reputable short-term rental platform, such as Airbnb or Bookabach, to list your property. Craft a compelling listing description, highlighting your property's unique features and amenities. Set competitive rates based on market research and your target audience. Respond promptly to inquiries and maintain a high level of communication with guests to build a positive reputation and attract repeat business.

Manage your finances: Open a separate bank account for your short-term rental business to keep your personal and business finances separate. Keep accurate records of all income and expenses for tax purposes. Consider using accounting software to streamline your bookkeeping. Consult with a tax professional to ensure you are claiming all eligible deductions and meeting your tax obligations.

By following these steps and staying informed about local regulations, you can successfully launch and operate a short-term rental business in Greymouth. Remember to prioritize guest satisfaction, maintain your property to a high standard, and continually adapt to changes in the market to ensure long-term success.

Who to Contact in Greymouth about Short-Term Rental Regulations and Zoning?

If you have questions about short-term rental regulations, licensing, or zoning in Greymouth, the best place to start is by contacting the Grey District Council directly. Here is their contact information:

• Grey District Council
  Main Office: 03 769 8600
  Email: info@greydc.govt.nz
• Address:
  105 Tainui Street
  Greymouth 7805
  New Zealand
• Mailing Address:
  PO Box 382
  Greymouth 7840
  New Zealand
• Office Hours: Mon - Fri | 8:30am - 4:30pm (excluding public holidays)

The council's knowledgeable staff can guide you through the short-term rental rules, required documents, fees, and application process. They can also clarify any zoning restrictions that may apply to your property.

In addition to directly contacting the council, you can find a wealth of information and connect with fellow hosts through various online vacation rental forums and communities. Some top resources include:

BiggerPockets Forum: This is one of the largest and most active online communities for short-term rental hosts. With over 1.3 million posts, you can find discussions on nearly any topic related to running a vacation rental business.

Airbnb Community Center: If you plan to list your property on Airbnb, their official community forum is an excellent place to ask questions, share experiences, and learn from seasoned hosts. With over 1 million members, it's a robust resource.

AirBNB Hosts Subreddit: This Reddit community, found at r/AirBNBHosts, is a great place to connect with other hosts, ask for advice, and stay up-to-date on industry trends. While smaller than some other forums, the discussions tend to be focused and insightful.

Short Term Rental University Facebook Group: With over 50,000 members, this Facebook group caters to both Airbnb and VRBO hosts. It's a great place to network, troubleshoot issues, and learn strategies to optimize your rental business. The group is run by industry expert Richard Fertig.

By utilizing these official and community resources, you can navigate the short-term rental regulations in Greymouth with greater ease and confidence. Don't hesitate to reach out to the council or tap into the collective wisdom of experienced hosts online. With the right information and support, you'll be well on your way to running a successful and compliant vacation rental business in this beautiful part of New Zealand.

What Do Airbnb Hosts on Reddit and Bigger Pockets Think about Local Regulations in Greymouth?

After searching Reddit, Bigger Pockets, and other online forums, I did not find any threads or comments specifically from Airbnb hosts in Greymouth discussing their experiences with local short-term rental regulations.

However, there were some related insights from discussions about living in Greymouth and the West Coast region of New Zealand in general:

In a Reddit thread titled "What's it like living in the west coast/around greymouth?", commenters noted that Greymouth has limited job opportunities and a high proportion of "backwards thinking" people. They advised being careful with cheaper land as flooding and marshland are possible issues. Overall, the West Coast is seen as beautiful with great outdoor activities, but the lack of economic growth is a concern.

Another Reddit thread asking "Where to retire in NZ?" had a commenter recommend avoiding really small towns under 5,000 people if you don't want nosy neighbors, as "they're small enough that everyone wants to know who you are and what you're doing." This suggests Greymouth, with a population around 8,000, may allow for more privacy than tiny rural towns.

On the Bigger Pockets forums, while not Greymouth-specific, there are many discussions about navigating strict Airbnb regulations in cities worldwide. Hosts emphasize the importance of thoroughly researching local laws, getting proper licenses and permits, and maintaining positive relationships with neighbors to avoid complaints.

So while there are no direct accounts from Greymouth Airbnb hosts, the general sentiment seems to be that smaller towns come with tradeoffs - more affordable real estate and beautiful surroundings, but also economic challenges and less anonymity. As with starting an Airbnb anywhere, carefully reviewing all regulations, fees and processes with local authorities is critical.

Disclaimer: While we here at BNBCalc strive to keep all of our city regulation guides updated and accurate with all the latest local laws, we still do not suggest using them as your sole or primary source for local regulations. We also do not recommend you rely on the third-party sources we link to or reference, and we are not responsible for any of the information on these third-party sites. These guides are for entertainment purposes only and only provide basic information and should not be considered as legal advice.

We highly recommend directly contacting the responsible parties for each city and hearing what their officials have to say. Ultimately, it's your responsibility as an investor to ensure you fully comply with the local laws, and it's best to speak with professionals before making an investment decision.