The residential construction industry’s peak body has flagged a push for state intervention after the Hobart City Council voted to lift its short-stay accommodation application fee by 1,000%.
The Housing Industry Association (HIA) says it will lobby the local government minister to cap council fee rises at CPI, after the council voted on Monday to lift the change-of-use permit fee for short-stay accommodation from $435 to $5,000.
Tasmanian law already caps permitted application fees at $250, meaning the increase only applies to discretionary applications.
HIA Tasmanian executive director Benjamin Price said the council had failed to follow basic policy process and that he and the industry had learned of the change through an article on Pulse.
“This is terrible policy,” Price told Pulse.
“There has been, to my knowledge, zero modelling, zero engagement with the community, zero engagement with the industry and the sector that this will impact.”
He said the fee, which was buried deep in a council fees and charges document, was not the right lever to address housing supply.
“There’ll be fewer short stay homes, which means higher prices, which means investors will move straight back into short stay,” he said.
Price said the HIA would seek to have the Local Government Act amended to limit how councils set such charges.
Inside the chamber on Monday night, now-suspended councillor Louise Elliot urged affected operators to take the council to court.
“It’s very obvious that it is a penalty, it is a deterrent,” Elliot said.
“This council hates short stay. It hates the concept of private property rights. It loves control. It loves taking rights away from people and punishing them.”
She said councillors had also learned of the hike through Pulse, not council staff.
“I’m really surprised … that this didn’t come to a workshop or anything like that … no community consultation … it’s pushed straight onto the agenda,” Elliot said.
Councillor John Kelly moved to defer the item pending independent legal advice, but the motion was lost.
“This is a fine. This is a penalty. It’s a way of council trying to push this Trojan horse through to shut down this type of accommodation,” he said.
The agenda had incorrectly listed the rise as a jump from $250 to $5,000, prompting a council staffer to apologise and an on-the-night correction.
Councillor Ben Lohberger moved the amendment, saying the council had been subsidising the sector and the change was overdue cost recovery.
He said it was “problematic” the 1,000% hike was not flagged to councillors before the meeting.
“There is a rental affordability crisis in Hobart. There are many hundreds of whole houses that have been removed [from the market] because of short stay accommodation,” Lohberger said.
The council staffer said $5,000 was a mid-range estimate of the cost of assessing discretionary visitor accommodation applications, which often involve multiple officers and the planning committee.
The new fee takes effect on July 1, 2026. Applications lodged and paid for before then will be charged the existing $435.
The amendment passed 6-5, with acting lord mayor Zelinda Sherlock, Ryan Posselt, Mike Dutta, Gemma Kitsos, Ben Lohberger and Bill Harvey voting in favour.
Marti Zucco, Louise Bloomfield, Louise Elliot, Will Coats and John Kelly voted against.
