How Airbnb Created A Homeless Crisis In An Idyllic Australian Town
In the bohemian Australian seaside town of Byron Bay, rents are now higher than Sydney or Melbourne. And as Airbnb takes its toll, this small town has almost as many homeless people as Sydney.
BYRON BAY — It's a scene that is repeated almost every evening. Small groups form on the seafront, some take out a guitar around an improvised campfire among the rocks, a few acrobats hypnotize passers-by by twirling fiery bolas, and most clink glasses over a few beers, modestly covered by paper bags. They are all there to admire the sun setting behind the mountains bordering the northern tip of the beach, which stretches for about 30 kilometers, tinting the sky with shades ranging from pale pink to scarlet red.
Located at the eastern tip of Australia, an ideal geographical position where very beautiful waves are formed, Byron Bay, in New South Wales, is one of the most popular destinations for surfers. It is also home to one of the oldest surf clubs in the country, created more than a century ago, in 1907.
However, this small town of 9,000 inhabitants only became a tourist attraction at the turn of the 1970s. Until then, it was a working-class town, known then for its whaling station and its slaughterhouses.
A city run by environmentalists
Fintan Callaghan, a musician who has lived here his whole life, remembers that “when the wind blew in the wrong direction, a stench covered the whole town.” Everything changed in 1973, with the organization of the Aquarius festival – the Australian equivalent of Woodstock – in Nimbim, about 30 kilometers from the coast.
In its wake, many hippies arrived in the region, who, in addition to an alternative lifestyle, brought a real cultural and artistic dynamism. It was at this time that Fintan, back then a small child, arrived with his mother, "one of the pioneers of the Australian hippie movement, to live in a community."
These new residents also had a profound influence on local politics. Byron Bay is one of the few Australian cities that has been run by environmentalists for decades, who pride themselves on preserving the identity of their city. For example, no building is more than two stories high. McDonald's or KFC, which are omnipresent in the rest of the country, have never been able to set up there. And in the 1990s, very strong opposition in the streets and in court forced Club Med to give up on opening a vacation center. The French company left Australia for good a few years later.
It is also here that in 2001, for the first time in the country's history, land rights were recognized for the local Aboriginal community, whose presence in the region dates back more than 20,000 years.
Skyrocketing prices and rents
It is this uniqueness that has made Byron Bay a popular tourist destination – it welcomes 2.2 million holidaymakers each year – but it’s also a haven for many celebrities. The pioneer in this field is Paul Hogan, better known as Crocodile Dundee. But we could also mention Olivia Newton-John, or more recently, the Mentalist Simon Baker and Chris Hemsworth, who plays Thor in the Marvel movies, who built a huge villa estimated at more than 20 million euros.
An attractiveness that is now paid for at a high price. Byron Bay is the Australian city where property prices have increased the most: +34.8% in one year and +112% over the last five years. So much so that the median price of a typical Australian home – a single-story house with two bedrooms, a small garden and a garage – is now 1.5 million euros. Its average rent: 800 euros per week. That's more than in the Coogee district, one of Sydney's most famous beaches.
The working remotely wave
For mayor Michael Lyon (Green party), the situation worsened about ten years ago with the proliferation of short-term rentals. "We are a tourist destination, so 10% of our housing has always been dedicated to vacation rentals, which offer much better returns than long-term rentals. But the trend has definitely accelerated with the emergence of platforms like Airbnb. Today, 40% of all accommodations in Byron Bay are rented on such sites. As a result, the number of available accommodations has decreased significantly, which has led to a significant increase in rents," says Lyon.
A lot of people came in from the big cities.
Under these conditions, the smallest grain of sand can turn into a catastrophe. This is what happened last year to Fintan. "I was living with two of my daughters in a converted garage that I rented for about 250 euros a week. Then my landlord decided to turn it into a yoga studio. I don't blame him, he gave me more than three months' notice [the legal notice period in Australia is one month]. But it came at the worst possible time," he recalls.
“At that time, in the early days of COVID, a lot of people, realizing they could telecommute from anywhere, came in from the big cities," says Fintan. I visited more than 30 apartments and each time there were at least 40 people visiting. Some were willing to pay $50, $100 more per week than the posted rent or pay six months in advance, in cash! It's hard to compete when you're a single father, and a musician at that, with couples who have two salaries. But I had an impeccable record: as a tenant, I always paid my rent on time.”
Still homeless at the end of his notice, Fintan had to leave his daughters with family members while he spent his nights, for about three months, in homeless shelters more than an hour away (his hometown being devoid of them). One of his daughters had "serious mental health problems," so he finally managed to obtain one of the few social housing units available (2% to 3% of the entire rental stock) in the area and says he was “extremely fortunate.”
According to official statistics, there are nearly 200 homeless people in Byron Bay
Influencers and homeless people
Given the crowds at the "Homeless Hub", the only homeless shelter in town, many people are not so lucky. Entirely funded by donations, this organization serves hot breakfasts every day of the week. You can also take a shower, do your laundry, or get help from social workers to complete certain administrative procedures.
"It was very important to us that this place would look like any other café in town, so that the people who come here feel good, dignified, but also so that they can make connections," explains Ariana, one of the volunteers. Since the floods that ravaged the region a few months ago, she has noticed an increase in the number of homeless people, whose profile has changed: "We now have families who come with their children, but also people who work but who can no longer afford to live," she says.
Fabian, for example, has been sleeping in a tent for four months in the middle of the dunes. "I had to stop working: I'm tired because I don't sleep well and I'm cold all the time. It's the last straw for me, as a roofer, not to have a roof over my head." He had left Melbourne because he couldn't stand the confinement and is now seriously considering returning.
According to official statistics, there are nearly 200 homeless people in Byron Bay, who like Fabian, sleep in a tent in the bush or, when they still have one, in their car. The municipality is just behind Sydney (population over 5 million), where there are 272 homeless people.
It's the last straw for me, as a roofer, not to have a roof over my head.
It is in this context that last year Netflix announced the shooting of a reality show, "Byron Baes," centered on the many influencers who have taken up residence there in recent years. Through sponsored and highly paid publications, they sell a dream life punctuated by surfing trips, yoga sessions and smoothies and kombucha tastings.
This wasn't to the taste of the long-term inhabitants of the city, whose petition, asking for the prohibition of the filming, gathered more than 10,000 signatures. Because, as Michael Lyon explains, "this show does not represent our city at all."
That wasn't enough to make Netflix back down, even if "most of the sequences were shot outside the city because no business wanted to be associated with this show."
The Airbnb problem
The city councilor has recently regained a little optimism. After having pleaded for years with the government of New South Wales, he has just obtained the power to limit rentals on Airbnb to 90 nights per year, against the current 180.
But for Mandy Nolan, it is necessary to go even further. The comedian, a candidate for the Greens in the last federal elections, has placed the issue of housing at the heart of her campaign. "My priority was to eliminate tax incentives for rental investment, which are more important than for first-time buyers. It's a broken system, a symptom of ultraliberal capitalism out of control." Together with other Green elected officials she revealed, using supporting data from the land registry, that some 900 homes in the city are owned by only 89 people. Of these, none live in the region.
"Home ownership is the dream of every Australian, and it's part of our culture to get ahead in life by investing in property," says Liam Annesley, director of a real estate agency in Byron Bay, for whom business has never been so good. "In the 1980s, my parents bought a house for $78,000. When you get to the point where you can't afford to live where you live, where you work, where your kids go to school, there's a problem," he concedes.
$20 million mansion but no staff
And this crisis does not spare the most fortunate. "In this tourist town, most jobs are in the restaurant or commercial sector, and paid at minimum wage. That's too little to pay for housing on the spot. As a result, there is a general labor shortage, with some restaurants only opening four or five days a week, down from seven, because they are understaffed," says Mandy Nolan. "What's the point of having a $20 million mansion if you don't have anyone to maintain it?"
But the Labor government, elected last May, may be able to mitigate it. "They have promised to build 10,000 social housing units. It's a drop in the ocean but it's better than nothing," reassures Michael Lyon. In the meantime, the number of tents behind the dunes continues to grow...
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