Sunshine Coast Cracks Down on Short-Term Rentals Amid Housing Crisis

The Sunshine Coast Council is approaching a decision point on short-term rental regulation that will shape the housing market from Noosa Heads to Caloundra for years to come. Queensland's state government has been moving toward a licensing framework for platforms such as Airbnb and Stayz, and local councils must now decide how far they want to go beyond whatever minimum standards Brisbane sets.

The urgency is real. The Sunshine Coast's residential vacancy rate has sat below two per cent for an extended period, according to data tracked by the Real Estate Institute of Queensland, leaving renters with almost no room to move in a corridor that has absorbed one of the fastest population growth rates of any regional area in Australia. Maroochydore, now mid-way through a decade-long CBD redevelopment anchored by the Sunshine Coast City Hall precinct on Cornmoran Street, is adding thousands of new residents, and those residents need somewhere to live that isn't a converted holiday let.

The Regulatory Gap That Still Exists

Queensland does not yet have a mandatory registration scheme for short-term rental properties, putting it behind New South Wales, which introduced a 180-night cap for non-hosted listings in Greater Sydney. The absence of a statewide register means the Sunshine Coast Council currently has limited visibility over exactly how many dwellings on streets like Alexandra Parade in Alexandra Headland or Hastings Street in Noosa Heads are operating as de facto hotels rather than permanent homes.

Estimates vary widely. Industry body Tourism Accommodation Australia has flagged that short-term rental listings on the Sunshine Coast number in the thousands, but without a formal register, precise figures remain contested. What is not contested is that median weekly rents across the Sunshine Coast have climbed sharply since 2020, with some suburbs recording asking rents above $700 per week for a standard three-bedroom house, a figure that places significant strain on service workers, healthcare staff at the Sunshine Coast University Hospital in Birtinya, and construction workers tied to the ongoing Maroochydore CBD build.

The state government's own housing policy work, including the Queensland Housing Strategy, has identified short-term rentals as a contributing factor to rental stress in high-demand coastal areas. That framing gives the council political cover to act more decisively, but also creates pressure to align with whatever statewide system eventually materialises rather than designing a patchwork of local rules.

The Decisions That Will Define the Next Six Months

Three choices are coming into focus. First, whether the council pursues its own registration or permit system ahead of state action, a move that would give it faster data but risks being superseded. Second, how to handle the Noosa Shire boundary, given that Noosa Council has already signalled stronger appetite for restrictions than its southern neighbour. A split approach could simply push listings from one postcode to another. Third, and most practically, what exemptions apply, owner-occupiers who rent a spare room occasionally are a very different policy problem from investors running a portfolio of five apartments across Mooloolaba and Kawana Waters with zero permanent tenants.

Property managers operating across the coast are watching the state budget cycle closely. Any levy or licensing fee attached to a registration scheme will directly affect their operating costs, and some smaller operators have already indicated they would consider returning properties to the long-term rental market if compliance costs rise significantly. That is precisely the outcome housing advocates have been pushing for, but it requires a fee structure high enough to change behaviour without simply being absorbed as a business expense.

For now, property owners with short-term rental listings should expect to register with whatever state system emerges, the Queensland government has flagged intent to legislate, and should begin documenting their property's use history, insurance arrangements, and body corporate compliance now. Councils, meanwhile, face a tighter window than many councillors may appreciate. The next ordinary budget cycle and planning scheme review provide the most natural vehicles for embedding local rules. Miss that window, and the decisions effectively get made by default in Brisbane.