Key takeaways
- Victoria charges a 7.5% short stay levy on the full booking value — including cleaning fees and GST — on every stay under 28 days, since 1 January 2025.
- There is no statewide night cap in Victoria, contrary to common belief. Individual councils may impose their own registration or night limits.
- An owners corporation can ban short-stay letting in a strata building with a 75% majority vote. For an apartment, that risk sits above the numbers.
- Perth's regulation is lighter and occupancy higher (around 71–79% against Melbourne's 52–65%), which is why Perth's gross short-stay yields run ahead.
- Gross yield is not the number that matters. Platform fees, 15–25% management, cleaning, void nights and the levy all come off before you see anything.
Before the numbers, one rule that decides whether any of this applies to you.
Since 1 January 2025, a Victorian owners corporation can ban short stays outright by special resolution — 75% of lot owners. There is one exemption: a lot that is the owner's principal place of residence.
Your Melbourne apartment is not your principal place of residence. So if you are buying in Victoria with an Airbnb plan, three quarters of your neighbours can vote that plan away, and you have no exemption to fall back on. Check the owners corporation rules before you buy, not after.
Now the numbers.
The 7.5% levy, precisely
Victoria charges a 7.5% short stay levy on bookings under 28 consecutive nights. It applies to the total booking — including cleaning fees and GST, and excluding credit card fees. It is not charged on the profit; it is charged on the top line.
There is no statewide night cap in Victoria, which is the one thing operators there have in their favour. Western Australia is lighter still: registration, and no equivalent levy.
Melbourne and Perth are not the same trade
Published AirDNA figures vary depending on which sample you take, and honest reporting means showing that rather than picking the flattering one. City-wide, Melbourne runs around 52% occupancy at roughly A$197 a night. Inner pockets — Southbank, Docklands, Carlton — do better on rate and worse on consistency. Perth runs nearer 70% occupancy at roughly A$157.
| Measure | Melbourne | Perth |
|---|---|---|
| Occupancy | ~52% city-wide | ~70% |
| Average nightly rate | ~A$197 | ~A$157 |
| Short stay levy | 7.5% of gross | None |
| Night cap | None statewide | None |
| Owners corporation can ban | Yes, since Jan 2025 | Varies by scheme |
| Management cost | 20–25% | 15–20% |
Melbourne wins on rate and loses on occupancy, regulation and cost. Perth is the duller number that survives contact with reality better.
What actually reaches your bank account
Take the Melbourne city-wide figures at face value. 365 nights × 52% × A$197 is about A$37,400 gross. That is the number a short-stay pitch will show you.
Then subtract, in order:
- 7.5% short stay levy — roughly A$2,800, off the top line
- Platform fee — around 3%
- Management — 20–25% for a fully managed inner-city apartment
- Cleaning and linen between every stay, which at 52% occupancy is a lot of turnovers
- Furnishing — A$15,000–25,000 up front, replaced on a cycle
- Utilities, internet, consumables, all of which a long-term tenant would pay themselves
- Owners corporation fees, rates, insurance — a short-stay policy costs more than a landlord one
By the time that is done, a A$37,400 gross figure commonly nets closer to A$18,000–22,000. A long-term tenancy on the same apartment might gross A$30,000 and net A$25,000 with none of the work.
That is the honest comparison, and it is why I rarely recommend short stay to an overseas owner. The gross number is bigger. The net number often is not.
The costs specific to you as a foreign owner
None of the above includes what you pay simply for being a foreign buyer in Victoria: 8% foreign purchaser additional duty at purchase, an FIRB application fee, and the absentee owner land tax surcharge every year you hold it.
Short-stay income does not change any of those. It only changes how hard you work for the income that has to cover them.
When short stay does make sense
It can work if you are in Perth rather than Melbourne, where occupancy is higher and there is no levy; if you own in a building whose owners corporation has confirmed in writing that short stays are permitted; if you will use the property yourself for part of the year; or if you are in a genuine tourism pocket rather than a CBD tower competing with three hundred identical listings.
It does not work if you need predictable income to service a loan, if you are relying on a managing agent you have never met to protect your asset from 3am strangers, or if you have not read the owners corporation rules.
The one thing to do before you buy
Ask for the owners corporation rules and the minutes of the last two annual general meetings. You are looking for two things: whether a short-stay ban has already been passed, and whether one has been discussed. A building where owner-occupiers are agitating about short stays is a building where that 75% vote is coming.
This takes a day and it is the difference between a viable plan and an apartment you cannot use the way you intended.
If you want the real numbers on a specific building
Send me the project or the address. I will get the owners corporation rules, confirm whether short stay is permitted, and give you a net figure — after the levy, management, cleaning and the Victorian foreign owner surcharges — next to what the same apartment would net on a normal twelve-month lease.
Most of the time the boring lease wins. When it does not, I will tell you that too.