NSW became the first Australian state to regulate Airbnb-style letting in 2018 with its introduction of a 180 cap for investment properties in Greater Sydney. The formal legislation is still going through due process.

Earlier this year the Department announced an extension of the annual cap to the Bega Valley, along with Newcastle, Ballina, Muswellbrook, Dubbo, and parts of the Clarence Valley.

Holiday rental platform, Stayz was a strong critic against the implementation of a cap and said that it would drive up holiday accommodation costs while also failing to resolve the rental housing affordability crisis across regional NSW.

"According to ACIL Allen Economics, a 180-day cap on the availability of short-term rental accommodation across the South Coast will put $31 million of economic activity and 167 jobs at risk," said Stayz corporate affairs director, Eacham Curry.

Stayz said they are instead advocating for a register, which was included in the original proposed legislation, where properties would be listed and the little impact of STRA on the affordable housing market would be demonstrated.

The NSW Planning Department had indicated that they will undergo community consultation and also work alongside with the holiday-letting industry, so it appears that the option for councils to reject the cap remains on the cards.

At the June 30 Council meeting Cr Nadin put fourth the notice of motion to not to limit short-term rental accommodation in the Bega Valley Shire.

The motion cited an increased interest in regional tourism and that no cap on STRA premises would maximise the opportunity for tourism revenue across the Shire.

Cr Dodds opposed the motion saying that the greatest threat to the shire growing was the housing affordability crisis.

"The 180 day cap increases the possibility that some of the premises will be made available over those short to medium terms," Cr Dodds said.

"That is particularly relevant to fly-in fly-out workers to contractor coming to the shire, that's the problem- that we can't get the builders even when they're employed from somewhere else to come and build here.

"I do support the tourism industry but we need to provide housing for the shire and provide the shire with the services we require."

Cr Griff also spoke against the motion and said that although this is only a small gesture, it sends a message that housing affordability is a key priority.

Crs Fitzpatrick, Bain, Nadin, Seckold and Allen all voted in favour of the motion.

Cr Bain spoke for the motion that housing was not the responsibility of council and that most of the properties concerned were top-end holiday homes and the decisions about how to rent or lease them out should be up to those investors.

"This has got nothing to do with affordable housing, this has got everything to do with the shire and everything to do with people having their own ability to make their own investment decisions and it should not be up to a council to get in the way of that."

Cr Fitzpatrick spoke for the motion and said that he doesn't think it would increase the availability of even one property as these are not homes for those which would be rented under the affordable housing banner.

Bega Valley Shire Councillors resolved to not to cap short-term rental accommodation in the Valley.

They also resolved to write to the NSW Department of Planning, Industry and Environment to advise of their position and advocate for effective measures to address the shortage of permanent rental accommodation across the shire.

"Council's resolution aims to balance long term housing needs with short-term or holiday rentals," said Director of Community, Environment and Planning Dr Alice Howe

"The resolution means there will be no limit to how many nights people can rent their properties for short-term accommodation throughout the year, supporting the tourism industry which is critical to our shire.

"Council will advocate to the NSW Government for support and assistance to address the broader housing shortage which is impacting communities right across the state, including the Bega Valley Shire," she said.