2021-10-12 P&E Agenda - Item 2 - Attachment 6 - Cost Benefit Analysis

COST BENEFIT ASSESSMENT – PROPOSED LOCAL LAW AMENDMENT: SHORT STAY
LETTING & HOME HOSTED ACCOMMODATION

Given the lack of complete information on the frequency of noise disturbances locally, the following noise
disturbance scenario is considered appropriate:

•     In line with Jensen, H., et al. (2019), it is assumed that 35.6% of potentially affected residents are bothered by
      disturbances from short stay accommodation premises in the absence of the proposed local law and
      experience impacts as a result.

•     A once per week noise-disturbance improvement (i.e., 52 per annum) results from the proposed local law
      affected residents.

The following assumptions underpin the estimation of potential adverse effects on other aspects of amenity from
short stay accommodation properties:

•     There is an identified benefit to residents of improved street quality at approximately $0.05 per minute spent
      on, or looking at, the street or neighbourhood (CABE, 20078).

•     5% of short stay accommodation premises do not meet general requirements for parking and waste disposal
      and are negatively impacting local street amenity 1 day per week (i.e., 52 days of the year).

•     20% of residents in surrounding properties are negatively impacted by a deterioration in the quality of the
      streetscape and residential amenity within the neighbourhood.

•     The average duration of the residential amenity impact from affected residents having to view the impacted
      streetscape and neighbourhood is 3 hours per day.

No valuation has been assigned to an improved feeling of safety within the home. This should be considered a
qualitative benefit in addition to the quantified benefits derived in the following section.

4.3.4        Quantification of Benefits
With the proposed local law in place and the avoided disturbances, there are fewer instances of insomnia,
depression, anxiety and general annoyance for those bothered by disturbances from short stay accommodation.
These avoided disturbances will result in significant health benefits relative to the status quo, which are calculated
as:
•     $1.75 million per annum for insomnia.
•     $2.23 million per annum for depression.
•     $3.69 million per annum for anxiety.
•     $1.76 million per annum for general annoyance.

The combined health benefits from the avoided amenity disturbances is estimated at $9.43 million per annum.
Other amenity improvements experienced by residents from enhanced beauty within residential neighbourhoods
is estimated at an additional $0.14 million per annum.

    IMPACT SUMMARY:

    The resident health and residential amenity benefits of avoided noise and other disturbances are considered to
    be significant for affected residents, with an estimated $9.56 million per annum benefit quantified as being
    potentially achievable via the proposed local law. All of the benefits associated with the proposed law are
    assumed to be retained within Noosa Shire given the beneficiaries are permanent local residents.




8 The impact was identified at £0.017 per minute in 2007 and has been converted to AUD based on the average AUD/GBP exchange rate in 2007

of 0.42 and indexed to 2021 Australian dollars using Australian CPI.




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