Last week a Legislative Council committee gave six recommendations after concerns were raised on short term accommodation's effect on the state's housing and rental markets.

It recommended including a review of safety standards, giving council's the power to issue permits, data collection on how it affected housing and requiring public liability insurance.

However the recommendations made clear short term rentals of a person's principal place of residence would be exempt.

Launceston Chamber of Commerce executive officer Neil Grose said the increase in short stay accommodation had had a significant impact on hotel viability across Australia and Launceston was no different.

"This results in lower yields for hotel owners, all of whom have significant investments in hotels, which contribute significantly to the broader economy through employment and their supply chain," he said.

"The committee's recommendation for a review of safety standards for short term accommodation seems sensible, however this will not be without cost to the business owner or to local government, who the committee recommend take the responsibility for this new compliance."

However, Mr Grose said for regional areas such as Derby and the east coast short stay's allowed for an expansion of the visitor economy.

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New hotel developments, including Hotel Verge and the five-star Fragrance hotel are planning to bring 375 new beds to the city for visitors.

Northern Tasmania Tourism chief executive officer Chris Griffin said concerns would need to be addressed in the next five years as the new hotels opened.

He said if there was a surplus of beds short term accommodation was far easier than hotels to re-purpose.

"I think it's a good thing, we have been reassured that the recommendations being putting forward aren't heavy handed," he said.

"Two things are absolutely critical, firstly the visitors experience is of high quality, we know Tasmanians are great at hosting guests for their business or in share accommodation, and more importantly visitor safety, to ensure there is appropriate fire safety measures in place."