As of Wednesday, May 1st, short-term rental owners will have to cease-and-desist their operations unless they fit into the new criteria set out by the BC government’s new legislation.
The operation of short-term rentals has long been profitable for those who can afford an investment property and would allow people to use it as accommodations on platforms such as Airbnb or VRBO.
Because of the severe lack of housing in BC, the Province decided it would be in the best interest of residents to ban the operation of most short-term rentals so they can be utilized on the long-term housing market or they will go up for sale.
“The effect of short-term rental apps like Airbnb, VRBO and others has been the loss of thousands of long-term rental homes in the midst of a housing crisis, driving up the cost of housing for British Columbians,” said Premier David Eby.
“That’s why our government has created balanced new rules to crack down on speculators who are effectively operating mini hotels, while also ensuring homeowners can still rent out spaces in their principal residence. As we’ve already seen, these new rules are turning short-term rentals back into homes for people who live and work in our communities.”
The Province found that over 19,000 homes were being used as short-term rentals throughout BC, and in the City of Victoria alone, there are more than 1,500 units. This is not including Victoria’s surrounding municipalities.
The new rules
Specifically, beginning on Wednesday, May 1st:
- Where populations are greater than 10,000 people, short-term rentals can only be offered in the principal residence of a host, and/or in an additional unit or suite on their property
- For communities with less than 10,000, their local governments will still be able to opt-in and create bylaws that are more restrictive
- The Principal Residence Requirement will come into effect in over 60 communities throughout BC, including all of Greater Victoria with the exception of Metchosin and Highlands
- BC is allowing “strata hotels and motels” that have been operating similarly to a hotel or motel before December 8th of last year to be exempt provided they meet the proper criteria
- Non-conforming use of property will no longer apply to short-term rentals, meaning protections set out for non-conforming short-term rentals by municipalities will no longer be valid
- Valid short-term rental hosts must display a valid business licence number on their listing
- Municipalities can request that a platform remove listings that do not display a valid business licence
- Short-term rental platforms, like Airbnb and VRBO will be required to share data with the Province
“We are in a housing crisis that requires strong action to deliver more housing for the people who live and work in our communities,” said Ravi Kahlon, Minister of Housing.
“The changes passed last fall to tackle the growing short-term rental challenges are already bringing more long-term homes back onto the market. As the rules for hosts and platforms come into effect, we are taking another strong step to deliver more long-term homes for people in communities throughout BC.”
Outraged operators
Immediately after these regulations were announced, hosts and operators of short-term rentals reached out to the Province, their municipalities and Victoria Buzz in droves to express their outrage.
“I own a legal non-conforming condo in The Janion building,” said Anurag Sharma, a disgruntled short-term rental owner shortly after the announcement.
He said he was upset that his non-conforming condo is included in the legislation — a non-confoming property being one that allowed for people to rent the property on a short-term basis prior to zoning changes made by the City of Victoria.
“I paid $2,500 for a business license to the City of Victoria, and lots more in the taxes collected through short term rentals… Paid a premium price in July this year to buy that unit from my hard earned money.”
Sharma says he has hosted students, tourists, families, many workers in different industries and people from over 20 countries since he began operating the unit as a short-term rental.
He also predicts that many cleaners’ businesses will go out of business because of this new legislation.
“How many of you or your family members stayed in an Airbnb in the past six months?” Sharma asked. “Now, pay double of what you paid in the hotels.”
The short-term rental operator did not mention to Victoria Buzz the price point of his unit but the going rate for a short-term rental in the Janion Building ranges from $127 to $320 per night.
Meanwhile, prices of hotels in Greater Victoria are listed as low as $140 per night.
Enforcement
This legislation is a first-of-its-kind across Canada and to aid municipalities in the transition, a short-term rental data portal has been created for monitoring and enforcement of regulations.
This puts some of the onus of monitoring and enforcing the rules in communities on their local governments.
In addition to empowering local governments, a Short-Term Rental Compliance Enforcement Unit has been created.
This unit will be phased in beginning on May 1st and will have the sole task of investigating illegal short-term rental operations.
They will have the ability to administer fines of between $500 and $5,000 per infraction for non-compliance.
For “day corporations” that break the rules, they may face fines of up to $10,000.
The Province notes that these fines will only be given to the operators, not guests of the short-term rental.
Opting-out
In the new legislation, there was an allowance made for communities who have had a vacancy rate of at least 3% for the last two years.
Those communities that could prove they maintained this baseline vacancy rate were given the opportunity to opt-out of the new regulations, thereby allowing short-term rentals to operate as they have been.
There are only four communities who met the criteria and who decided to opt-out and those were: West Kelowna, Fort St. John, Dawson Creek and Pouce Coupe (a small community adjacent to Dawson Creek).
Opt-in communities
Since the new regulations’ announcement last year, 17 communities who would have been exempt from the legislation because of their low population have decided to opt-in anyway.
This is being done in solidarity largely to ensure that the finite number of homes in their communities remain available for those who live and work there.
For the communities that have opted-in, the new rules will take effect on November 1st of this year.
Those 17 communities are:
- District of Kent
- District of Tofino
- Gabriola Island
- Municipality of Bowen Island
- Town of Osoyoos
- Village of Pemberton
- Mill Bay/Malahat (Electoral Area A)
- Cobble Hill (Electoral Area C)
- Cowichan Station/Sahtlam/Glenora (Electoral Area E)
- Cowichan Lake South/Skutz Falls (Electoral Area F)
- Saltair/Gulf Islands (Electoral Area G)
- North Oyster/Diamond (Electoral Area H)
- Skaha East/Okanagan Falls (Electoral Area D)
- Okanagan Lake West/West Bench (Electoral Area F)
- Skaha West/Kaleden/Apex (Electoral Area I)
- Cortes Island (Electoral Area B)
- Discovery Island – Mainland Inlets (Electoral Area C)
Most of these municipalities are also utilized as getaways for tourists during the warmer months of the year and are places where Airbnbs would have previously thrived, but removed houses from the market in the process.
What are your thoughts on the new legislation? Do you think it is being executed in a way that will bring positive change to the housing crisis in BC?
Let us know in the comments!
