The NDP provincial government in B.C. has introduced legislation aimed at curbing short-term rentals in a number of regions in response to the lack of affordable long-term rental housing options. A number of popular vacation destinations including Kelowna, Summerland, Penticton, and Nanaimo will be subject to the legislation, though it’s unclear how this will impact pricing for accommodations or availability.
“The number of short-term rentals in B.C. has ballooned in recent years, removing thousands of long-term homes from the market,” said Premier David Eby in a press statement. “That’s why we’re taking strong action to rein in profit-driven mini-hotel operators, create new enforcement tools and return homes to the people who need them.”
The Short-Term Rental Accommodations Act was passed on Oct. 16 and restricts the types of short-term rentals that can be offered. It primarily targets investors with properties that are not their principal residence, and makes it illegal for them to rent out their properties for less than 90 consecutive days.
“Expedia Group (the parent company of rental booking platform VRBO) is committed to working with the province, municipalities, and our hosts on the implementation of this legislation,” said Hunter Doubt, manager of government affairs for Expedia Group. “While we are encouraged to see the province’s recognition of the importance of short-term rentals in resort and rural communities, we continue to have significant concerns about widespread primary-only restrictions, especially in areas where lodging options are limited and seasonal capacity is desperately needed.”
As the legislation stands, municipalities can opt in or opt out depending on their individual circumstances. For example, communities with a higher vacancy rate can request to opt out of the principal residence requirements. The effects of the bill won’t be immediately felt as the province is taking a phased approach to organize a task force and create the necessary infrastructure to track and enforce the law. However, as soon as the bill receives Royal Assent, platforms will be subject to significantly increased fines, with the new provincial principal residence requirement to follow on May 1, 2024. It will be applied to designated communities including municipalities with populations over 10,000 and in some instances, adjacent communities.
In a statement, Ravi Kahlon, B.C.’s minister of housing, says that short-term rental operators with multiple listings are taking homes off the long-term rental market in a bid to increase profits operating them as STRs. “The legislation is comprehensive and designed to target areas with high housing needs. It’s strong action and a thoughtful approach to tackle the growing short-term rental challenge and deliver more homes for people.”
Meanwhile, Airbnb Canada strongly disputes the government’s argument that the STR units it currently advertises will end up converting to long-term rentals and argues it will instead harm the tourism industry by limiting vacation rentals for visitors.
“The B.C. government’s legislation will not alleviate the province’s housing concerns,” said Alex Howell, policy manager with Airbnb Canada. “Instead it will make travel more unaffordable for millions of residents who travel within B.C., reduce tourism spending in communities where Airbnb hosts are often the only providers of local accommodations, and take money out of the pockets of British Columbians during an affordability crisis.”
B.C. is not the first province to take aim at STRs but its new law could serve as a framework for other provinces. Jill Green, New Brunswick’s minister for housing, is waiting on an upcoming report to see just how much of an impact STRs are having on long-term rental housing before the province make a decision on how to manage them. Nova Scotia introduced a Tourist Accommodations Registration Act in 2020 and subsequently introduced stricter rules to force platforms such as Airbnb and VRBO to comply with registration requirements or face hefty fines. The federal government is also looking into limiting STRs as the country grapples with a housing affordability crisis.
What are the new rules and who do they apply to?
Short-term rentals will only be permitted if they meet the permanent residence requirement which stipulates that the STR must be in either the host’s principal residence or in a secondary suite or accessory dwelling unit.
A secondary suite as defined by the province is a self-contained living unit with its own kitchen, sleeping area, and washroom facilities, and which is contained within a dwelling unit; an accessory dwelling unit is described as a self-contained living unit with its own kitchen, sleeping area, and washroom facilities, and which is located on the same property as a dwelling unit. It is also known as a garden suite, laneway home, carriage house, or garage suite.
Notably, the government says it will refine the law to exempt specific types of properties from being impacted, such as timeshares and fishing lodges because they are not the intended targets.
The following communities are subject to the principal residence requirement. They were selected because they have a population of more than 10,000 people or are adjacent to larger centres.
- Campbell River
- Central Saanich
- Dawson Creek
- Fort. St. John
- Lake Country
- Langley (City)
- Langley (Township)
- Maple Ridge
- New Westminster
- North Cowichan
- North Saanich
- North Vancouver (City)
- North Vancouver (District)
- Oak Bay
- Pitt Meadows
- Port Alberni
- Port Coquitlam
- Port Moody
- Pouce Coupe
- Powell River
- Prince George
- Prince Rupert
- Qualicum Beach
- Salmon Arm
- View Royal
- West Kelowna
- West Vancouver
- White Rock
- Williams Lake
When will the STR rules take effect in B.C.?
There is a graduated timeline for the rules to take effect over the next two years as the province develops a task force to deal with registration and enforcement. As soon as the bill receives Royal Assent, the maximum fine for bylaw infractions under the Offence Act will increase by 2,400 per cent to $50,000.
Next May, the principal residence requirement will take effect and by late 2024, the province plans to launch a registry and require platforms to remove listings without valid registry numbers.
How will B.C. enforce this legislation?
- The province will establish a provincial compliance and enforcement unit.
- The province will establish a short-term rental registry that will share data with local governments.
- Hosts will be required to include a provincial registration number on their listing.
- They will also have to include their business license number, if a business license is required by the local government.
- Platforms such as VRBO and Airbnb will be required to check registration numbers on host listings against the province’s registry data.
How does this affect people who have already booked on these platforms?
It’s unclear at this time how rental platforms will handle reservations for future dates. However, Airbnb Canada spokesperson Matt McNama says it is “working to minimize the impact the new law will have on the more than one million British Columbians who travel on Airbnb in the province each year.”
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