In recent years, countless communities across Canada have implemented their own sets of short-term rental bylaws in an effort to reign in what some consider a loosely regulated industry. These regulations are typically handled at the municipal level, meaning they come in a wide range of different shapes and sizes. With so many different sets of regulations in place, it can be difficult to know exactly what rules are relevant for those looking to operate their own rental unit.
To help you navigate the maze of short-term rental regulations, we’ve compiled a list of some common and not-so-common bylaws and rules that should be on your radar if you’re at all interested in renting. Check with your local municipality to see exactly what rules are in place before renting out your property, but keep these in mind as you do:
Licensing programs have seemingly become the standard method of regulating short-term rentals. In many areas, you simply can’t operate a short-term rental property without a licence. These programs are typically used as the basis for other forms of regulation—they’re a way for local governments to account for the amount of renters in the area, ensure safety standards, and track other bylaw violations.
Here are a few common elements of licencing programs, that vary widely by community:
- Cost: Applying for a licence can cost as much as $1,500, but most licences will likely be in the ballpark of several hundred dollars.
- Length: How frequently you have to renew your short-term rental licence also varies by area, but it’s typical for them to be valid for one year at a time.
- Limit: Some areas have placed a limit on the amount of licences their municipality will give out, meaning you may not be able to immediately obtain a licence if that limit has already been reached.
Property standards are incredibly common and are typically in place to ensure a degree of safety for renters and owners. Property inspections are frequently a mandatory step in obtaining a licence, but the minimum standards vary by municipality. Here are some common requirements you should be on the lookout for:
- Parking: Depending on the bylaw, the availability of parking may determine the amount of guests you can host. Mainly, you should ensure that guests have enough space to park on your lot, so that they aren’t blocking off roads or leaving their vehicles on other properties.
- Septic: You may need to have your septic system inspected to ensure that it has the capacity to handle the amount of guests you intend to host.
- Room Density: Like parking, the amount of rooms you have may determine the amount of guests you can host. It’s common for municipalities to limit occupancy to two guests per bedroom, but some bylaws put a hard cap on the number of occupants regardless of property size.
Some communities have placed restrictions on the types of buildings and areas of the community that can be rented. For instance, the township of Seguin placed a ban on waterfront rentals, Sarnia banned residentially zoned rental units, and Collingwood prohibited the operation of none bed-and-breakfast style short-term rentals (units where the owners live in the building alongside their guests are considered bed-and-breakfast style rentals). Be sure to check how your property is zoned in case there are any local bylaws that restrict your ability to rent.
Many bylaws state that short-term rental owners must have an emergency contact who can be reached in emergency situations. In some places, these contacts only need to be reachable by phone, but in others, emergency contacts must be able to attend the rental property within a certain time frame (commonly, in under an hour), which often poses a logistical challenge for out-of-town rental operators who live far from their units.
Most short-term rental bylaws place a cap on the amount of consecutive days a unit can be rented in order to be considered a short-term rental—this is typically around 28 days. Units rented beyond that period are often no longer considered a short-term rental. Recently, the Township of Tiny drafted a bylaw which would place a limit on the amount of days units can be rented.
The enforcement of short-term rental regulations will also vary depending on your community’s bylaws. Some municipalities enforce regulations through standard fines. Others have systems in place that escalate penalties for repeat offenders, often meaning the more offences a short-term rental owner commits, the higher their fines will be. It’s important to understand your municipality’s enforcement system as the level of punishment ranges anywhere from the issuing of minor fines, to the revoking of a licence.