The British Columbia province is making strides to alleviate the housing crisis by taking stringent action against short-term rentals. A series of new legislations are being rolled out to foster an increase in long-term rental units within the market.
“This legislation heralds a new era where tools, previously nonexistent, are now in the hands of local government to rectify the housing situation,” commented Ravi Kahlon, the Housing Minister of B.C.
Jumping into action, the government is crafting a legal short-term rentals database accessible across the province for municipalities. A distinct Short Term Rental and Compliance Department is also being established to aid municipalities levy fines for rentals operating without official licensure.
Penalties for breaking these rules are set to rise, from a daily $1,000, escalating to a hefty $3,000. The most significantly transformative rule dictates that to operate a short-term rental, the proprietor must reside in the rental property as their primary residence.
While these revised rules are seen as a favourable stride by individuals like Robert Berry from housing advocacy group Homes For Living, he also opined, “The CRD area lacks tens of thousands of homes. So, heralding 800 units as a solution is like lauding two high school graduating classes.”
However, not all responses have been positive. For Nancy Paine, CEO and founder of short-term rental management company SpaceHost, the new regulations are nothing short of devastating. Currently handling 58 units in Victoria with a workforce of 15 people, Paine revealed that she has only one client who has his primary residence in the rental property.
“The proposed rules would render every other unit in my portfolio illegal. The units I handle won’t significantly contribute to rental affordability if transitioned back into the long-term rental pool,” Paine contended. According to her, these properties, ranging from $700,000 condos to multi-million dollar ones, do not fall under affordable rental inventory.
Sharply echoing Paine’s viewpoints, Airbnb conveyed that the legislation would do more harm than good by stripping British Columbians of income, escalating travelling costs within the province, and slashing tourism spending in localities largely dependent on rentals for accommodation.
David Eby shed light on the meticulousness of the new legislation and registry that would permit a comprehensive tabulation of businesses licenced to operate rental units. “The platforms would be legally obliged to cooperate with us,” stated Eby.
These regulations only apply to municipalities with populations exceeding 10,000, but smaller ones can choose to join in if they wish. Pending approval, fines will come into effect in May 2024, with full implementation of all the changes slated for completion by the end of the following year.
