Condo Living

October 30, 2023 Published by Manitoba Chapter - By Alan Forbes

Short-term rentals in the news

From the CCI Manitoba Fall 2023 Condominium News and Views Magazine

Some time this fall, the issue of short-term rentals (STRs) will make its way through the City of Winnipeg’s council chambers. The minutes from the Feb. 2 council meeting provided the details of the proposed regulations, while the proposed bylaw changes are described in the Reports section of the agenda of the Sept. 13 Standing Policy Committee on Property and Development Regular Meeting Minutes as “16. Zoning By-law Review - Phase 1.” The subsequent step in the process was item 2 in the Reports section “Regulating Short-Term Rental Accommodations” in the Oct. 17 Executive Policy Committee Regular Meeting Minutes.” 

Note that the appendices are well detailed, with estimates for budget, a fee schedule to cover expenses and a detailed licensing and enforcement framework. The city’s project page for Regulating Short-Term Rentals also provides useful information. The next and final step in the process had STR regulations approved in the October 26, 2023 Council Regular Meeting Minutes.

News flash: On Oct. 16, British Columbia announced plans for province-wide regulations of short-term rentals, Legislation introduced to rein in short-term rentals, deliver more homes for people. The scope is extensive and the hope is to free up more homes for long-term rentals and/or sales and to address the affordability issue. B.C. now joins Quebec in taking a province-wide approach in the regulation of short-term rentals. A CBC News article from May 9, Quebec tables bill to tighten screws on Airbnb, other short-term rental platforms, indicates a further tightening of restrictions there.

Note: CCI Manitoba is planning an educational event on Jan. 18, 2024, to cover this topic. To register for this event, here is the link: Short-term rentals and rentals generally.

In the meantime, STRs continue to make news across the country, and not necessarily in a good way. The news items below highlight that, regardless of the regulatory environment, monitoring and enforcement are key. Bad hosts and bad guests are ruining it for everybody, especially for the permanent residents in condo corporations. The implications for tourism, housing affordability and availability are less clear. 

Here is a sampling of STRs in the news from the past few months:

A CBC news article on Sept. 9 described how STR licensing fees are being used to create affordable housing units in Victoria: This B.C. city is using Airbnb tax funds to build affordable rentals for hospitality workers. While there is some debate on the impact of STRs on the availability of affordable housing units, there is some merit in the approach. That said, since the licensing fees were imposed to cover the costs of regulating STRs, including monitoring and enforcement activities, one wonders if the licensing fees are being used appropriately. It seems similar to the practice of diverting gas taxes into general revenues instead of using them to repair roads. 

Vancouver was also in the STR news. A CBC News article from Sept. 14 indicates the city is raising fees to cover the costs of STR regulations: Vancouver to raise short-term rental licence fee almost tenfold to $1,000. A CTV News video clip dated July 25, Vancouver cracking down on Airbnb, discusses the impact of both legal and illegal STRs on the affordability and availability of housing.

An article from Narcity dated Sept. 14 provides STR anecdotes from around the world:  Airbnb Rentals Are Facing Crackdowns Globally and Here's What It Could Mean For Your Next Trip. Opponents of STRs approve of more restrictive regulations to reduce the impacts on crime, noise and housing availability and affordability, while proponents of STRs suggest more restrictive regulations will have significant negative impacts on tourism and result in worsening crime and noise if the regulations push STRs off of platforms such as Airbnb and onto Craigslist or Facebook Marketplace.

An article from Real Estate Magazine dated Sept. 14 —  Short-term rental rules are tightening — is it still worth investing in condos? — discusses degradation in the profitability of condo rentals as an investment with cities implementing stricter regulations for STRs. While it is very profitable using a condo as an STR, the profitability decreases if, due to stricter regulations, the condo is returned to the long-term rental market.

A Winnipeg Free Press article from Aug. 22 Loud parties, litter: cottagers struggle to deal with unruly short-term renters points out that problems are not just in downtown highrise condos but also out in cottage country. This article includes a call for “the provincial government to step in to legislate the growing industry.” The Free Press also published a related article a week earlier, on Aug. 14, Cottage communities tackling short-term rentals, which highlights several municipalities working on their own, which suggests a provincial approach would be beneficial.

A CBC News article dated Aug. 14, Canadians are being crushed by a housing crisis. Are short-term rentals to blame?, discusses the concern that STRs are contributing to the housing affordability and availability issues.

• "The emergence of short-term rental companies such as Airbnb has enabled both small investors and some large corporations to generate much higher revenues than those generated through long-term tenancies." 
• “But Airbnb said that the vast majority of Canadian hosts share just one home and entire home listings represent less than one per cent of the country's overall housing supply.” 

Three news items from Quebec highlight that monitoring and enforcement are key to the STR regulatory topic. CBC News reported on May 11 that Quebec's new Airbnb legislation could be a model for Canada — and help ease the housing crisis, yet on Aug. 2 it reported that Despite Quebec's new Airbnb legislation, illegal listings continue to flood site. An earlier news item about loss of life at an illegal STR property had been published by CTV News on March 20: Unanswered questions: Montreal mayor calls for meeting with Airbnb after fatal fire.

Alan Forbes is a director of CCI Manitoba and its vice-president. He has been the chair of the Communications Committee for the past few years and has served on the Government Relations and Advocacy Committee and also served on the Membership Committee.