According to a new report, you’re likely paying more in rent due to the increase in short-term rentals | CBC News
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A new report reveals B.C. tenants are paying more in rent due to the impact of short-term rentals, like Airbnb and Vrbo.
The study by McGill University, led by professor David Wachsmuth, found that between 2017 and 2019, the growth of short-term rental units accounted for 19.8 per cent of rent increases in the province.
The report, commissioned by the B.C. Hotel Association and released Wednesday, also said that in June 2023, 16,810 housing units were converted from residential units to dedicated short-term rentals.
“It’s actually the first time that research was able to quantify the impact that commercial short-term rental activity has had on rents … in Canada,” said Thorben Wieditz, executive director of non-profit organization Fairbnb Canada Network, a national coalition of organizations focused on establishing fair regulations for short-term rentals.
Echoing a recommendation from the report, Wieditz says B.C. needs a provincewide short-term rental registry to provide mandatory permits to hosts and to enforce requirements, such as a principal-residence restriction.
At the Union of B.C. Municipalities convention on Wednesday, Minister of Housing Ravi Kahlon said the province will be announcing new legislation in the months ahead.
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“We need it to be a provincewide solution, and so that will be reflected in the legislation that’s coming this fall where the province steps in and takes out a bigger role in addressing short-term rentals,” he said.
Short-term rentals ‘at an all-time high’
The report by Wachsmuth conducted analysis on the short-term rental market of six tourism regions in the province, including Vancouver Island, Thompson Okanagan, and Vancouver Coast and Mountains.
Compared to June 2022, the total number of rental listings active each day have gone up 17.8 per cent to an average of 28,510 listings in 2023.
Of those listings, 48.4 per cent were owned by hosts with multiple short-term rental properties.
The report notes while there was a decline in activity during the pandemic, “B.C.’s [short-term rental] market is now at an all-time high.”
Wieditz adds one of the most crucial findings of the study is that B.C. renters have paid nearly $2 billion more in rent from 2016 to 2021 due to short-term rentals.
To limit the impact on renters and the rental market, Wieditz says a provincewide registry, similar to the model in Vancouver, is necessary.
Vancouver requires registration and a licence to enlist a property online for short-term rental, which the report describes as “a Canadian success story.”
“[This means] that you and I will be able to rent out our own home when we go on vacation … But we cannot … acquire dozens and dozens and dozens of investment properties for the sole purpose of turning these over into tourist accommodations,” said Wieditz.
The City of Toronto’s short-term rental regulations from 2021 and Quebec’s provincial registration system are also cited as successful Canadian models in the report.
The study also notes that without intervention in the short-term rental market by summer 2024, the housing market will lose 19,400 units and see an additional $23 in monthly rent increases.
More data needed, says minister
Kahlon says the province has been looking to other jurisdictions, like Quebec, New York and Louisiana, to see how they are managing short-term rental properties.
He says the ministry is expecting mixed-responses when the province announces its new legislation this fall.
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On Tuesday, new rules cracking down on Airbnb came into play in the city of New York. We discuss the new restrictions with Tsur Somerville. He is a professor at the UBC Sauder School of Business and a senior fellow at UBC’s Centre for Urban Economics and Real Estate.
“But we’re in a housing crisis. We need to do something and quite frankly the time of talking is over and we need to get to the action,” he said, adding local governments also require additional data to enforce regulations.
“We need to find a way to ensure that there’s better data available for local governments so that they can actually enforce the rules that are there.”
Wieditz believes the issue can be addressed through a provincial registry to grant municipalities access to data on the rental market.
“With platform accountability comes real-time data sharing,” he said.
“That registry can then help smaller municipalities with their regulatory efforts so that they know exactly what’s going on in the housing market, who rents where [and] what’s the intensity of short-term rental activity in their jurisdiction.”
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