Without a doubt, rental housing in Toronto is a problem, but are short-term rentals the cause?

The City of Toronto is investigating short-term rentals such as Airbnb, Flip Key and Roomorama to see whether these temporary stays are taking available homes away from people who live in Toronto. In Wednesday’s Executive Committee meeting, the council voted to report back with recommended regulations in Spring 2017.

What is in the city report?

The Executive Committee wants to create a database that provides a breakdown of every service provider and unit type, including a list of landlords running short-term rentals. The city also wants to look into cases of sexual violence in short-term stays, safety standards, and working conditions for employees. The city will look into regulating and possibly restricting temporary rentals through zoning bylaws and licensing. Another solution presented in the study is to tax companies such as Airbnb and similar businesses as hotels.

Currently, Airbnb has 9,460 units or rooms in Toronto that were rented in 2015. These rooms were run by 7,320 hosts. Sixty-eight per cent of the rentals are held in apartments and the rest consist of a single room rental. This shows that not all rentals are taking up entire residences, but also include single rooms in people’s primary homes. Research also determined that 68 per cent of rentals were hosted by people who owned a single home and 37 per cent of short-term rentals were owned by people with more than one house. The high average of people who are renting from their primary residence also shows that not many people in Toronto are trying to make a business from Airbnb, but instead use it as a way to make extra money if they are not staying in the home.

How is Airbnb reacting?

Airbnb has released a report to refute the claims that the City of Toronto needs to regulate their short-term rental stays. Airbnb report says there are 8,200 active participants using the short-term rental program, which accounts for o.7 per cent of Toronto’s housing market. The company also relayed that 46 per cent of the rentals were less than 30 days annually. This shows that people most likely use Airbnb to rent out their homes while they work abroad or are on vacation. Airbnb proves that it differs from a hotel service because most hosts are only using the service occasionally rather than as a principal business. Airbnb also pointed out that the typical home listing earned $6.650 in the last year, which would divide into $550 per month. A long-term rental would make a landlord substantially more money, which further shows that hosts are not using the Airbnb service in place of renting out their home to a possible tenant.

How are other cities approaching Airbnb?

Other cities have adopted regulation approaches, with the most extreme being New York having outright banned short-term rentals. Chicago, Seattle and Philadelphia have introduced regulations that ensure short-term rental hosts pay hotel and sales taxes for using the service. Chicago, London and San Francisco have put a cap on the number of nights per year that a property can be rented short-term. Vancouver is also in the process of introducing regulations to license short-term rentals that will allow an unlimited number of stays as long as it is the principal residence of a host.

Toronto is set to regulate temporary rentals in Spring 2017, although the details are still unknown. Licensing the various business ventures could have its merits, but restricting short-term rentals to avert the housing crisis will not work. By mandating that a host only use their principal residence, and limit the number of nights for short-term stay, it ensures that a host is not using their own home as a hotel, but is instead trying to make an extra buck when they are away from work. On the other hand, strict measures such as banning or taxing short-term rentals prevents people living in an expensive city like Toronto from profiting from their already pricey homes. Either way, the housing crisis remains and focusing on controlling short-term rentals seems to be merely a distraction from the lack of affordable housing that plagues Toronto’s future.

Author

Kaeleigh Phillips is Women's Post sustainability coordinator. She specializes in writing about issues relating to the environment, including renewable energy, cycling, and vegan recipes!

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