A TOOLKIT FOR CANADIAN LOCAL GOVERNMENTS

OCTOBER 2020

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Published by GENERATION squeeze October 2020

Authors SHANNON JAMISON Principal, Third Space Community Planning Third Space Community Planning is a boutique planning consultancy based out of Victoria, B.C. led by Shannon Jamison, a city planner and this project’s primary consultant.

ERIC SWANSON Co-Executive Director, Generation Squeeze Generation Squeeze is a national research and advocacy organization working to create the conditions for young Canadians and future generations to thrive. Housing affordability is one of our key program areas, and the appropriate regulation of short term rentals is one component of that broader work. Learn more at www.gensqueeze.ca.

Design Lead CARRIE HUBKA Independent Graphic Designer, care2design care2design specializes in branding and print design and is led by Carrie Hubka, a visual communicator and graphic designer based on Vancouver Island, B.C.

Funding This toolkit was made possible with support from:

• Real Estate Foundation of BC;
• Federation of Canadian Municipalities;
• LandlordBC;
• The Vancouver Foundation; and
• Granicus.

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Advisory Committee The following people generously donated their time and expertise to advise on the development of this toolkit:

• DALLAS ALDERSON, Manager, Policy and Research, Federation of Canadian Municipalities
• CARLA SCHUK, Social Planner, City of Burnaby
• JOHN DEWEY, Executive Director, Federation of PEI Municipalities
• SHEILA FITZGERALD, President, Municipalities of Newfoundland and Labrador and Mayor, Roddickton-Bide Arm
• DAVID HUTNIAK, CEO, Landlord B.C.
• PAUL KERSHAW, Associate Professor, School of Population and Public Health, University of British Columbia, and Founder, Generation Squeeze
• JOSH VAN LOON, Senior Policy Analyst, Union of B.C. Municipalities
• JEAN-FRANÇOIS SABOURIN, Policy Advisor, Union of Municipalities du Québec
• DAVID WACHSMUTH, Canada Research Chair in Urban Governance, Assistant Professor of School of Urban Planning, and Associate Member of the Department of Geography, McGill University
• THORBEN WIEDITZ, Urban Geographer and Researcher, Fairbnb Canada

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Local Government and Stakeholders Thank you to all of the staff, elected officials and stakeholders who participated in the informational interviews that helped inform this toolkit, which included representation from:

1. Toronto, Ontario
2. Brampton, Ontario
3. London, Ontario
4. Oakville, Ontario
5. Prince Edward County, Ontario
6. Brockville, Ontario
7. Montreal, Québec
8. Charlottetown, PEI
9. Halifax, Nova Scotia
10. Whitehorse, Yukon
11. Yellowknife, Northwest Territories
12. Saskatoon, Saskatchewan
13. Burnaby, B.C.
14. Bowen Island, B.C.
15. Victoria, B.C.
16. Nelson, B.C.
17. Whistler, B.C.
18. Thompson-Nichola Regional District, B.C.
19. Tofino, B.C.
20. Association of Ontario Municipalities
21. Hospitality Newfoundland and Labrador
22. Ministry of Municipal Affairs and Housing, Province of B.C.
23. Host Compliance

Survey Respondents And thank you to the more than 100 local government staff and elected officials from across the country for participating in a national survey on STR regulations, particularly from the communities of Newfoundland and Labrador, who responded en masse!

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Creative Commons Licence This work is licensed under the Creative Commons Attribution-ShareAlike 4.0 International License. This means you are free to share (copy and redistribute the material in any medium or format) and adapt (remix, transform, and build upon the material for any purpose, even commercially) so long as you provide attribution, share any derivative works under the same licence and refrain from attempting to restrict others from doing anything the licence permits.

To view a copy of this license and its terms please visit http://creativecommons.org/licenses/by-sa/4.0/ or send a letter to Creative Commons, PO Box 1866, Mountain View, CA 94042, USA.

When providing attribution please include the authors’ names, title and year of the work, publishing organization and URL to the original.

Recommended attribution: Shannon Jamison, Eric Swanson. Regulating short term rentals: a toolkit for Canadian local governments. Generation Squeeze, 2020. Available at: https://www.gensqueeze.ca/str_toolkit_2020

A NOTE FOR LOCAL GOVERNMENT STAFF If you are writing reports to council and it would be helpful to simply copy and paste whole paragraphs or sections of this toolkit, please do so! A single attribution somewhere in the document will suffice as there is no need to provide an attribution for every instance.

Links and Footnotes This document is designed to be read and browsed digitally.

There is a footer on every page allowing quick navigation to the Table of Contents, a Glossary of Terms, and an online form where you can provide feedback and sign up to receive updates. The table of contents also contains links to each section for ease of use.

To reduce clutter, citations in footnotes are often abbreviated and hyperlinked. All websites cited in footnotes were accessed September 26th 2020 for the purposes of verifying content.

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Table of Contents

Introduction

Part 1: Background 1.1 What is a Short Term Rental? 1.2 How it Works 1.3 The Rise of STR 1.4 The Shift: Home Sharing to Commercial Operation 1.5 STR Trends in Canada 1.6 Benefits and Harms of STR 1.7 Layers of Regulation: Federal, Provincial, Local and Private Entities 1.8 Case Study: STR Regulations in BC

Part 2: Impacts of STR on Housing Availability and Affordability 2.1 Introduction 2.2 Housing-Related Benefits of STRs 2.3 Housing-Related Harms of STRs 2.4 Quantitative Research 2.5 Summary

Part 3: Regulatory Roadmap 3.1 High-Level Best Practices 3.2 Prioritizing Your Regulatory Goals 3.3 Developing a Project Plan 3.4 Gathering Data to Inform Your Approach 3.5 Establishing your Regulatory Approach 3.6 Choosing a Level of Community Engagement 3.7 5-Step Guide to Drafting STR Bylaws 3.8 5 Tips to Operationalize your Regulations 3.9 Establishing your Enforcement Approach 3.10 Developing an Enforcement Plan 3.11 Monitoring, Evaluation and Improvement 3.12 Advocating to Other Levels of Government

Part 4: Regulatory Tools 4.1 Building Safety 4.2 Business Licence and/or Permit 4.3 Business Licence Number Displayed on Online Advertisements 4.4 Density Cap 4.5 Designated Responsible Person 4.6 Fire Safety 4.7 Guest Limits 4.8 Insurance 4.9 Neighbour Notification 4.10 Night Cap 4.11 Owner-Only 4.12 Off-Street Parking Minimums 4.13 Permissions 4.14 Platform licensing 4.15 Principal Residence/Principal Dwelling Unit 4.16 Taxation 4.17 Zoning

Conclusion The case for regulation

Appendix Glossary of Terms Further Reading

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Introduction

This toolkit is a practical resource for local governments who are considering, designing or evolving their short term rental regulations. While the goal of improving housing availability and affordability is a major focus, this toolkit will serve a variety of STR policy objectives.

Online platforms like Airbnb have led to an explosion in short term rentals (“STRs”) across Canada and around the world. While there has been speculation that COVID-19 would decrease the prevalence and impacts of STRs, a recent study across 27 global markets covering the first half of 2020 showed only a modest 4.5% drop in STR revenue compared to the previous year.

While there was a dramatic dip in STR activity in the first months of the pandemic, the industry is quickly rebounding, with regional markets performing better than their urban counterparts. STRs are clearly here to stay and like any other business, they should be regulated in the public interest. Easy to say, harder to do.

The diversity of interests involved, the range of both benefits and harms, and the digital and international nature of the industry has made effective regulation and enforcement of STRs difficult. All levels of government have a role to play in getting a handle on this disruptive industry. However, as is often the case, the localized impacts and nature of STRs has pushed Canada’s local governments to the forefront. A range of local regulatory approaches are currently being tried with mixed or often unknown results. In the meantime, many local governments simply lack the capacity to tackle the issue.

We created this toolkit as a practical resource for local government elected officials and staff including business licensing clerks, bylaw enforcement officers, and policy and land use planners who are considering, designing or evolving their STR regulations. That said, our hope is that it can be useful to anyone interested in the effective regulation of STRs. Our own motivation, as an organization working to help make housing and family life affordable and sustainable for young people, our kids and all Canadians is to mitigate the impacts of STRs on the ability of residents to secure adequate housing, which is an established human right.

However, every community will have its own unique context and motivations for regulating STRs, which can include addressing neighbourhood impacts like noise, ensuring that revenue is collected or leveling the playing field between different accommodation providers. No matter your community’s priorities, whether your residents want fewer STRs, more STRs, or just better regulated STRs, or whether your community is at the cutting edge of regulations or just getting started, you should be able to find resources in this toolkit that can help.

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To put this document together we drew from the existing literature, the lead author’s professional experience designing local STR regulations, an advisory committee of academics, local government staff, provincial and federal municipal associations and housing sector representatives, an online survey of Canadian local governments, and one-on-one informational interviews with elected officials and staff from a diversity of communities across Canada.

We’re incredibly grateful for the time and expertise that everyone has shared to help make this toolkit happen. However, nothing in this document should be interpreted as reflecting the individual opinion or recommendation of any of our advisors, funding partners or stakeholders.

For our own part, Generation Squeeze has come away from this project with some basic takeaways that we think are worthwhile to share up front:

• We’re still in the early days of regulating STRs in Canada, especially when it comes to evaluating impact.
• Most local governments aren’t specifically regulating STRs. Many can be thought of as quasi-regulating through partial adaptations of existing bylaws that cover off some issues but leave other important aspects of STRs unclear or untouched, or by explicitly banning STRs but without proactive enforcement. Others are in the process of studying or developing comprehensive STR regulations, but haven’t yet finished.
• Of the small number of local governments who do have comprehensive programs in place, some are struggling with the complexity of the regulations they’ve designed, or with follow-through and enforcement.
• Local regulation would be much simpler if other levels of government used their legislative clout to introduce data sharing, platform accountability and/or registration systems (described in the Advocacy section). In the absence of this, local governments are forced to play detective, rely on third party firms for information and/or attempt to negotiate agreements with platforms who often have a strong interest in resisting regulation.
• Even without greater involvement from other levels of government, strong local regulation and enforcement programs and high levels of compliance are still possible. It just takes a proactive, digital-first approach, dedicated staff paid for by licensing fees and a regulatory program that is simple to understand and well-communicated. It can be done!
• If a community wants to prioritize residents’ right to adequate housing, the most effective approach is likely the restriction of STRs in residential zones to principal dwelling units (i.e. true home sharing). Here, definitions matter. We found that the alternative phrase “principal residence” has been inconsistently defined across Canadian STR regimes in ways that risk undermining efforts to protect housing.

This list reflects Gen Squeeze’s top-of-mind takeaways. You’ll discover your own as you read through this toolkit.

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It can take a lot of time, resources and careful thinking to put together the nuts and bolts of a local STR regulatory regime. Not only that, best practices and options are always evolving. We will be releasing updates to this toolkit, as well as additional tools and templates for practitioners over the coming months and years. SIGN UP to make sure you get toolkit updates and the latest STR regulatory resources straight to your inbox.

If at any time your community could benefit from some one-on-one STR consulting support, our certified professional planner can help - GET IN TOUCH.

Sincerely, Eric Swanson Co-Executive Director, Generation Squeeze

DISCLAIMER The toolkit has been carefully prepared and is intended to provide a summary of complex matters. It does not include all details and cannot take into account all local facts and circumstances. While the toolkit suggests a sequence of considerations, we recognize the path to regulation is not always linear. The guide refers to laws and practices that may change.

Municipalities are responsible for making local decisions, including decisions in compliance with law such as applicable statutes and regulations. For these reasons, this toolkit, as well as any links or information from other sources referred to in it, should not be relied upon as a substitute for specialized legal or professional advice in connection with any particular matter. The user is solely responsible for any use or application of this guide.

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Part 1: Background

1.1 What is a Short Term Rental?

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1.2 How it Works

The STR industry involves three main participants: Operators, Guests and Platforms.

OPERATORS "THE HOST/SELLER" | INDIVIDUALS OR BUSINESSES

• List their STR unit on platforms;
• Set the price, availability and house rules (guest limits, quiet hours);
• Approve rentals;
• Charge guests a nightly fee, optional additional fees (e.g. cleaning or accommodating extra people);
• Can include the hiring of support services such as professional cleaners; and
• Charge applicable sales taxes (with or without the help of the platforms).

GUESTS "THE BUYER" | INDIVIDUALS (OFTEN TOURISTS)

• Use platforms to search, reserve and stay in STR accommodation; and
• Pay the operator for the STR, a platform service fee and in some jurisdictions, applicable taxes that are included in the booking.

PLATFORMS "THE BROKER" | ONLINE PLATFORMS

• Connect STR operators and guests via platform websites;
• Charge a service fee to guests and receive a portion of rental revenue from operators; and
• In some jurisdictions they also collect and remit taxes on behalf of operators, which the guest pays.

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1.3 The Rise of STR

Short term rentals are not new. People have been renting out their cottages and cabins for decades through classified ads, word of mouth and online buy and sell sites (e.g. Craigslist, Kijiji).

What is new are online platforms (e.g. Airbnb, VRBO, Homeaway, Flipkey), which:

• Create designated spaces (websites) to connect STR operators and guests;
• Automate and systematize the advertising and listing process (e.g. built-in templates, suggested nightly rates); and
• Minimize the risks of sharing a dwelling unit or a private room with strangers (e.g. rating system, property damage protection, liability insurance, 24/7 customer support).

These platforms have enabled the rapid expansion of STRs and a transformation of the travel accommodation sector, with STR operators competing with traditional accommodation providers (e.g hotels, bed and breakfast) at scale.

1.4 The Shift: Home Sharing to Commercial Operation

Much of the rapid growth in the STR industry is the result of a shift in business model: from home sharing to commercial operation.

Initially, STRs largely involved operators renting out a spare room in their home while they were present, much like a bed and breakfast. Then, activity shifted towards renting out an operator’s entire home (principal dwelling unit) while they were away, for example while on vacation. Both types of activity can be considered true home sharing.

Realizing the potential for significant profit, savvy investors and others then began purchasing and/or converting principal dwelling units into full-time, entire-unit commercial short term rentals, with some operating multiple commercial STRs.

In this toolkit we consider true HOME SHARING to be STRs taking place in an operator’s principal dwelling unit.

We consider COMMERCIAL OPERATION to be STRs taking place in a unit that is not someone’s principal dwelling unit (home).

Non-principal dwelling unit STRs include vacation properties or secondary residences that aren’t the designated principal dwelling unit of the owner.

Principal Dwelling Unit STR A short term rental unit that is or is within someone’s principal dwelling unit; this term is used in place of principal residence STR to help communicate that the STR is confined to the dwelling unit (i.e. it doesn’t include other dwelling units on the same lot).

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1.5 STR Trends in Canada

The following trends are taken from the research of Dr. David Wachsmuth and colleagues from the Urban Policy and Governance Research Group at McGill University, and reflect the pre-COVID-19 state of the industry.

While there has been speculation that COVID-19 would lead to a lasting decrease in the prevalence and impacts of STRs, a recent study across 27 global markets covering the first half of 2020 showed that while there was indeed a significant drop in the early months of the pandemic, activity has since rebounded such that the sector is only experiencing a modest 4.5% drop in revenue compared to the previous year, with regional markets performing better than their urban counterparts.

This is a GROWING industry

• In 2018, $1.8 billion in revenue was generated by 103,290 Airbnb operators, which was an increase of 40% from the previous year.

Most STRs are for ENTIRE HOMES

• Depending on the community, the majority of STR listings are for entire homes/units rather than single private rooms.
• Entire home listings make up a higher proportion of active listings in rural areas than in major centres/CMAs or small communities/CAs.

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Commercial operators represent a large share of STR activity

• In established STR markets such as Toronto, Edmonton, Ottawa-Gatineau, Moncton and Halifax, close to 50% of all STRs are managed by multi-listing operators (an indicator of commercial/non-principal dwelling unit STR).

STRs are located across Canada with most growth outside major urban centres

• Close to 50% of all active STR listings are located in Toronto, Montreal, Vancouver and their surrounding communities.
• High concentrations of STR are also found in Ontario and Québec’s major urban and population centres, between Windsor and Québec City and along the West Coast of B.C.
• Concentrations of STRs can be found in all of Canada’s major urban centres, with an average annual growth rate of 19% across Canadian CMAs.
• Four small communities that are national tourist destinations account for the majority of all rural STR activity: Whistler, BC; Blue Mountains, ON; Prince Edward County, ON; and Mont Tremblant, QC.
• There is rapid growth in small and rural communities with populations of less than 10,000, with annual growth rates of 42% - 44%.

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1.6 Benefits and Harms of STR

STRs can bring both benefits and harms to local communities.

POTENTIAL LOCAL COMMUNITY BENEFITS

• Income Generation: Operators and support workers (e.g. cleaners, property managers) can earn income by providing and managing guest accommodation.
• Higher housing values: We consider this to be a harm in communities facing housing availability and affordability challenges; however, current property owners can financially benefit from an STR-induced rise in the economic value of their property.
• Greater Choice: Guests can access often-cheaper, more amenity-rich accommodation options compared to hotels, motels or B&Bs.
• Local Experiences: Guests can benefit from operators who provide personalized and localized accommodation and experiences.
• Quick, New Tourist Accommodation: STRs can add additional accommodation options without requiring the development of major infrastructure (e.g. hotel construction).
• More Efficient Use of Space: The local economy can benefit by allowing operators to rent a private room or dwelling unit that may otherwise go unused, for example a spare room or while the resident is away on vacation.
• Support for the Local Tourism Economy: To the extent that STRs can bring in more total visitors than could otherwise be attracted by or accommodated by traditional providers such as hotels, these additional visitors spend money on local activities, transportation, food and beverages.
• Greater Neighbourhood Distribution of Wealth: By attracting visitors to neighbourhoods and businesses outside of traditional tourist areas.

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POTENTIAL LOCAL COMMUNITY HARMS

• Housing Loss: STRs divert or remove potential long-term rental rooms, rental homes and purchasable principal residences from the market. The most acute housing loss is associated with non-principal dwelling unit STRs.
• Housing Unaffordability: STRs decrease the affordability of housing by making it more scarce and by increasing its economic value by enabling STR income.
• Unfair Advantages: STR operators are often not subject to the same level of regulation or taxation as traditional accommodation providers.
• Revenue Loss: Short term rental platforms and operators often don’t collect and remit municipal, provincial and federal taxes (e.g. accommodation, PST, GST/HST, and/or income tax), even if it is required by law.
• Increased Contraventions of Local Regulation: Operators or guests are often not aware of or follow specific requirements for zoning, noise, parking, business licensing and other activities.
• Community Disruption: Short term rental operators and guests may not be invested in the community in the same way that a long-term resident is and this may lead to disturbances such as increased noise or garbage.
• Reinforced Inequities: STR platforms create value from the use of residential housing and the owners/controllers of that housing are therefore privileged by the industry in a way that can reinforce systemic inequities.

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1.7 Layers of Regulation: Federal, Provincial, Local and Private Entities

Federal, provincial and local governments as well as private entities (e.g strata/condo corporations, landlords) all have a role in regulating STRs.

Federal Government

The most obvious regulatory role of the federal government with respect to STRs is ensuring that applicable federal taxes are paid by STR operators and platforms.

Ideally, the federal government would update its laws and practices to efficiently collect all currently-applicable taxes, which include:

• Personal income tax on STR income earned by unincorporated operators
• Corporate income tax on STR income earned by corporate operators
• Corporate income tax on revenue earned by STR platforms, where applicable
• GST/HST on STR accommodation rentals
• GST/HST on STR property sales

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Provincial and Territorial Governments

The role played by provincial and territorial governments in regulating STRs varies across Canada and includes measures aimed at:

• Collecting provincial sales tax
• Collecting accommodation taxes
• Classifying STR properties for property tax purposes
• Creating a central STR registration/licencing system
• Getting data from STR platforms
• Ensuring platform accountability

PROVINCIAL SALES TAX Provinces with separate provincial sales taxes include B.C., Québec, Saskatchewan and Manitoba. Of these, only B.C. and Saskatchewan have agreements in place with Airbnb to facilitate the collection and remittance of PST on behalf of guests and operators.

ACCOMMODATION TAXES Accommodation taxes have historically been applied to traditional accommodation providers over a certain threshold of rooms. Recently, there has been a concerted effort to expand the application of these taxes to STRs and to collect on taxes owed.

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Accommodation Tax Examples:

• Québec and B.C. have had agreements in place with Airbnb to collect and remit the Municipal and Regional District Tax of between 2-3% in B.C. and 3.5% Lodging Tax in Québec.
• In early 2020, the Alberta government announced plans to extend a 4% tourism levy to some STRs.
• Ontario’s Municipal Act was recently amended to allow that province’s municipalities to charge an accommodation tax on short term rentals, themselves.

PROPERTY TAXES Some provincial and territorial legislation may govern whether property that is being used for STRs classifies as residential or business, for property tax purposes.

Property Tax Examples:

• Nova Scotia recently decided that so long as the number of rooms listed for STR on a property are 4 or fewer, residential tax rates will apply.
• Municipalities in British Columbia have recently been asking the province to reclassify residential properties used for STRs as business properties under certain circumstances.

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REGISTRATION SYSTEMS Provincial registration systems can help streamline the registration, licensing and enforcement process for government authorities and STR operators, and can provide a degree of data on STR activity.

Registration System Examples

• Québec: Revised its registration system in May 2020, managed by the Tourism Ministry.
• Nova Scotia: Passed the Tourist Accommodations Registration Act requiring platforms and some STR operators to register.
• Prince Edward Island: Tourism Industry Act requires display of provincial registration numbers in online listings.
• Newfoundland and Labrador: Signaled in 2020 that new legislation would require STR operators to register.

DATA AGREEMENTS Through the collection of provincial sales taxes and accommodation taxes and the operation of centralized registration systems, provincial and territorial governments will have access to some direct data on STR activity.

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Data Agreement Examples:

• PEI: Bill passed in late 2019 to require STR platforms to share data with the province on a quarterly basis.
• Nova Scotia: Tourist Accommodations Registration Act requires platforms to keep detailed data on listings for seven years.

PLATFORM ACCOUNTABILITY MEASURES Platform accountability refers to measures aimed at ensuring STR platforms only publish listings that comply with government regulation (i.e. legal listings).

PRIVATE ENTITIES

Private entities including Condo Corporations/Strata and property owners provide an additional layer of STR authority.

• Condo/Strata Corporation: Can pass bylaws that add further restrictions or prohibitions on STRs beyond municipal bylaws.
• Property Owner/Landlord: Can prohibit tenants from using their property as a STR as defined in Residential Tenancy Acts.

LOCAL GOVERNMENT

While federal and provincial governments have critical roles to play in ensuring taxes are collected and data is shared, decisions around the scale, distribution and integration of STRs into communities are fundamentally up to local governments.

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Part 3 and Part 4 of this toolkit provide a roadmap, best practices and specific tools that local governments can use to develop a comprehensive, effective STR regulatory program.

EVOLUTION OF LOCAL REGULATIONS Beginning around 2016, in response to concerns about the harms of STRs and a lack of action by other levels of governments, many local governments across Canada began to develop new, comprehensive STR regulatory and enforcement programs.

This first wave of regulations was led by large urban centres such as Toronto, Victoria and Vancouver as well as small, tourist oriented communities such as Tofino, Whistler and Niagara on the Lake.

In Toronto, Vancouver and Victoria, regulations focused on mitigating the harms of STRs on housing availability and affordability, with all three implementing a principal residence requirement that only allow STRs in the principal dwelling unit of the operator.

In smaller, tourist oriented communities including Tofino and Whistler, emphasis was placed on modernizing existing tourist accommodation regulations and shifting from a complaints-based to a more proactive enforcement model.

Following this first wave, more and more Canadian local governments have implemented STR regulations including Prince Edward County, Oakville, Calgary, Edmonton and Canmore, while many other municipalities are currently in the process of developing regulations including Halifax, Charlottetown, Saskatoon, Yellowknife, Brampton and London.

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1.8 Case Study: STR Regulations in BC

There are more than 4,500 municipalities and local government districts across Canada. To glean insights, we completed an in-depth case study of the status of STR regulations in British Columbia.

For this study we examined all 162 municipalities and 27 regional districts in British Columbia, searching for references to the term short term rental or similar in applicable zoning and business licence bylaws.

Status of STR Regulation

• THE MAJORITY OF LOCAL B.C. GOVERNMENTS ARE SILENT ON STR. 65% of B.C. local governments lack any reference to ‘short term rental’ or similar terms in their regulations despite the fact that activity is occurring in almost all communities.

• A HANDFUL OF LOCAL GOVERNMENTS EXPLICITLY PROHIBIT STR. 4% of B.C. local governments explicitly prohibit all types of STRs via bylaws. Despite these bans, short term rental activity continues to occur.

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• A DOZEN LOCAL GOVERNMENTS ARE DEVELOPING REGULATIONS. 6% of B.C. local governments are currently in the process of developing new, comprehensive regulations including: Belcarra, Courtenay, Gibsons, Golden, Squamish, and Radium Hot Springs.

• ONE IN FIVE LOCAL GOVERNMENTS HAVE ESTABLISHED SPECIFIC STR REGULATIONS. 19% of B.C. local governments range from repurposing existing regulations to comprehensive programs.

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EXAMPLES OF BC COMMUNITIES THAT ARE SPECIFICALLY REGULATING STR

Other Key Findings

• MOTIVATIONS FOR ESTABLISHING REGULATIONS VARY. Includes protecting housing, ensuring health and safety, and preserving neighbourhood character.
• MANY DIFFERENT REGULATORY TOOLS ARE BEING UTILIZED. Refer to Part 4 for a scan of tools.
• THE PRINCIPAL RESIDENCE TOOL IS COMMON, BUT INCONSISTENTLY APPLIED. In Vancouver and Victoria, it is strictly synonymous with principal dwelling unit. in Tofino and Nelson, it can refer to the entire property including secondary suites.
• THE BUSINESS LICENSING TOOL IS USED BY ALL MUNICIPALITIES REGULATING STR. Fundamental to confirming principal residence, zoning, and safety inspections.

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• MANY COMMUNITIES ARE STRUGGLING TO EFFECTIVELY ENFORCE THEIR REGULATIONS. Due to complexity, lack of data access, or insufficient staff capacity.
• RIGOROUS EVALUATIONS ARE LACKING. Most local governments haven't yet rigorously evaluated the effectiveness of their regulations, with Vancouver being a notable exception.
• VANCOUVER REMAINS AT THE LEADING EDGE. One of the earliest adopters, reflective of many best practices.

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Part 2: Impacts of STR on Housing Availability and Affordability

2.1 Introduction

The proliferation of STRs leads to a worsening of both housing availability and affordability system-wide and over time, with non-principal dwelling unit STRs being the main culprit.

The discussion hinges on three basic types of STR:

• Principal dwelling unit STR (operator's home);
• Non-principal dwelling unit STR (secondary residence/investment property); and
• Non-dwelling unit STR (e.g. vans, boats, yurts).

If an operator lists their principal dwelling unit, then this isn't associated with the loss of an entire long-term home. Whereas if an operator is listing any other dwelling unit, a potential long-term home is being lost.

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2.2 Housing-Related Benefits of STRs

Potential housing-related benefits are largely limited to principal dwelling unit STRs.

POTENTIAL HOUSING AFFORDABILITY BENEFITS

The major benefit is that an owner or tenant is able to earn extra STR income to help afford their own shelter costs without the system losing a long-term home. This can help seniors age in place.

However, even this benefit comes with potential harms:

• Loss of individual bedrooms that might have been offered to a long-term roommate.
• Increased property economic value can lead to higher prices for future tenants or owners.

Staff Recommendation: Local governments may want to consider if there are alternative ways to financially enable residents to stay in their homes, such as incentives for repurposing large houses into separate income-generating residential units.

POTENTIAL HOUSING AVAILABILITY BENEFITS

Some argue that STR investors help finance the construction of new multi-family buildings.

Staff Recommendation: Rather than permit brand new residential units to be immediately converted into STRs, local governments should find other ways to help developers make construction pencil out, such as allowing additional height/density or using commercial zoning for STR expansions.

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2.3 Housing-Related Harms of STRs

Housing-related harms are most obviously associated with non-principal dwelling unit STR.

POTENTIAL HOUSING AFFORDABILITY HARMS

STRs decrease housing affordability in two main ways:

• Supply shrinkage: As units are converted to STRs, the supply shrinks, driving prices up.
• Higher revenue potential leads purchasers to bid up the price of housing.

POTENTIAL HOUSING AVAILABILITY HARMS

Whenever a non-principal dwelling unit is used as an STR, that unit generally cannot be used as someone’s principal home. It is therefore lost from the local housing system.

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2.4 Quantitative Research

The Urban Politics and Governance Research Group at McGill University has estimated the quantitative impact of STRs on housing in Canada.

Housing loss Canada-wide

• In 2018, 31,000 Canadian homes were "frequently rented entire homes" (FREH) and were unlikely to house a permanent resident.
• 40% of this lost housing was in Montréal, Toronto, and Vancouver. 25% was in other CMAs, 8% in CAs, and 27% in rural areas.

Variation in housing loss between communities

• Tofino, B.C.: Approximately 18% of all housing units were lost to STR in 2018.
• Lethbridge, Alberta: Less than 0.05% of housing was lost to STR.

Variation in housing loss between neighbourhoods

In Montreal, Toronto and Vancouver, the concentration of STRs ranges from less than 0.5% in outlying neighbourhoods to more than 2% or 3% in urban cores.

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STR conversions drain or outpace the impact of new construction

In 2016:

• In Downtown Montreal, Toronto Waterfront, and Gastown (Vancouver), homes lost to STR grew by an amount equivalent to 25% to 50% of new homes built that year.
• In neighbourhoods like kitsilano (Vancouver), new housing loss to STRs outpaced new construction, decreasing net available housing.

STR growth rates are highest in rural areas

• Between 2016 and 2018, the highest growth rates in FREH listings (60%) were in rural areas.

Areas of greatest harm from STRs

Communities experiencing the greatest negative impacts often have high concentrations of non-principal dwelling unit STRs and low rental vacancy rates. This is particularly prevalent in cities in B.C. and Ontario.

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Quantitative assessment of affordability impacts

US studies provide a sense of the impact:

• A 2020 study showed that at the median owner-occupancy rate zip code, if STR growth had remained flat, annual rent growth would have been cut by one fifth and home price growth by one seventh.
• A 2016 New York City study estimated that doubling the total number of Airbnb units was associated with a 6-11% increase in home values.
• A 2018 San Francisco study found that every 1% rise in Airbnb listings corresponded to a 0.06% increase in the number of rental households paying more than 50% of their income on housing.

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2.5 Summary

Housing-related benefits of STRs are largely limited to principal dwelling unit STRs, and even these are counteracted by potential harms. Harms are most directly caused by non-principal dwelling unit STRs.

Staff Recommendation: Communities experiencing low vacancy rates and high costs who wish to advance the right to adequate housing should consider regulatory tools such as the principal dwelling unit restriction that – when enforced – will decrease current and future housing loss to STRs.

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Part 3: Regulatory Roadmap

This section of the toolkit lays out a basic roadmap for designing and implementing a comprehensive STR regulatory program:

3.1 High-Level Best Practices 3.2 Prioritizing Your Regulatory Goals 3.3 Developing a Project Plan 3.4 Gathering Data to Inform Your Approach 3.5 Establishing your Regulatory Approach 3.6 Choosing a Level of Community Engagement 3.7 5-Step Guide to Drafting STR Bylaws 3.8 5 Tips to Operationalize your Regulations 3.9 Establishing your Enforcement Approach 3.10 Developing an Enforcement Plan 3.11 Monitoring, Evaluation and Improvement 3.12 Advocating to Other Levels of Government

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3.1 High-Level Best Practices

1. SAY YES TO REGULATED STR: Outright bans are hard to justify and enforce. Regulate it like the business it is.
2. NO ONE SIZE FITS ALL APPROACH: Regulations must be tailored to community priorities and context.
3. START WITH A GOAL NOT A REGULATION: Agree on specific goals before developing bylaws.
4. DEDICATE APPROPRIATE RESOURCES: Dedicated staff and financial resources are required for success.
5. REGULATE BASED ON DEGREE OF IMPACT: Non-principal dwelling unit STRs create more negative impacts and should be regulated to a higher standard.
6. REGULATIONS MUST BE ENFORCEABLE: If it cannot be enforced cost-effectively, don't include it in the bylaw.

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7. KEEP IT SIMPLE: Simple regulations achieve higher voluntary compliance.
8. STRIVE FOR CONSISTENCY: Apply existing standards (noise, parking, fire code) instead of unique punitive approaches.
9. PRIORITIZE HOUSING FOR RESIDENTS: In low vacancy areas, consider the principal dwelling unit restriction.
10. AVOID RELYING ON VOLUNTARY SUPPORT FROM PLATFORMS: Municipalities and platforms often have competing objectives.
11. UTILIZE TECHNOLOGY: Use online business licence applications and third-party data acquisition.
12. COMMUNICATE WIDELY: Sustain communication to boost voluntary compliance.
13. PROACTIVELY ENFORCE: A robust strategy must accompany regulations. Complaints-based approaches yield low compliance.
14. BE ADAPTABLE: Policies may need to change as the industry evolves.

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3.2 Prioritizing Your Regulatory Goals

HOUSING: PROTECTING HOUSING AVAILABILITY & AFFORDABILITY Restricting the type and/or number of STRs to reduce demand on housing stock.

TOURISM: SUPPORTING THE TOURISM ECONOMY THROUGH STR Being more permissive to increase tourist accommodation options and diversity.

REGULATORY EQUITY: ESTABLISHING REGULATORY AND TAX EQUITY Requiring STR operators to comply with regulations applied to hotels and B&Bs.

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HEALTH & SAFETY: ENSURING HEALTH & SAFETY OF GUESTS Requiring STRs to meet Fire and Building Code standards.

REVENUE: COLLECTING TAXES OWED & ENSURING COST RECOVERY Collecting tourism taxes and recovering administrative costs through licensing fees.

NEIGHBOURHOOD COMPATIBILITY: FOSTERING RESPECTFUL NEIGHBOURHOODS Promoting "good neighbour" behavior regarding noise, parking, and ratios.

COMPLIANCE: ACHIEVING A HIGH DEGREE OF COMPLIANCE Enhancing public trust through reporting and achieving high compliance levels.

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3 TIPS TO HELP IDENTIFY YOUR COMMUNITY’S GOALS

1. REVIEW EXISTING INPUT FROM STAKEHOLDERS: Look at past public consultations and correspondence to Council.
2. CONDUCT ADDITIONAL INFORMAL INTERVIEWS: Target a diversity of stakeholders who haven't yet shared opinions.
3. REVIEW EXISTING PLANS AND STRATEGIES: Check OCPs, Strategic Plans, and existing bylaws for priorities and gaps.

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PRIORITIZE YOUR COMMUNITY’S GOALS

Local governments should be mindful of a major incompatibility between the goals of: PROTECTING HOUSING AVAILABILITY AND AFFORDABILITY and SUPPORTING STR TOURISM (specifically via non-principal dwelling unit STR). The natural scarcity of housing and land means governments should consider making a clear choice between prioritizing housing or STR tourism.

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3.3 Developing a Project Plan

• DRAFT GOALS: As guided by previous sections.
• SCOPE: Identify if the project is a study, data collection, or full bylaw implementation.
• IDENTIFY YOUR PROJECT TEAM: Interdisciplinary team from planning, bylaw, legal, and finance.
• IDENTIFY PROPOSED STAKEHOLDERS: Hotel associations, housing advocacy groups, STR operators, and residents.
• CONFIRM YOUR BUDGET: Accounting for staff time and third-party data/monitoring costs.
• TIMELINE: Typically possible within about a year for a comprehensive program.

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• PROJECT RISKS: Early identification of potential public opposition from operators.
• GOVERNANCE: Identify which department will lead and have decision-making authority.

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3.4 Gathering Data to Inform Your Approach

Data is used to:

• ASSESS STR ACTIVITY AND ESTIMATE IMPACTS
• EVALUATE PROGRAM EFFECTIVENESS
• ENFORCE THE REGULATIONS

Two categories of data:

1. STR-SPECIFIC DATA: Number, type, and distribution of listings.
2. CONTEXTUAL DATA: Housing market or tourism-related data.

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Getting STR-Specific Data

1. RELYING ON FREE SOURCES:
   • A SIMPLE SCAN OF CURRENT LISTINGS: Manual scan of platforms (can be misleading due to seasonality).
   • AIRDNA: High-level data available for free on their website.
   • INSIDE AIRBNB: Independent, non-commercial data for major cities.
   • HOST COMPLIANCE: Provides a free high-level snapshot to prospective clients.
   • AIRBNB: Direct data sharing via "City Portal" pilot program.

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Paid Data Providers

• HOST COMPLIANCE AND AIRDNA: Detailed info on active listings, revenue, and geography for a fee.
• UNIVERSITY OF MCGILL’S URBAN POLITICS & GOVERNANCE RESEARCH GROUP: Data support focused on housing impacts.

How Much Data do You Need? "Good enough" data depends on:

• Community size and scale of STR activity
• Regulatory goals and resource constraints
• Desired degree of compliance

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Getting Contextual Data

CONTEXTUAL DATA BY GOAL, INDICATOR AND SOURCE

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3.5 Establishing your Regulatory Approach

This section includes:

• A Jurisdictional Scan
• A Sample Regulatory Program
• Community Profiles

Jurisdictional Scan We identified seventeen common STR regulatory tools across twenty-five communities, including fee amounts and grandfathering provisions.

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Sample Regulatory Program

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Community Profiles

Ten local governments with strong elements in their STR regulatory programs are profiled below.

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Community Profile: Victoria, B.C. POPULATION: 92,141

FEATURED REGULATORY ELEMENTS

• A non-principal dwelling unit STR operator must pay an annual business licence fee of $1,500.
• STRs operating in a principal dwelling unit pay $150 annually.
• In the first 6 months, the city collected over $529,000 in revenue to pay for program administration.

ASSOCIATED BEST PRACTICES

• Regulate based on degree of impact: Non-principal units are charged accordingly.
• Dedicate appropriate resources: High fees ensure revenue for the program.
• Keep it simple: Low fees for principal units encourage voluntary compliance.

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Community Profile: Nelson, B.C. POPULATION: 10,664

FEATURED REGULATORY ELEMENTS

• Night caps and density caps;
• Zoning and parking restrictions;
• Guest occupancy limits and business licence requirement.

ASSOCIATED BEST PRACTICES

• No one size fits all approach: Achieved high compliance rates due to small number of STRs (<100) and unique geography.
• Regulations must be enforceable: Context-specific factors make these complex rules enforceable.

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Community Profile: Fernie, B.C. POPULATION: 5,249

FEATURED REGULATORY ELEMENTS

• STRs only permitted in the principal dwelling unit.
• OCP explicitly prohibits secondary suites and garden homes from being used as STRs to balance the growth of the tourism economy with housing for residents.

ASSOCIATED BEST PRACTICES

• Prioritize housing for residents: Limiting STRs to principal units is the strongest tool for reducing housing loss.

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Community Profile: Vancouver, B.C. POPULATION: 675,218

FEATURED REGULATORY ELEMENTS

• STRs only permitted in the principal dwelling unit.
• Low business licence fee ($99) and simple online application.
• Agreement with Airbnb to remove unlicensed listings.
• 624 units confirmed to have delisted or converted into long-term rentals by end of 2019.

ASSOCIATED BEST PRACTICES

• Prioritize housing for residents: Significant reduction in STR-induced housing loss.
• Start with a goal not a regulation: Focused on protecting long-term supply.
• Utilize technology and keep it simple.

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Community Profile: Tofino, B.C. POPULATION: 1,932

FEATURED REGULATORY ELEMENTS

• Requirement for business licence number in all online ads.
• Hired a dedicated business licence inspector for proactive enforcement.
• Dedicated STR website clearly communicating rules and enforcement process.

ASSOCIATED BEST PRACTICES

• Be adaptable, Regulations must be enforceable.
• Dedicate appropriate resources.
• Communicate Widely.

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Community Profile: Prince Edward County, ON POPULATION: 24,735

FEATURED REGULATORY ELEMENTS

• STR density cap of 15%.
• Differentiating fees based on whether owner is present.
• Requirements related to campfires and septic field capacity.

ASSOCIATED BEST PRACTICES

• No one size fits all approach: Developed "made-in-county" approach for over 1,000 STRs.
• Strive for consistency: Rigorous program consistent with other accommodation providers.

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Community Profile: Saskatoon, SK POPULATION: 273,010

FEATURED REGULATORY ELEMENTS

• Principal dwelling unit STRs do not require a business licence.
• Non-principal units in low/medium density zones require Discretionary Use Approval.
• Provision to deny licences to non-principal units if rental vacancy rates fall below 1.5%.

ASSOCIATED BEST PRACTICES

• Strive for consistency: Consistent with "hosting boarders" regulations.
• Be adaptable: Provision baked in to handle fluctuations in vacancy rates.

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Community Profile: Charlottetown, PEI POPULATION: 36,094

FEATURED REGULATORY ELEMENTS

• Modeled five regulatory scenarios ranging from principal unit only to all types.
• Scenarios estimated impacts to both housing and tourism.

ASSOCIATED BEST PRACTICES

• Start with a goal not a regulation: Identified two primary goals in tension.
• Utilize technology: Partnership with academic researchers for detailed modeling.

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Community Profile: Toronto, ON POPULATION: 2.93 MILLION

FEATURED REGULATORY ELEMENTS

• STRs only permitted in principal dwelling units.
• Licensing and registration of STR platforms.
• Night cap of less than 28 consecutive days, maximum 180 nights per year.

ASSOCIATED BEST PRACTICES

• Prioritize housing for residents.
• No one size fits all approach: Included platform licensing due to jurisdictional clout.

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3.6 Choosing a Level of Community Engagement

CHOOSING A LEVEL OF COMMUNITY ENGAGEMENT

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3.7 5-Step Guide to Drafting STR Bylaws

STEP 1: CHOOSE AN APPROACH

• STICK TO AMENDING EXISTING BYLAWS: Impacting business licensing, tickets, and zoning.
• DEVELOP A STANDALONE STR BYLAW: References all context in one place.

STEP 2: DETERMINE RESPONSIBILITY Determine who will draft (CAO, Solicitor, Planner) and involve the project team to remove ambiguity and create buy-in.

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STEP 3: DRAFT THE BYLAW Pay attention to:

• DEFINITIONS: well-defined terms (operator, platform, principal dwelling unit).
• GENERAL PROVISIONS: Clear rules/responsibilities.
• SEVERABILITY: Protect the balance of the bylaw if part is found illegal.
• PENALTIES: High enough to deter non-compliance.
• TRANSITION PROVISIONS: Pro-rated fees if starting mid-year.
• EFFECTIVE DATE.

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STEP 4: STAFF REVIEW Confirm enforceability and resource capacity (staff, equipment) before bringing to Council.

STEP 5: PRESENT TO COUNCIL Includes three distinct readings (tabling, discussion, approval) and potentially public notification for zoning amendments.

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3.8 5 Tips to Operationalize your Regulations

1. PRIORITIZE STAFF CONTINUITY: Allow overlap between development and enforcement staff.
2. DEVELOP A BUSINESS LICENSING PROGRAM: System for receiving and approving licences, potentially via third-party software.
3. SIMPLIFY AND STREAMLINE THE APPLICATION PROCESS: Online applications and dedicated emails.
4. COMMUNICATE THE NEW RULES WIDELY: Use digital channels to get the message out to tech-savvy operators.
5. ESTABLISH GRACE PERIODS: A 3-6 month grace period is common before proactive enforcement.

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3.9 Establishing your Enforcement Approach

Identifying your approach requires two key decisions:

1. DECIDING YOUR POSITION ON THE ENFORCEMENT CONTINUUM

2. DETERMINING YOUR ENFORCEMENT COMPLEMENT Can include:

• Relying on existing staff or hiring new STR-specific staff;
• Retaining a third party monitoring firm;
• Negotiating agreements with platforms.

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THIRD PARTY MONITORING AND COMPLIANCE FIRMS Host Compliance is the current industry leader. Services include:

• Data snapshots on STR activity;
• Address identification for operating STR;
• Operator outreach and issuance of warning letters;
• 24/7 complaint hotline.

PLATFORM AGREEMENTS Only Vancouver has successfully negotiated an agreement with Airbnb to enforce regulations by removing unlicensed listings. local governments should generally not rely on this level of cooperation.

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3.10 Developing an Enforcement Plan

An enforcement plan can include:

• GOALS of the program;
• DESCRIPTION of the approach;
• DEFINED CATEGORIES of non-compliance;
• DESCRIPTION OF ACTIONS (fines, audits, legal proceedings);
• SEQUENCING AND ESCALATION (warning to revocation);
• COMPLAINTS PROCESS;
• APPEALS PROCESS.

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3.11 Monitoring, Evaluation and Improvement

Bylaw Amendments Anticipated amendments include clearer definitions, higher business licence fees, and stiffer fines.

Measuring Impact Consult:

• Your STR Advisory Committee;
• STR Operators;
• Departmental Staff (front counter, licensing clerks).

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3.12 Advocating to Other Levels of Government

Four key areas for provincial/federal intervention:

1. Data Sharing
2. Platform Accountability
3. Provincial Registration Systems
4. Tax Fairness

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1. DATA SHARING The Problem: local governments need individual and aggregate data to regulate, but platforms aren't required to share it. The Solution: Use legislation to compel platforms to share data. The Benefits: Simplified enforcement and increased public trust.

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2. PLATFORM ACCOUNTABILITY The Problem: Platforms publish illegal listings. The Solution: Compel platforms to only publish legal listings (with verified licence numbers) and levy penalties for non-compliance. The Benefits: Fewer illegal STRs and time/money saved.

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3. PROVINCIAL TERRITORIAL REGISTRATION SYSTEMS The Problem: local governments face high administrative costs for custom licensing systems. The Solution: Establish a single provincial STR operator registry with data sharing for municipalities. The Benefits: Simplifies licensing for all parties.

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4. TAX FAIRNESS The Problem: Operators often fail to remit sales and tourism taxes, and commercial-use properties are taxed at residential rates. The Solutions: Require platforms to collect/remit taxes; allow local governments to reclassify commercial STR properties for differential tax rates.

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Part 4: Regulatory Tools

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4.1 Building Safety

PURPOSE: Protect health and well-being by ensuring STR occurs in safe, habitable units. DESCRIPTION: Requirements related to Building and Fire Code. REGULATION & ENFORCEMENT: Self-declaration in application, supporting documents, or site inspections.

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4.2 Business Licence and/or Permit

PURPOSE: Creates a database to track and monitor STRs. DESCRIPTION: Application and fee (ranging from $50 to $1500 in Canada). ANALYSIS: Proof effective for cost recovery and equity. complications arise if regimes are overly complex.

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4.3 Business Licence Number Displayed on Online Advertisements

PURPOSE: To verify compliance with licensing requirements. DESCRIPTION: Requirement to post the number in the listing description or dedicated field. ANALYSIS: Foundation of an effective enforcement program.

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4.4 Density Cap

PURPOSE: Ensures a block remains primarily residential and disperses STR activity. DESCRIPTION: Restricts STR to a total number or percentage of dwelling units in a zone. ANALYSIS: Most suitable for non-principal dwelling unit STRs.

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4.5 Designated Responsible Person

PURPOSE: Provides accountability regardless of operator availability. DESCRIPTION: Identified person who can act on behalf of the operator at all times. ANALYSIS: helpful for promoting neighbourhood compatibility and safety.

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4.6 Fire Safety

PURPOSE: Ensures STRs meet or exceed fire safety requirements. DESCRIPTION: Installation of smoke alarms, fire extinguishers, and evacuation plans. ANALYSIS: Requirements can be based on the type of STR permitted.

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4.7 Guest Limits

PURPOSE: Avoids overcrowding and reduces noise complaints. DESCRIPTION: Restrictions often based on the number of bedrooms. ANALYSIS: can be enforced proactively or on a complaints basis.

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4.8 Insurance

PURPOSE: Protects operator from liability and property damage. DESCRIPTION: Proof of liability insurance (often $1M - $3M). ANALYSIS: Requirement may create administrative burden without appreciable benefit as platforms often provide coverage.

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4.9 Neighbour Notification

PURPOSE: Encourages "good neighbour" relationships and awareness. DESCRIPTION: Requirement to notify surrounding neighbours (e.g., within 300 feet). ANALYSIS: Notification letters sent by the city ensure the message is received but require resources.

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4.10 Night Cap

PURPOSE: Ensures units are primarily residential and limits disturbances. DESCRIPTION: Restricts maximum consecutive days or total days per year (e.g., 180 days). ANALYSIS: Extremely challenging to enforce without platform cooperation. Principal residence requirement is usually more effective.

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4.11 Owner-Only

PURPOSE: Based on the idea that owners are more responsible than renters. DESCRIPTION: Renters are not allowed to operate STRs. ANALYSIS: Risks discrimination against renters and is rarely included in regulations.

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4.12 Off-Street Parking Minimums

PURPOSE: Reduces conflict over limited on-street parking. DESCRIPTION: Minimum number of spaces available to guests. ANALYSIS: More appropriate for non-principal dwelling unit STR.

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4.13 Permissions

PURPOSE: ensures proof of consent from strata or landlords. DESCRIPTION: Approval required if operator is a tenant or in a strata building. ANALYSIS: Strata and landlords have legitimate authority to add restrictions beyond municipal bylaws.

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4.14 Platform licensing

PURPOSE: Covers cost of regulation and ensures platform accountability. DESCRIPTION: All STR platforms required to receive a business licence. ANALYSIS: No Canadian municipality has successfully enforced this without higher-level government support.

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4.15 Principal Residence/Principal Dwelling Unit

PURPOSE: Protects availability of long-term housing by ensuring no entire home is lost. DESCRIPTION: STR only permitted in an operator's principal dwelling unit. ANALYSIS: Best tool for protecting housing. Consistency in definitions is critical for success.

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4.16 Taxation

PURPOSE: Revenue can fund tourism promotion or infrastructure projects. DESCRIPTION: Applying municipal accommodation tax via bylaw. ANALYSIS: Motivating factor for regulatory equity. Compliance is low without platform agreements.

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4.17 Zoning

PURPOSE: Identifies areas where STR use is permitted/prohibited. DESCRIPTION: Restricts STR to specific zones (residential, commercial, or tourist). ANALYSIS: For principal unit STR, consider allowing across all residential zones as an accessory use.

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Conclusion

The case for regulation

The diversity of interests, benefits, and harms makes STR regulation challenging. Generation Squeeze encourages local governments experiencing housing supply pressures to prioritize housing affordability and availability. Converting what could otherwise be someone's home into a short term rental is not an enshrined human right.

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Appendix

Glossary of Terms

• Bed and Breakfast: A private room rented with guest access to common spaces; operator typically lives on premises.
• CMA or CA: Census metropolitan area or census agglomeration population centers.
• Commercial Short Term Rental: STR unit not in someone's principal dwelling unit.
• Commercial Operator: Operator of a unit not their own home; often with multiple listings.
• Dwelling Unit: A suite of rooms suitable for residential occupancy with separate entrance, kitchen, and bathroom.
• Frequently Rented Entire Home Listing (FREH): Units available for rent at least half the year (183 nights) and rented at least 90 nights.
• Guest: Consumer of STR services.
• Host: Also referred to as Operator; provides accommodation.
• Hotel: Purpose-built guest accommodation in commercial zones.
• Listing: Individual STR advertised on a platform.
• Listing type: Entire dwelling unit, private room, or shared room.
• Long Term Rental: Unit rented on long-term basis via tenancy agreement.
• Multi-Listings: Operators managing two or more entire home listings.
• Non-Dwelling Unit STR: Units not meeting full dwelling definition (vans, yurts).
• Principal Dwelling Unit: The usual dwelling where an individual lives and conducts daily affairs.
• Short Term Rental ("STR"): Rental of a unit for a short period (less than a month).
• True Home-Sharing: STR of someone's principal dwelling unit or room within; resident may be present or away.
• Web Scraping: Process of gathering information from the Web via software.

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Further Reading

• Binzer. A Guide to Effectively Regulating Short Term Rentals at the Local Government Level. (2016).
• Wieditz. Accountable at the Source. Fairbnb (2019).
• Hotel Association of Canada. An Overview of Airbnb and the Hotel Sector in Canada. (2017).
• Sanford, DuBois. Covid-19 Impacts on Hotels and Short Term Rentals. AirDNA (2020).
• Wachsmuth et al. Short-Term Cities: Airbnb’s impact on Canadian housing markets. (2017).
• Combs et al. Short-Term Rentals in Canada: Uneven growth, uneven impacts. (2019).