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In my suburb the local government has responded to a severe shortage of rental housing and strong pressure from the local hotel industry, and is about to drive most of the local 400 Airbnbs out of business:
A short-term rental is defined as the rental and occupation of a sleeping unit which is attached to or part of a dwelling unit, either with common cooking facilities, or where regular meals are provided. Examples of short-term rentals include but are not limited to bed and breakfasts and AirbnbÂŽ private room rentals.
City of XXXXXXXXX has specific regulations for short-term rentals to ensure the rental does not negatively impact a residential neighbourhood.
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Requirements
At least one permanent resident of the home must live in and operate the short-term rental
A maximum of two guests or one family is permitted to stay at any one time
Rental space must be less than 40% of the residential floor area
Rental space must not have separate cooking facilities. Shared cooking facilities are permitted.
This eliminates all âinvestment propertiesâ â condos people bought to rent out as Airbnb.
It also eliminates all full-kitchen inlaw suites where the owner lives upstairs or attached duplexes where the host lives in the adjacent unit.
This also eliminates âhotplate kitchenâ inlaw suites unless the guest area has open access to the hostâs kitchen, without having to go outside and re-enter the building from a separate door (thatâs what the attached to or part of a dwelling unit language means).
Many inlaw sites are deliberately designed with separate entrances and no common areas (for security reasons)) They are not eligible for the now-mandatory business license.
None of this applies directly to other members of this forum, but I offer it as an example of how the backlash against the a) withdrawal of rental properties from long-term family housing stock for use as STRs and b) competition to the established hotel business, which sees Airbnb as a form of cancer. In very different ways governments are susceptible to pressure on both these issues.
So glad that âinvestment propertiesâ are being eliminated in the area. As a homesharer this gets rid of not only some competition, but hopefully will eliminate some anti-airbnb bias - âarbitrageâ is a scourgeâŚ
Is IS self contained, but the guest suite does not have a âlegalâ kitchen â no range, just a two burner built-in stovetop, a microwave, a sink AND A REFRIGERATOR (AND COUNTERtops/cabinets & table and chairs.
We always say to guests at checkin if they want to use our upstairs oven to bake a roast or something, they are welcome to it⌠but nobody has ever taken us upon it.
Some guests NEVER cook â all meals out or delivered, others three meals a day.
Now we have to re-cast that kitchen as a âcommon areaâ suitable for eating meals and storing food
That isnât like the B.C., Canada regs. In BC, in the areas affected, the host has to share their own residence with guests- they canât just buy an apartment to live in and have another entire apartment to rent out. While the Nice regulations seem like they effectively eliminate remote hosts, who donât live in the area, which the BC regs also do, the Nice regs wouldnât result in more long term housing being available, if a host can still rent out a entirely different apartment short term.
In New South Wales, my state in Australia, a review was done about 4 years ago. In greater Sydney, if your listing was unhosted, you are limited to 180 days rental a year, 21 day rentals do not count towards this total.
Your local council could join in and apply their own limitations.
The Byron Bay Area goes to 60 nights a year, unhosted this September. Currently there are over 3000 listings and LTR access has had limited availability for a number of years. I canât see these STR going to longer rental periods as they can be very expensive and unaffordable for the lower income demographic they want to house.
My town has no night limitations, but there is a new review coming up and I can see this coming in. My listings are all old heritage homes, so I am looking at some sort of tourism approach which will take my business out of a general residential representation.
The other twist will be that if your are managing someone elseâs listing, you must have a real estate agent accreditationâŚâŚthat will upset the arbitrage model.
muddy @Spark So do you have to now let guests share your kitchen? I think you have a self-contained unit in your house with its own kitchen?
As it turns out, itâs worse than that.
If the on-site inspection determines that my guest suite kitchen (now re-named the âcommon roomâ) is used for food preparation, we do not get a business license. The presence of a microwave will disqualify us. The presence of a two-burner built-in glass stovetop MAY disqualify us unless we can convince the inspector it is only used to âheat the teakettle.â
We have to take all pots and pans and cooking tools out for the inspection, and somehow walk a fine line by not making âfood preparation areaâ obvious in our listing, but still signalling to guests that there is a common room âfor meals.â (Itâs legal for the guests to eat in the guest suite, as long as the food is prepared elsewhere in the house.
That seems unnecessarily harsh. I thought the purpose of the legislation was to get rid of remote "investor " hosts, and âentire houseâ hosts, making more housing available to locals who live and work in the area, and get rid of those entire place listings that disturb the neighbors.
I donât understand why it matters whether guests have a place to heat up take-out or fry an egg in their suite when the host also lives there. Are the powers that be assuming that if thereâs any sort of food prep area, that the place qualifies as something that could be rented out to full-time tenants and therefore you are taking long-term housing off the market? Even if you wouldnât ever choose to rent it to tenants?
Thing is â not one of my guests for the past 10 years would ever switch to a hotel even if every Airbnb in this little suburb closed down â they would simply choose one of hundreds that are still available ten minutes north of my house, or south, or east, or west in the four adjoining municipalities, none of which are following this madnessâŚ
Idiots!
For Muddy:
That would be Surrey, Port Coquitlam, Port Moody and Burnaby
This is off-topic, sort of, but many years ago my oldest daughter and son-in-law knew of this place where we all stayed for a couple of nights that was down near 4th and Denman, that was supposedly a small condo building, and zoned as such, but was being run as a clandestine hotel. We had this nice 2 bedroom apt, with a living room with a gas fireplace, and a kitchen. I wonder what became of that place.
Iâm currently applying for a business license in Richmond. I have some of the same fears. The wording of our regulation says that there are to be no cooking facilities in the rental rooms. Iâve taken out the stove in the downstairs kitchen and replaced the big fridge with an under-counter, so hopefully it can be defended as a family room.
Our other barrier is that we are allowed a maximum of two guests, and we stretch that a bit to say âtwo adult guests plus children and petsâ.
I feel like we are well within the Provincial regulations, and we do legitimately use the space for ourselves when itâs not rented, but I feel very vulnerable to the potential whims of the city inspector.
@Spark you could on your own or with other hosts seek to amend the pending legislation.
I would also suggest an exploratory chat (call to find out if you can get a free brief consult, I think they see these issues frequently) with Enrico Schaeffer, who in the podcast I linked yesterday discusses representing hosts facing onerous local regulations.
If it were me, Iâd try to get a free initial consultation to lay out options, and fin out what sort of retainer he would want to do a quick letter or lobbying phone call to see how to tweak #4 to keep you legal.
If you could draft a letter yourself to go out under a law firmâs letterhead, even a local law firm, and enlists several more signatories, that might make this an more affordable lobbying effort. Perhaps note that you plan additional actions [political, legal] if #4 isnât redrafted to define cooking facilities as the inclusion of a ârange, oven, cooktop or hotplate,â and that refrigerators, microwaves and electric kettles are permitted.
I worked at the interface of provincial and municipal government for decades. The municipalities appear to be clearly well within their legitimate powers under the Municipal Act to enact this kind of bylaw.
Perhaps there is some kind of novel Charter argument to be made, but charter challenges cost more than we would make in two years â paid up front.
Of course, with that said, governmental bodies to respond as you note to pressure, and pressure from hosts also counts.
As they say in New York City, âYou donât ask, you donât get.â
If I were in these shoes, I would personally file (âpro seâ) an injunction against the law for whatever the provincial court filing fee is (hopefully nominal). I woud note that the hotels are interfering with my legitimate business (âtortuous interferenceâ) and a suit is forthcoming. I would list the local government and the relevant lobbying group, in this case, the British Columbian Hotel Association, as joint defendants (âjoint tortfeasorsâ).
I would ask for a sizable amount, multiples of my foreseable income, and try to get other hosts to join me as plaintiffs. I would go to provincial court, not small claims, since this allows you to put together a stronger record of facts for appeals courts to examine. (Small claims forms are deliberately simple.)
If funds permitted, I would get a legal eagle to look over my draft injunction and draft tortuous interference lawsuit.
Iâve done something similar when a fraudulent guest review threw me off Airbnb without recourse, and the legal route got me reinstated. The judges also danced up to the line on whether I could force damages, but the U.S. case law isnât there yet on one-sided contracts such as Airbnbâs. (what are called contracts of adhesion).
The amount of work involved, to me, is not bad especially given the potential for a settlement and possibly even real change by the government bodies.
Also, if you narrowly tailored your complaint to the fact that requirement #4 is excessive, given that requirements #1-#3 are sufficient to deter investors, that might give the court a notion that your are only seeking a reasonable accommodation for legitimate non-investors, and that the hotel lobbyists went too far.
That would also essentially cede the fact that the government indeed has an interest in preserving long-term housing options, just it went a bit overboard here.
