TORONTO, Sept. 16, 2024 /CNW/ – McGill University Professor Dr. David Wachsmuth has published a new province-wide report, Short-term Rentals and Housing Affordability in Ontario. The report quantifies the impact of commercial short-term rentals (STRs) on housing affordability and rental prices across Ontario. It emphasizes the critical role that STR regulations – including principal residence restrictions – have played in stabilizing rental costs within the province.

“This report is groundbreaking because it’s the first study in Canada to demonstrate a causal link between commercial STR operations and rent increases across municipalities,” said Thorben Wieditz, Executive Director of Fairbnb Canada Network. “It is based on peer-reviewed academic research, providing undeniable evidence that commercial STRs have driven up rents.”

The report reveals that the growth of short-term rentals—especially commercial operations—has led to significant rent increases, costing Ontarians $1.6 billion in additional rent since 2017.

One key driver of this rent inflation is that landlords can charge significantly higher rates to tourists than long-term tenants. In July 2023, commercial hosts earned an average of $6,700 per listing, nearly five times the average monthly rent of $1,408 in Ontario. A staggering 41% of Airbnb listings in Ontario are operated by commercial hosts who convert residential properties into “ghost hotels,” with the top 10% of commercial hosts generating 44% of total STR revenue in the province.

“Housing planned, approved, and built to accommodate Ontario residents should not be repurposed as ghost hotels,” Wieditz emphasized. “The province establishes housing targets, and it has a responsibility to prevent these housing-to-hotel conversions, which reduce housing supply and contribute to rising rents.”

Key Findings:

• STR regulations are proving effective: Current STR regulations across Ontario already save tenant households more than $1 billion annually.
• Principal residence restrictions work: Municipalities with principal residence restrictions experienced rent increases that were 3.3% lower, saving tenants an average of $50 per month.
• Province-wide potential savings: Expanding principal residence requirements across Ontario could save renters an additional $572 million annually.

“These findings offer compelling evidence that STR regulations, including principal residence restrictions, successfully reduce rental costs in various municipalities across Ontario,” added Laura Murphy, Senior Housing Policy Advisor at the Advocacy Centre for Tenants Ontario.

Fairbnb Canada Network and its coalition of housing advocates are urging the provincial government to implement province-wide principal residence restrictions to protect renters further and ensure housing remains affordable for all Ontarians.

About Fairbnb Canada Network
Fairbnb is a Canadian non-profit organization advocating for equitable short-term rental regulations across the country. Comprising voices from tenant organizations, the regulated hotel and B&B industry, property owners, academics, and concerned citizens, Fairbnb’s mission is to protect housing security. Originally founded as an informal coalition, Fairbnb emerged in response to the 845% growth in Airbnb listings in Canada since 2012. They call for a robust, nationally consistent policy framework that balances fair, safe, and respectful short-term rental legislation without seeking to ban genuine “home-sharing.” Fairbnb supports short-term rental hosts who legally rent spare rooms or spaces in their principal residences, emphasizing compliance with all applicable laws and regulations. Learn more at www.fairbnb.ca.

Statistics Canada’s report last week, “Short-term Rentals in the Canadian Housing Market,” reveals that by 2023, 107,266 housing units had been converted to commercial short-term rental (STR), rendering them unavailable for long-term occupancy. Comparing this number to Canada’s current total housing stock of 15,495,361 units, Statscan suggests that a seemingly minor 0.69 per cent of the total housing stock is utilized as commercial STRs.

Airbnb Inc.’s Canadian policy lead, Nathan Rotman, quickly seized on this statistic, arguing that Airbnb’s impact on the housing market is minimal and that further restrictions on STRs wouldn’t solve the housing crisis. However, this interpretation is fundamentally flawed.

To accurately assess the impact of commercial STRs, it’s essential to focus on their proportion of available housing units rather than the total housing stock.

According to the Canada Mortgage and Housing Corporation (CMHC), Canada’s vacancy rate for purpose-built rentals is 1.5 per cent. Assuming this rate is similar across other housing types, there are approximately 232,430 available units nationwide for long-term residents. The 107,266 units now used as commercial STRs could increase the pool of available units by another 46 per cent.

In other words, if all these units were returned to the market, Canada’s vacancy rate would rise significantly, highlighting the urgent need to address this issue again.

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The number of short-term rentals in Canada has grown sharply since 2017, with units that could be considered usable for long-term housing growing even faster, a new Statistics Canada report said on Tuesday.

According to the report, the total number of short-term rental units in Canada grew by 60 per cent between 2017 and 2023. The number of units considered ‘potential long-term dwellings’ (PLTDs) – or units that could be long-term housing – rose by 80 per cent.

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Nearly half of the 22,405 short-term rental listings reviewed by the B.C. Ministry of Housing were found to be operating illegally, according to a preliminary analysis of newly released data from short-term rental platforms that the province says it will use to step up enforcement of new restrictions.

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Barcelona plans to enact a citywide ban on all short-term rentals to address complaints that tourism is to blame for a local housing crisis and soaring rents.

The Mediterranean city will stop giving new licenses and won’t renew existing ones so that in 2029 no homes will have permission to be rented as tourist accommodation, Barcelona Mayor said at a press conference on Friday. There are now about 10,000 houses registered as rentals for tourists.

“More supply of housing is needed, and the measures we’re presenting today are to provide more supply so that the working middle class does not have to leave the city because they can’t afford housing,” Collboni said. “This measure will not change the situation from one day to the next. These problems take time. But with this measure we are marking a turning point.”

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The building is splattered with different shades of paint. Its doors and windows are covered with posters. The message is as clear as the graffiti sprayed across its walls: the crowd who gathered around the building on Wednesday doesn’t want Airbnbs in their neighbourhood and to them, it is a brick-and-glass symbol of the housing crisis.

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Reports about how Airbnb has turned housing units planned, approved, and built as residential into quasi-hotel inventory—so-called ghost hotels—have been abundant across Canada. Every tenant knows that finding a decent place to live is not only extremely difficult, but that once attained, it is also horrendously expensive. Seeing large platforms systematically enabling the conversion of our housing stock into their permanent tourist inventory has been infuriating, and seeing governments struggle to hold these footloose companies to account has been discouraging. We know platforms have been resourceful in finding or creating regulatory loopholes to exploit, ensuring that their online inventory increases—always at the expense of long-term residents, neighbours, and communities.