The unprecedented surge in housing prices have led to calls for the city to step in with solutions to remedy the growing unaffordability of housing. One way city council hopes to ease the pressure on the housing market is by curbing sharing economy apps like Airbnb.
Members of the public who can’t make the next round of in-person public consultations can have their say by filling out an online survey on the City of Toronto website.
Ward 18 Councillor Ana Bailão, a staunch proponent for affordable accommodation, says regulations could prevent landlords from continuing to use vacant properties as short-term rentals – a practice found to keep entire homes off the market.
“If you’re going away for a month somewhere and you want to [leave] your property with somebody or rent it out for that month, that could be of some benefit to you,” she says. “I have issue when people are buying property or are taking out properties that used to be rentals and turning them into full-time Airbnb [units].”
Thorben Wieditz, one of the organizers behind Fairbnb.ca – a coalition of housing advocates – says that until regulations are put in place, the unbridled short-term market continues to be lucrative for homeowners and landlords, contributing to plummeting vacancy rates.
“Our research has shown that property owners can generate more revenue by putting their place onto the short term rental market than they would otherwise if they would put it on the traditional rental market,” he says. “And there’s an incentive for property owners to do exactly that. They can draw in tourists because they can offer their place cheaper, but at a daily rate that is higher than on the traditional rental market.”
Wieditz says that regulating apps like Airbnb, with nearly 85 per cent of all of the market’s short-term rentals listed on its site, can play a key role in subduing the housing market.
If only half of the 7,000 homes currently sitting as ‘ghost hotels’ were returned to the market, Wieditz explains, this would “bring the vacancy rate up by one percentage point without even having to talk to developers about supply.”
Council voted unanimously in October to bring forward proposed regulations after a host of public consultations this spring.
Toronto is just one city in a spate of places across Canada and the U.S. moving towards enforcing regulations on the popular home share app. In San Francisco, hosts can only list their property for 60 days per year. While New York has enacted a number of laws around Airbnb, including making it illegal to rent entire homes and apartments and applying fines ranging between $1,000 to $7,500.
The second public meeting will be held at City Hall on April 12.
“Airbnb has a role to play, we just need to make sure it’s the intended role,” says Bailão. “People that travel and people that like to be hosts could benefit from a platform like Airbnb. I also think there’s a place for legislation.”
Author: Shantal Otchere