Provincial measures for Short term rentals

A recent article released by the Province speaks to a number of measures the Province will be implementing to assist municipalities in addressing short term rentals.

These measures include:

Increasing Fines and Tools for Local Governments:

• Raise fines for operators who breach local rules.
• Mandate short-term rental platforms to share data with the Province who will in turn share that information with municipalities to aid with enforcement
• Require online short-term rental listings to display business license numbers.
• Empower regional districts to issue business licenses for rural areas.

Transitioning Short-term Rentals to Long-term Homes:

• Limit short-term rentals in municipalities with populations over 10,000 to the host's primary residence (with an exception for one secondary suite or laneway home on the property).
• Define regions and municipalities exempt from the primary residence requirement.
• Abolish legal protections that investors use to bypass local regulations on short-term rentals.

Establishing Provincial Rules and Enforcement:

• Initiate a provincial host and platform registry.
• Launch a provincial short-term rental compliance and enforcement unit.

Exemptions and Clarifications:

• Small communities and tourist-heavy areas can choose to adopt the primary residence requirements based on local housing pressures.
• Communities on First Nations reserve land and Modern Treaty Nations are exempt but can opt into the legislation.
• The legislation doesn't apply to hotels, motels, timeshares, and fishing lodges.

Timeline

• Phased approach over two years.
• Immediate changes include increased fines and new business licensing authority.
• Principal residence requirement and changes to legal protections start May 1, 2024.
• Data sharing begins Summer 2024.
• Provincial registry launches in Late 2024.
  
  

In addition to the Provincial measures, beginning on January 1, 2024, the Federal Government intends to:

• Deny income tax deductions for expenses incurred to earn Short term rental income, including interest expenses, in provinces and municipalities that have prohibited Short term rentals.
• Deny income tax deductions when Short term rental operators are not compliant with the applicable provincial or municipal licensing, permitting, or registration requirements.
• Support municipalities that are cracking down on non-compliant short-term rentals. The 2023 Fall Economic Statement proposes $50 million over three years, starting in 2024-25, to support municipal enforcement of restrictions on Short term rentals. This will support municipalities with strict regulatory regimes that are having a significant and measurable impact in returning Short term rentals back to the long-term housing market.