Toronto City Council approves Airbnb, short-term rental regulations

Users will have to register with the city, and pay a fee of $50

Airbnb sign on wall

Residents of Toronto will now be able to formally list their homes on short-term rental platforms like Airbnb.

After a lengthy series of discussions and debates, and an inordinate amount of motions and amendments introduced on the day of the vote, Toronto City Council successfully managed to vote on and approve the implementation of a series of restrictions governing the use of short-term rentals.

To begin with, only primary residents of a principal residence — excluding secondary suites — can list their homes on Airbnb. They will need to first register their dwellings on an online City database, as well as pay an annual fee of $50 CAD.

Homeowners will only be able to list their dwelling for 28 consecutive days or fewer, and will only be able to list their dwelling for a total of 180 days per year.

Short-term rental operators, like Airbnb will also need to register with the City, pay a one-time fee of $5,000 CAD, as well as a fee of $1 per night booked through their platforms.

Regulations will come into effect on June 1st, 2018, and the City has until then to create the registration database.

“These regulations do the right thing in the right way,” said Toronto Mayor John Tory. “They strike a balance that embraces new technology and allows short-term rentals while protecting communities.”

A response from Airbnb and its critics

While council had since November 2017 to review the two pieces of legislation they voted on, councillors from across all of Toronto’s 44 wards were unable to really reach a consensus until well into the evening.

Aside from some councillors expressing fundamental disagreement about the need to legislate short-term rental listings at all, the central issue that delayed the vote was a motion by Ward 18 Councillor Ana Bailao to allow individuals living in secondary suites to list their homes on Airbnb and other similar platforms.

Bailao’s motion was largely unpopular, because other councillors felt that it was inappropriate for landlords and homeowners to spend time living with people who were not vetted or otherwise approved.

According to Airbnb public policy manager Alexandra Dagg, while the company agreed — and worked with city staff to provide input on most of the provisions outlined in the two Council documents — the provision that excluded secondary suites was one that the company did not support.

“I think those are a fair set of rules…”

“These are people’s homes and for the city to say you cannot homeshare in a basement apartment that you may have spent money on to build, we just think is really going too far and is going to have potentially harmful impact on families in Toronto who are struggling to make ends meet,” said Dagg, in a phone interview with MobileSyrup.

Councillor Bailao’s chief argument was that approximately 70,000 Toronto families live in a secondary suite, and it is therefore unfair to prevent them from listing their homes as a short-term rental.

Bailao said that it’s important for the City to stay true to two principles: maintaining housing affordability and availability, and allowing “a tenant or owner to participate in short-term rentals if it is their primary residence.”

Ultimately, Council moved to reject Bailao’s motion, preventing individuals who live in secondary suites — like basement apartments — from listing their space for short-term rental.

“We have nothing against the typical host…”

Dagg also expressed concern with the 180-day cap imposed on Airbnb users.

“People tend to use homesharing for different reasons and there’s a huge range of use on our platform from anything from the odd weekend to two-week vacations,” said Dagg. “Or we have a lot of artists, creative people, who juggle multiple jobs to kind of make ends meet, and there could be a period of time when they’re out of the city for a longer period of time than they typically are.”

“…what we do have a problem with is with absentee landlords and people that buy properties or lease properties…and in the most extreme cases use them [as] commercial assets.”

People like Thorben Wieditz, a member of the Fairbnb coalition that aims to promote regulation and responsible short-term listing, viewed Council’s legislation as a positive step forward.

“I think those are a fair set of rules that allow people to share their own home while they’re away…but it addresses some of the issues of the commercialization of homesharing that we have seen in Toronto and other major cities, where businesses pop up and basically turn the residential neighbourhood and residential condo towers into what we call ghost hotels,” said Wieditz, in a phone interview with MobileSyrup.

Wieditz went on to say that the new rules not only address that critical concern, but also “enables people to engage in homesharing and use platforms like Airbnb.”

“We have nothing against the typical host that rents out their place on occasion, but what we do have a problem with is with absentee landlords and people that buy properties or lease properties…and in the most extreme cases use them [as] commercial assets,” said Wieditz. “That has nothing to do with homesharing. Those hosts are not sharing their place, they buy or rent a place and then they put it on platforms to use them as vacation properties.”

What’s next for Airbnb users

While the City works on building the resources necessary for users to register and pay their short-term rental fees, Airbnb will no doubt need to inform its users about the incoming changes.

However, Dagg said that Airbnb wasn’t in a position to speculate.

As for Wieditz and the other members of Fairbnb, Council’s successful meeting is only the first step.

“We have a number of months to monitor to see what’s happening and then we also have to see how Airbnb will react to it,” said Wieditz. “If Airbnb will play along with the government rules or not and we have seen from a great many other jurisdictions that Airbnb’s happy to ignore these rules — just download the responsibility to individuals and basically say, ‘you know what, we are just an internet-based platform, we can’t be held responsible for the content that is posted on our website, and we always inform our clients, our hosts, to obey the law.'”