February 26, 2019 9:00 pm
Updated: February 26, 2019 9:55 pm

Kelowna cracking down on short-term rentals

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The City of Kelowna has revealed new rules for short-term rentals that could affect hundreds of hosts throughout the city.

“We’ve seen long-term rentals vacated and used instead for short-term rentals, which means that people who want to live here year-round or for long periods of time can’t find places to live,” Mayor Colin Basran said.

“There are also bylaw issues in terms of noise and parking, where properties are being used often for Airbnb, and they’re disrupting the neighbourhoods in which they are located.”

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READ MORE: Kelowna moves to limit short-term rentals to principal homes, ban vacation rentals in secondary suites

Under the city’s recommendations, property owners would be allowed to rent out a room in their principal residence as long as they live in that home at least eight months of the year.

But short-term rentals wouldn’t be permitted in investment properties, secondary suites or carriage houses.

“When those were approved, particularly with basement suites, it was with long-term rentals and tenancies in mind, not for people to be running small businesses out of their homes,” Basran said.

READ MORE: Kelowna mayor: Short-term rentals affecting housing market

However, there would be some exceptions.

“We got a lot of feedback in the area around the hospital that they are utilizing rooms or basement suites or carriage houses for people who are looking for short-term stays because they have a loved one in the hospital,” Basran said.

“They want to be nearby, and we think that’s certainly a legitimate reason to allow short-term rentals in the hospital area that are a bit different than other neighbourhoods.”

Developments that have already been approved for short-term rentals will be grandfathered in, he added.

“There are projects that have been approved, are under construction or are fully built now, that under our old zoning were allowed to do short-term rentals, and they will be allowed to keep that zoning,” Basran said.

Airbnb’s reaction

Alexandra Dagg, public policy director for Airbnb, said the proposed bylaw is too restrictive.

The typical host in Kelowna only rents out their place for 43 nights a year, she said.

“This is not a commercial activity. This is not a professional activity. This is people sharing a space in their home or their vacation home when they’re not using it,” Dagg said. “And so rules need to be simple. They need to be affordable and easy to follow.”

READ MORE: Kelowna landlords find loophole around short term rentals

Dagg is concerned that people will only be able to share a space in their primary home.

“If you’ve got a vacation property in Kelowna, they’re saying you can’t home-share, which just means the property will stay empty,” Dagg said. “That doesn’t help anybody in Kelowna and really hurts the tourism business.”

Dagg thinks it would make more sense for the city to allow people to share one property.

“Whether it be a secondary home, a primary residence including a basement flat or nanny suite — allow people to do that. It’s really important for the tourism business and economy,” she said.

READ MORE: City of Kelowna wants public input on short-term rentals

Dagg would like to see an online system where people who are sharing their home could register and pay an affordable fee.

“That way, the city knows who is doing it, and they could track and monitor how many people are sharing space in their home,” Dagg said.

“Those kinds of simple registration systems have worked well in other communities because it gives Kelowna the info they need to be able to take a look if there are any complaints,” she added.

Dagg said 1,300 Airbnb hosts are listed in Kelowna. They typically make less than $10,000 a year, she added.

Bylaw enforcement

Under the proposed bylaw, those who want to operate a short-term rental will need a business licence.

Although the final cost of a short-term rental licence hasn’t been set, initial consultations have pegged it around $350.

Vancouver charges about $50 for its short-term rental licence.

“It’s seven times more expensive in Kelowna,” Dagg said.

“What we’ve seen is if cities set it at an affordable amount, they get a lot more compliance. People will come forward, they’ll register,” Dagg said.

The cost of licensing and enforcing short-term rentals is estimated at $320,000 a year, according to a city report.

City staff is suggesting another bylaw officer and another chief administrative clerk.

Basran said he wants hosts to help cover the cost of another bylaw officer, not taxpayers who aren’t making money that way.

Although bylaw infractions are typically monitored on a complaint-driven basis, the city will be on the lookout for anybody breaking the rules around short-term rentals, Basran said.

“Given the housing crunch that we have, we’re going to be a little bit more proactive in terms of our enforcement of the new rules,” he said.

As the height of the tourism season creeps closer, the mayor has a warning for those booking ahead.

“If your short-term rental is in contravention of the new guidelines, I would say probably don’t take any more reservations because, ultimately, once these new rules are approved, you could potentially be breaking our bylaws,” Basran said.

The public will have a chance to give input at a hearing on March 12.

Council will then either move forward or tweak the bylaws, but the hope is to have the new rules in place within the next couple of months, Basran said.

“I think we’ve struck a good balance between increasing the number of long-term rentals for people who want to live here year-round, as well as creating opportunities for people who want to visit our city,” Basran said.

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