The COVID-19 pandemic is pushing Toronto condo owners to list fewer properties as short-term rentals using services like Airbnb.
What’s more, experts believe this trend might outlast the coronavirus crisis, as stricter city regulations have property owners preferring to rent them for longer terms.
In two downtown complexes near the waterfront, the ICE Condominiums on York Street and Maple Leaf Square next door on Bremner Boulevard, about 125 units were listed for long-term rent as of this week, according to Zhen Liang, the broker of record and president at RE/MAX Excel Advantage Reality.
“That is a tremendous amount of listings because that’s almost five per cent of the entire building that just became available on the market,” he said.
“For as long as I’ve operated, I’ve never seen this much inventory for long-term in [these buildings] specifically.”
Liang attributes about 80 of those listings to be due to COVID-19, with recently upheld city by-laws that restrict short-term rentals to the owner’s principal residence also contributing to the “huge surge” in recent months.
Ana Archer Amoroso, the founder of the Airbnb property management company AirPro Hosts, recently listed a unit in ICE Condominium as a long-term rental on behalf of its owner. Up until recently, it was only available short-term.
Archer Amoroso said she saw a steep dive in reservations following the announcement last month that Airbnb would allow full refunds for certain reservations in response to COVID-19. She said after the condo board temporarily banned short-term rentals in response to the pandemic, she and her client had no choice but to act.
“That’s exactly when we started seeing that we needed to adjust temporarily to see if we could survive this situation,” she said.
More housing supply
The COVID-19 crisis could put up to 7,500 homes back on the long-term market as owners seek to minimize losses, according to advocacy group Fairbnb Canada, a coalition of homeowners, tenants, tourism businesses and labour organizations.
“The last few years, Airbnb has removed thousands of housing units from markets around the world,” said Thorben Wieditz, the group’s director.
“COVID seems to be doing what regulators and advocates have tried to for many years.”
The current market-driven challenges follow a decision by the Local Planning Appeal Tribunal in November to uphold rules passed by the City of Toronto to limit short-term rentals to the owner’s primary residence and to ban short-term rentals of secondary properties. Similar rules already existed in other cities including Mississauga, Oakville, Ont., and Vancouver.
Wieditz said going forward, it will be more difficult for owners to enter or re-enter the short-term market.
“We should see more legal properties being advertised on Airbnb,” he said. “When people go back and flip units onto the short-term rental market they actually need to show that they’re the principal resident.”
The pandemic could have lasting changes on consumer preferences when it comes to cleanliness, according to Chris Gibbs, chair of Creative Industries at Ryerson University.
Gibbs said this could drive people back to the familiarity and consistency of hotels over short-term rentals.
“Do I know they’ve cleaned their sheets? Do I know they’ve wiped down their services? Do I know they have the same cleaning standards?” he asked, channelling a customer.
Present and future
Earlier this week, Airbnb said it would pay $250 million to hosts around the world to offset losses due to cancellations linked to COVID-19.
In a statement posted on its website, the company said claims that hosts are delisting in favour of other platforms or the long-term market are inaccurate. It said there are more listings on Airbnb now than at the same time last year. The company stated that in the top 20 Canadian and U.S. cities, 80 per cent experienced a net change of fewer than 200 units over the past 30 days.
For Archer Amoroso and her client’s unit in ICE Condominium, she said they hope to eventually resume renting short-term while following city regulations. For now, they will rent long-term — for periods of 28 days or more — via the Airbnb platform.
“We’re really going day by day at the moment and trying to adjust as it comes,” she said.View link »