Tribunal backs Toronto's short-term rental rules

by Gerv Tacadena20 Nov 2019

The Local Planning and Appeal Tribunal (LPAT) decided to uphold Toronto's short-term rental regulations, which were first approved in the city nearly two years ago.

LPAT dismissed an appeal by several landlords who claimed that the rules limit how properties can be rented out. The rules were initially supposed to take effect in June 2018.

"When we approved these regulations in 2017, we strived to strike a balance between letting people earn some extra income through Airbnb and others, but we also wanted to ensure that this did not have the effect of withdrawing potential units from the rental market," Toronto Mayor John Tory said in a statement.

The decision means short-term rentals through platforms such as Airbnb will be allowed in all housing types across the city, but only in principal residences. Landlords will be allowed to offer short-term rentals for up to 180 nights a year for an entire house or apartment.

Additionally, homeowners can only rent up to three bedrooms annually and they will not be permitted to use basement apartments as short-term rentals.

"One fact is indisputable: each dedicated short-term rental unit displaces one permanent household. That household must find another place to live," said LPAT adjudicator Scott Tousaw in his ruling.

Short-term rental companies like Airbnb will be required to pay $5,000 to the city to be licensed. They will also be charged $1 for every night a property is booked through their platforms.

Landlords using these short-term rental platforms will also have to pay an annual fee of $50 to the city. They will also be required to pay a 4% Municipal Accommodation Tax on rentals that are less than 28 consecutive days.

In a statement, tenant advocate group Fairbnb Canada said the decision could return 5,000 housing units to the long-term housing market.

"In the midst of an acute affordable-housing crisis, returning even a fraction of these units to the market will make a huge difference in the lives of renters in Toronto," said Fairbnb coalition member Bahar Shadour.

In the tweet below, market watcher Matt Elliot identified the key points of the new short-term rental rules:

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