Airbnb restrictions up in the air as tourist season looms

New rules were supposed to come into effect on June 1, but challenges mean they are unlikely to be enforced this summer.

Toronto’s proposed restrictions on Airbnb and other short-term home rentals now appear likely to be delayed, dismaying those who want the rules in place before the city’s busy tourist season begins.

New rules passed in December by city council, including a ban on nightly rentals of self-contained basement apartments and otherwise vacant condos, were supposed to take effect June 1.

But challenges by four short-term rental hosts at what was formerly the Ontario Municipal Board, based on city rezoning required to enact Toronto’s new licensing rules, are now set to be heard Aug. 30 and 31.

Carleton Grant, director of policy and strategic support for the city’s licensing department, said what is now the provincial Local Planning Appeal Tribunal might not issue its decision for six to eight weeks after the hearing.

The city can still act on complaints against short-term rental owners that aren’t licensed as hotels, he said, but won’t actively implement the new bylaw with the spectre of a ruling that could force changes in it.

“We're in a holding pattern,” Grant said in an interview Monday. “Unless something happens quickly, June 1 (implementation) is in jeopardy.

“We're working hard in the background to have everything ready to go June 1,” knowing that, unless the landlords withdraw their separate challenges, that won’t happen, he said.

If the late August hearing proceeds, and the tribunal issues a decision, the city would likely then give all parties time -- perhaps 30 days -- before enforcing the rules.

Toronto hopes limiting such rentals to a host's "primary residence will stamp out so-called "ghost hotels," which cater to visitors who come and go -- and sometimes annoy long-term neighbours with noisy parties. Many councillors also worry that letting basement apartments and condo units become short-term rentals is depleting Toronto's affordable housing stock.

Airbnb, the San Francisco-based online rental platform, said in December that about 700 of its 10,000-plus Toronto “hosts” rented out secondary suites that would be illegal under the new bylaw. Other companies and individuals own many other units that would also become illegal.

Jeff Hodgart is among those appealing the new rules. He states in a January letter to the then-OMB that he bought 200 St. Helens Ave. in 2009 as a semi-detached multi-unit dwelling and in January 2016 converted two units to short-term rentals.

Hodgart’s lawyer, Aaron Crangle, told the Star his client feels the city is unfairly trying to put the burden of providing affordable housing onto private individuals like him.

“The city didn’t do its job building affordable housing, or take other actions, so why is it on my client to provide it?” Crangle said. The appeal notice states the city has “no planning justification to restrict the use of the property as it has been intended to be used and has been used since the renovations were undertaken.”

Thorben Wieditz, a spokesperson for the Fairbnb coalition that includes hotel owners and unions that pushed the city to crack down on short-term rentals, said he doesn’t expect to see the regulations enforced until sometime next year.

"A lot of condo owners who put up with noisy, inconsiderate people coming and going from neighbouring Airbnbs were hoping the regulations would be enforced in time for the tourist season. They wanted a calmer summer than last year, and those folks are disappointed this is not taking place," he said.

Wieditz said that, as of June 1, Airbnb should delist any units that would become illegal once the new bylaw comes into force, even if the company is not yet required to do so.

Alex Dagg, an Airbnb spokeswoman, said in a written statement that company continues to work with city officials toward a June 1 implementation date, adding: “We are proud to be cooperating with the city to find solutions, and we encourage all home-sharing platforms that operate in Toronto to stand up and do the same.”

But she would not say if Airbnb would enforce the rules on June 1 even if not required to by the city, saying: "Our host community is eager to comply with the city's rules -- not the wishes of a well-funded hotel industry front group" such as Fairbnb.

Councillor Paula Fletcher expressed dismay at a possible delay in implementation of the new bylaw, noting there is a proposal for a multi-unit building in her ward's Riverside district that neighbours fear could become the sort of short-term "ghost hotel" the new bylaw would ban.

Don Peat, spokesman for Mayor John Tory, said the mayor believes the new regulations strike the right balance between “embracing new technologies while protecting neighbourhoods and keeping the city affordable for residents looking to rent an apartment” and he “looks forward to the outcome of the OMB hearings and the enactment of these new regulations as soon as possible.”