The British Columbia government has implemented new legislation to restrict those offering short-term accommodation to live on the property they're renting. This will force short-term rental platforms to share their data with the province for enforcement and tax purposes, and would limit short-term rentals to within a host’s own home, or a basement suite or laneway home on their property. Although most of the rules will apply to communities that have a population of 10,000 or more, anyone operating a short-term rental will be required to register on the newly created provincial host and platform registry that's now in effect. Read on below for more detailed information regarding the new legislation:
The new legislation contains the following provisions:
• Like municipalities, Regional Districts will be given the power to set the maximum penalty of $50,000 for severe contraventions of by-laws.
• It will also be mandatory for platforms to share information with the province, including information about short-term rental hosts. The province will have the ability to share this data with municipalities to coordinate regulation.
• Short-term rental platforms will be required to include businesses license and registration numbers on listings when they are required by a municipality.
• Regional Districts will be granted business regulation and licensing powers parallel to those of municipalities. This means Regional Districts will be able to require businesses, including short-term rental businesses, to obtain and maintain a business license to operate.
• Essentially, this means existing short-term rentals cannot be “grandfathered”.
• Once established operators will have 3 months to register their companies and 6 months to register their units.
• A provincial enforcement unit will be established to issue orders and administer penalties.
• The provincial government will be enforcing the Short-Term Rental Accommodations Act while municipalities will continue to be in charge of enforcing their own bylaws.
exempt:
• Hotels and Motels
• Timeshares
• Lodges (accommodation provided by an operator of outdoor recreational activities such
as hunting, fishing, etc.)
• Designated Resort Municipalities (these municipalities may choose to opt-in to principal
residence rule):
• Agri-Tourism Accommodations
• First Nations’ Land
• Strata hotels or motels only if the owner cannot use the property as a principal residence due to mandatory provisions in a rental pool or rental management agreement.
• Properties where owners hold fractional ownership only if the owner cannot use the property as a principal residence due to mandatory provisions in a fractional ownership agreement.
• Licensed Bed and Breakfasts only if it has a resident owner operator (property is owner’s principal residence) or it operates as a hotel.
• Home Exchanges
• Living accommodations primarily for students, educational staff or faculty, owned or operated by an educational institution or non-profit organization.
• Strata corporation guest suites intended for strata resident visitors.
• Properties with assessed Class 9 farmland.
requirements provided they give appropriate written notice by March 31 of each year for
the rules to take effect on November 1 of the same year.
• Municipalities that are subject to the principal residence rule can opt-out of the rule if:
The timelines for these provincial initiatives are as follows:
• Effective Immediately: Increased fines and tickets, business licensing authority for regional districts
• May 1, 2024: Principal residence requirement (including definition of exempt areas or accommodations), changes to legal non-conforming use protections.
• Summer 2024: Data sharing
• Late 2024: Provincial registry launch, requiring platforms to remove listings without valid provincial registry number.
• Deny income tax deductions for expenses incurred to earn short-term rental income in provinces or municipalities that have prohibited short term rentals or for operators who are non-compliant with local licensing or permitting.
• This means short-term rental hosts in these areas will not be able to claim expenses against any of the income they make from their short-term rentals.
• This measure will come int effect January 1, 2024.
Short Term Rentals
a.) Provincial
The provincial Short Term Rentals Accommodations Act was introduced with the intent of bringing more houses into long term rental stock. All of the requirements in this act will apply regardless of local zoning bylaws.The new legislation contains the following provisions:
General Provisions
• The provincial legislation applies to rentals with durations of 90 days or less. Municipalities will still be able to define a different time period (e.g. 30 days) for municipal bylaws. This would apply to municipal bylaws only. The provincial legislation would still apply at 90 days or under. • While some municipalities may allow short-term rentals in specific zones, the provincial residence requirement is not zone specific. This means the provincial principal residence requirement will apply regardless of if a municipality has zoned a specific area for short-term rentals use.
• Provincial requirements will apply (and essentially override) municipal short-term rental rules if they do not abide by the provincial requirements which are a “floor”. Municipalities can make bylaws that are more restrictive than the rules outlined by the province but not less restrictive.
• This regulation is a “floor”, municipalities may make stricter requirements but must abide by this rule as a minimum.
• In the interior of the province the communities included under this principal residence
rule will be:
• Provincial requirements will apply (and essentially override) municipal short-term rental rules if they do not abide by the provincial requirements which are a “floor”. Municipalities can make bylaws that are more restrictive than the rules outlined by the province but not less restrictive.
Principal Residences Only
• As of May 1, 2024, all short-term rentals in communities with populations 10,000 or over will be limited to principal residence and /or a secondary suite only.• This regulation is a “floor”, municipalities may make stricter requirements but must abide by this rule as a minimum.
• In the interior of the province the communities included under this principal residence
rule will be:
- Kelowna
- Kamloops
- Vernon
- Penticton
- West Kelowna
- Fort St. John
- Cranbrook
- Salmon Arm
- Lake Country
- Dawson Creek
- Summerland
- Coldstream
- Nelson
- Pouce Coupe (adj.)
Fine Increases
• Fines for short-term rentals owner/operators breaking local municipal by-law rules will increase to $3000 per infraction, per day.• Like municipalities, Regional Districts will be given the power to set the maximum penalty of $50,000 for severe contraventions of by-laws.
Data Sharing and Enforcement
• Short-term rental platforms will be required to share data with municipalities to improve local enforcement.• It will also be mandatory for platforms to share information with the province, including information about short-term rental hosts. The province will have the ability to share this data with municipalities to coordinate regulation.
• Short-term rental platforms will be required to include businesses license and registration numbers on listings when they are required by a municipality.
• Regional Districts will be granted business regulation and licensing powers parallel to those of municipalities. This means Regional Districts will be able to require businesses, including short-term rental businesses, to obtain and maintain a business license to operate.
Non-Conforming Exemptions
• The current exemption for short-term rentals operating in all municipalities that restrict their use because they were operating prior to the by-law, often referred to as a non-confirming exemption, will be removed.• Essentially, this means existing short-term rentals cannot be “grandfathered”.
Provincial Registry and Enforcement Unit
• The province will create a short-term rental registry. Operators will be required to include a valid provincial registration number on their listings.• Once established operators will have 3 months to register their companies and 6 months to register their units.
• A provincial enforcement unit will be established to issue orders and administer penalties.
• The provincial government will be enforcing the Short-Term Rental Accommodations Act while municipalities will continue to be in charge of enforcing their own bylaws.
Exemptions
Some exemptions from the principal residence rule will apply. The following property types areexempt:
• Hotels and Motels
• Timeshares
• Lodges (accommodation provided by an operator of outdoor recreational activities such
as hunting, fishing, etc.)
• Designated Resort Municipalities (these municipalities may choose to opt-in to principal
residence rule):
- Fernie
- Golden
- Invermere
- Kimberley
- Osoyoos
- Radium Hot Springs
- Revelstoke
- Sun Peaks
(these areas will have no ability to opt-in to the principal residence rule, this is true even if the electoral area or municipality where it is located has opted-in to the principal residence rule):
- Apex Mountain Resort
- Bear Mountain
- Big White Mountain Resort
- Clearwater Ski Hill
- Crystal Mountain Resort
- Fairmont Hot Springs Ski Hill
- Fernie Alpine Resort
- Harper Mountain
- Hudson Bay Mountain Resort
- Kicking Horse Mountain Resort
- Kimberley Alpine Mountain Resort
- Manning Park
- Mount Baldy Ski Area
- Panorama Mountain Village
- Phoenix Mountain Ski Resort
- Red Mountain Resort
- Revelstoke Mountain Resort
- Saddle Mountain Resort
- Salmo Ski Hill
- Silver Star Mountain Resort
- Summit Lake Ski Area
- Sun Peaks Resort
- Wapiti Ski Club
- White Water Ski Resort
• Regional District Electoral Areas
• Islands Trust• Agri-Tourism Accommodations
• First Nations’ Land
• Strata hotels or motels only if the owner cannot use the property as a principal residence due to mandatory provisions in a rental pool or rental management agreement.
• Properties where owners hold fractional ownership only if the owner cannot use the property as a principal residence due to mandatory provisions in a fractional ownership agreement.
• Licensed Bed and Breakfasts only if it has a resident owner operator (property is owner’s principal residence) or it operates as a hotel.
• Home Exchanges
• Living accommodations primarily for students, educational staff or faculty, owned or operated by an educational institution or non-profit organization.
• Strata corporation guest suites intended for strata resident visitors.
• Properties with assessed Class 9 farmland.
Opt-Out/In Provision and Formula
• Municipalities and Regional Districts can request to opt-in to the principal residence rulerequirements provided they give appropriate written notice by March 31 of each year for
the rules to take effect on November 1 of the same year.
• Municipalities that are subject to the principal residence rule can opt-out of the rule if:
- They meet the requirement of a 3 percent vacancy rate over 2 consecutive years.
- They give appropriate written notice by February 29, 2024, for the opt-out to take effect on May 1 of the same year.
Timelines
The timelines for these provincial initiatives are as follows:
• Effective Immediately: Increased fines and tickets, business licensing authority for regional districts
• May 1, 2024: Principal residence requirement (including definition of exempt areas or accommodations), changes to legal non-conforming use protections.
• Summer 2024: Data sharing
• Late 2024: Provincial registry launch, requiring platforms to remove listings without valid provincial registry number.
Links and Resources
Government Press Release on Legislation - Legislation introduced to rein in short-term rentals, deliver more homes for people | BC Gov NewsGovernment Press Release on Regulations - https://news.gov.bc.ca/releases/2023HOUS0171-001945
The full legislation can be found here:
https://www.bclaws.gov.bc.ca/civix/document/id/bills/billscurrent/4th42nd:gov35-1
The Short-Term Rental Regulations can be found here - OIC-679: Order in Council 679/2023(gov.bc.ca)
In the 2023 fall economic statement the federal government announced it was looking to make owning a short-term rental less lucrative in order to bring more homes back into the long-term rental market. The federal government plans to:
https://www.bclaws.gov.bc.ca/civix/document/id/bills/billscurrent/4th42nd:gov35-1
The Short-Term Rental Regulations can be found here - OIC-679: Order in Council 679/2023(gov.bc.ca)
b.) Federal
In the 2023 fall economic statement the federal government announced it was looking to make owning a short-term rental less lucrative in order to bring more homes back into the long-term rental market. The federal government plans to:
• Deny income tax deductions for expenses incurred to earn short-term rental income in provinces or municipalities that have prohibited short term rentals or for operators who are non-compliant with local licensing or permitting.
• This means short-term rental hosts in these areas will not be able to claim expenses against any of the income they make from their short-term rentals.
• This measure will come int effect January 1, 2024.
Links and Resources
Fall Economic Statement 2023 - https://www.budget.canada.ca/fes-eea/2023/home-accueil-en.htmlCredit: