Short Term Rentals
I have heard from residents in our community about the negative effects of short-term rentals, such as AirBnB in our neighbourhood. While these services do have a place in our City, these rentals were operating in a largely unregulated, unaccountable market. As a result of this, we have seen local issues such as ghost hotels, excessive noise and safety concerns, as well as other City-wide issues being made worse, such as a reduction in long-term rental stock for people who wish to live and work in Toronto.
In 2018, I recognized this as an issue and worked to create an environment where our neighbourhoods are protected, while still giving homeowners the flexibility to leverage their property. While the bylaws were passed by Toronto City Council and meant to come into effect that year, short-term rental operators challenged the bylaw, by taking the City to the Local Planning Appeals Tribunal, which kept the bylaws from coming into effect. Last December, a decision was made in favour of the City and we are now proceeding with the implementation of these bylaws.
Under the new bylaw:
- Short-term rentals are permitted across the city in all housing types in residential and the residential component of mixed-use zones.
- People can host short-term rentals in their principal residence only – both homeowners and tenants can participate.
- People can rent up to three bedrooms or an entire residence.
- People who live in secondary suites can also participate, as long as the secondary suite is their principal residence.
- An entire home can be rented as a short-term rental if the owner/tenant is away – to a maximum of 180 nights per year.
- People who rent their homes short term must register with the City and pay $50.
- Companies such as Airbnb must pay a one-time licence application fee of $5,000 plus $1 for each night booked through the company.
- People doing short-term rentals must pay a 4 per cent Municipal Accommodation Tax (MAT) on all rentals that are less than 28 consecutive days.
- Companies such as Airbnb can enter into voluntary agreements to collect the MAT on behalf of those associated with their company.
Enforcement of the new bylaws will be conducted by Municipal Licensing & Standards on the below timeline:
Phase 1: Complaint-based investigation – ongoing
As the licensing and registration system is being put in place, the City continues to respond to issues on a complaint basis. Residents can contact 311 to report issues related to short-term rentals, such as noise, waste and zoning infractions and the City will investigate accordingly.
Phase 2: Licensing and registration – Spring 2020
Licensing of short-term rental companies and registration of operators will begin in spring 2020. Current and prospective short-term rental operators will have three months to register. During this time, the City will educate the public on short-term rental rules, encourage operators to register their short-term rentals, and work with companies to ensure compliance with the licensing rules.
Phase 3: Enforcement and MAT– Summer 2020
All current short-term rental operators will need to be registered by the end of phase 2. The City will take enforcement actions against short-term rental operators that are not registered or are not following the rules. As of the end of phase 2, registered short-term rental operators will also be required to start paying the four per cent Municipal Accommodation Tax (MAT) on a quarterly basis.
Enforcement action will also be taken against companies that allow unregistered operators to list on their platform or contravene the bylaw.
New short-term rental operators can register on an ongoing basis.
More information will be made available on the City's short-term rentals website.