In an effort to curb British Columbia’s housing affordability crisis, the provincial government has introduced higher fines for strata short-term rentals. And, according to one realtor the fines could help renters grappling with the City of Vancouver’s severely-low vacancy rate.
Last week, the BC government announced that, as of November 30th, strata corporations can impose a fine of up to $1,000 a day to owners and residents who don’t comply with a strata bylaw that limits or bans short-term rentals.
According to a press release, the BC government decided to increase the allowable fine as the previous penalty of $200 a week was not a “sufficient deterrent.”
Vancouver-based realtor Steve Saretsky says this could be welcome news for Vancouver renters who are struggling to find housing in a market with a vacancy rate of less than one per cent.
“[I] think at a time when our market’s really starting to slow down here, this is just another thing that’s probably going to free up some more rental supply and maybe take away a little bit more of the investor demand,” Saretsky tells Livabl.
Strata housing often refers to multi-unit developments, but can also include duplexes, townhouses and single-family homes which belong to a strata corporation. Stratas are self-governed and made up of all the strata owners.
The fine hike comes shortly after the City of Vancouver partnered with global home-sharing website, Airbnb, in April to allow Vancouverites to use their primary residences as short-term rentals, as long as they obtain a business licence.
Although the immediate impact of higher fines for strata short-term rentals is unknown, Saretsky says the new rules could cause demand in the City of Vancouver’s condo market to drop further.
“I don’t think it’s going to have a significant impact, but I think you’re adding on another demand-side policy at a time when the condo market is already really slowing down. I think any sort of little changes here and there are all going to add up,” says Saretsky.
In June, the city’s condo sales plummeted to a five-year low with a total of 475 units, according to the Real Estate Board of Greater Vancouver (REBGV).
As for rental prices, Saretsky notes that the new policy could also help keep prices stable in the coming months.
“Recent data and discussion with property managers suggest that rents have sort of topped out here over the last couple of months, so maybe this will sort of keep rent prices in check in the city.”