'We have been bullied': B.C. short-term rental legislation sends waves through housing market

A little more than two weeks have passed since the B.C. government rolled out proposed legislation to crack down on short-term rentals in B.C. in an effort to correct the ongoing housing crisis.

Now the dust has begun to settle and the impact of that legislation is beginning to come to light.

Three and a half years ago Steve Gordon and his wife, Sharon, retired. The couple sold their home in Esquimalt and bought two condos – one in Squamish and a small unit in the Janion building in downtown Victoria.

“Because we move between our children,” said Gordon. “Some live here and some live there.”

They call themselves collateral damage of the province's crackdown on short-term rentals. That’s because in between stays, they rent their unit on the short-term rental market. They do that to supplement their retirement investments.

“We saw this and we bought it knowing that we can Airbnb it,” said Steve. “We’ve done everything legally and we actually paid a premium because of that.”

They don’t want to sell, nor do they want to rent the unit on a long-term basis because that defeats their reason for buying the studio apartment in the first place.

“The property value definitely has gone down,” said Steve.

“I’m seeing huge attrition of my clientele,” said Nancy Paine, CEO and owner of SpaceHost, a short-term rental management company in Victoria.

Paine says after the province's announcement a little more than two weeks ago, she immediately lost 30 per cent of her business.

“Twenty per cent of my clients are listing on MLS right now,” said Paine.

Others have decided to list later and 43 per cent of her clients are in a holding pattern, trying to decide what to do by the deadline of May 1. That is when the proposed legislation will kick in.

“I don’t think my business will exist in January or certainly by May 1,” said Paine.

The question is whether the province's plan is sparking change ahead of next year's deadline to put more long-term rentals on the market?

Rentals.ca has crunched it’s October numbers and in B.C., rental units listed on its platform are up 21 per cent. It is unclear how many of those units were short-term rental converts.

The website says in the B.C. capital region, the early tides of change have been slower than the provincial boost in rentals.

“We’re starting already to see signs of short-term rentals being converted into long-term rentals,” said Doug King, executive director of Together Against Poverty Society.

Kings says the non-profit is hearing of some landlords making the jump into the long-term market but there is a catch. Long-term rental units in the Janion building are currently being listed for around $2,000 a month. That is not exactly affordable housing stock when you consider the average size of the units is around 300 square feet.

“It’s not the low-income units that we really need,” said King. “I think you’re going to see some of these short-term rental operators moving into the long0term market and having to adjust and realize that they’re not going to make as much with long0term rentals.”

Back at the Janion building, Sharon and Steve Gordon have not yet made a decision on what to do with their unit. What they do know for sure is renting it out on a long-term basis does not work for them.

“You know what? We have been bullied,” said Gordon.