On August 26, 2019, the Local Planning Appeal Tribunal (LPAT) began a seven-day hearing for an appeal to the City of Toronto’s amendments to short-term rental bylaws. The amendments to the bylaws were approved on December 7, 2017 and January 31, 2018 by the City of Toronto Council; but were subsequently appealed.
The new bylaws were legislated to target Airbnb-type short-term rentals. The key changes include:
- allowing for short-term rentals only in a principal residence;
- limiting rentals up to three bedrooms or the entire residence;
- restricting the rental of an entire residence to a maximum of 180 nights per year if the tenant/owner is away;
- requiring a registration of each short-term rental with the City of Toronto ($50 fee);
- collecting a 4 per cent Municipal Accommodation Tax on all short-term rentals fewer than 28 consecutive days;
- requiring rental companies such as Airbnb and VRBO to pay a one-time licence application fee ($5000) and to pay $1 per night booked through them.
The appellants Jeff Hodgart, Alexis Leino, Desirée Narciso, and Westhaver Boutique Residences Inc. have argued that short-term rentals of entire suites offer many benefits. Sarah Corman, counsel for Toronto realtor Alexis Leino, has argued that short-term rentals provide flexibility for homeowners and offer cheaper options for visitors and newcomers to Toronto.
She said: “The city is now, with a sledgehammer, gutting this important and flexible form of short-term accommodation without sufficiently considering or understanding the likely impacts of doing so.” Corman said that the current rental housing shortage is a result of the government’s failure to build rental-specific housing and is not because of short-term rentals.
Jason Cherniak, counsel for Westhaver Boutique Residences Inc., asked: “Was it my client’s responsibility to build purpose-built rental housing in the City of Toronto? …. Was it anybody’s responsibility to actually build purpose-built rental housing? … Does that mean that private property owners should be forced to use their property as rental housing essentially to make up for that inability of the city to encourage purpose-built rental housing?”
His client runs five rental properties in downtown and rents out a variety of short-term housing ranging from one-bedroom basement apartments for $138 per night to a four-bedroom house for $498 per night. Cherniak said that new bylaws would force his client out of business.
The City of Toronto, on the other hand, has argued that the proposed bylaws help maintain the accessibility and affordability of long-term rentals. Narmadha Rajakumar, Toronto senior planner, testified at the Tribunal that “The bylaws also help to achieve the city’s Official Plan objectives of ensuring the adequate provision of residential rental housing … by ensuring that potential residential rental units are not lost to commercial short-term rental accommodation.”
She said that short-term rentals would drive up rents and the new bylaws help ensure “a range and mix of housing options, including second units and affordable housing to meet the projected needs of current and future residents.”
David Wachsmuth, a McGill University professor of urban planning, testified that the new bylaws would prevent landlords from renting multiple homes or renting out more than three individual rooms per home. He estimated that the new bylaws could effectively free up 5,300 short-term rentals to alleviate the city’s housing crunch.
Over thirty-two issues have been drafted by the City of Toronto and the appellants for the LPAT hearing. The new bylaws are put on hold until the LPAT decides on the issues. The hearing is scheduled to take place until September 4th, 2019, but may be extended if necessary.