A for rent and a for sale sign are displayed on a house in a new housing development in Ottawa on Oct. 14, 2022.Sean Kilpatrick/The Canadian Press
Nathan Rotman is the policy lead for Canada at Airbnb.
Canadians are struggling, pinched between twin pressures – an affordability crisis and a housing crisis, inextricably linked to each other. In response, governments have enacted a range of new policies, from targeted financial relief to incentives aimed at tempting builders back into the marketplace.
Canadians should be encouraged by the urgent action governments at all levels have started to take to ease these crises. It’s through smart, ongoing investments in new housing that we can ensure everyone has an affordable place to call home.
Unfortunately, alongside smart policy moves, we increasingly see another tactic: targeting Canadians who share their homes as short-term rentals – a Hail Mary attempt to address the country’s housing affordability crisis. In the past year, governments at all three levels enacted new policies to make it harder for Canadians to rent out their homes short-term.
But scapegoating short-term rentals is not sound housing policy. Entire home listings on Airbnb make up less than 1 per cent of the overall housing supply in the country. Even if every short-term rental were made available on the long-term rental market, it wouldn’t scratch the surface of the 3.5 million housing units the country needs to build by 2030 to close the supply gap.
The truth is, the majority of homes on short-term rental platforms such as Airbnb would not otherwise be available for long-term use. The vast majority of Airbnb hosts in Canada share a single home on the platform, often their primary residence or a family cottage, with the typical host doing so only occasionally, about 50 nights a year. These are not real estate barons with multiple properties, as the popular narrative would have you believe, but rather Canadians who have worked hard to buy their homes or keep their properties for family use.
We recently shared Airbnb data with the Conference Board of Canada to determine whether short-term rentals are driving up housing prices, as so many critics allege. The study concluded that Airbnb rentals are simply too few in number to have a discernible impact on housing affordability, and their impact on rent prices is “negligible.”
Importantly, the study also found that strict regulations, including those that limit short-term rentals to residents’ primary residences, did not drive an increase in units in the traditional rental market. We are seeing this play out in the real world in real time. Vancouver enacted a strict primary residence restriction in 2018, and Toronto followed suit in 2021 – both removing thousands of listings. And yet rents have increased in almost every month that followed, and housing supply remains untenable in both cities.
The key to short-term rental regulations is balance, and we’re a willing partner to any city looking to do so. Across Canada and around the world, we have worked with communities of all sizes to support smart, reasonable policies that help address local concerns while also advocating for the benefits that come with short-term rentals.
Our hosts are increasingly telling us they are sharing their homes to help deal with the rising cost of living. Further targeting hosts won’t bring homes onto the long-term market or make housing more affordable, but it will make life more difficult for the nearly eight in 10 hosts who say income from home sharing has helped them cope with high inflation. Solving Canada’s housing crisis cannot come at their expense.
Housing supply has dried up after decades of underinvestment, zoning limitations, higher construction costs and access to labour – even as demand presses upward. Further regulating short-term rentals won’t get more houses built, won’t help those struggling with rising mortgage payments and won’t solve financing issues for builders.
These critical problems require serious, informed responses. Pinning the blame on short-term rentals and hosts for the housing crisis may make for a political win and an easy headline – after all, it’s a seemingly simple solution to the complex challenge. The problem is, doing so isn’t just bad policy, it’s ineffective. And, when it comes to both critical issues, time isn’t something we can afford to waste. Especially when attempting to fix one crisis comes at the expense of deepening the other.