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Taking stock

Posted: May 4, 2017 at 9:28 am   /   by   /   comments (0)

Council investigates vacation rentals

Angus Ross is concerned. He sees an increasing number of whole family homes used as short-term vacation rentals. He’s especially concerned about those whose owners use websites like Airbnb.

Ross gave a deputation to a committee of council on Thursday expressing some of the reasons for his concerns, including a sharp rise in the cost of housing, lack of long-term rental stock and a degradation of neighbourhoods as some residents find themselves surrounded by vacation rentals instead of neighbours.

“Lower-cost housing is being purchased by investors and taken off the market for local first-time buyers. The local economy, with much of it in the hospitality industry, does not have a large number of well-paying jobs and the ability of young locals to compete against outside investors is extremely limited,” Ross told council. “The issue is not just… rental sites. It is part of what is the future of the County is to be. A thriving multi-generational community with facilities for all age groups, or a largely older population and absentee landlords where numbers reduce significantly in winter months. This is the choice faced by Council.”

Councillor Bill Roberts questioned Ross about an item in his deputation that recommended taxing these residential properties differently. Ross suggested rezoning.

“Essentially that’s what they are. They are commercial properties,” Ross told council. “I’m suggesting the possibility of rezoning from residential to commercial, which would then generate higher tax revenue for the municipality.”

Picton councillor Lenny Epstein, who has publicly made it known he has income property advertised on Airbnb, recused himself from the conversation. Epstein sits on the Prince Edward-Lennox and Addington Social Services committee and has been an advocate for affordable housing since he began his post.

Epstein says that while, as a private citizen, he has thoughts on vacation rentals, he’s concerned decisions he would make as a councillor would appear coloured by his personal interests.

“Even though it’s an issue that’s broad, and not just about my particular property, it would be possible that there would be an impression that the comments that I make about the issue would be coloured by the fact that I have a direct stake in it. So I think the right thing to do in this case is to pull back,” says Epstein. “I know my opinions will be voiced by others who have a direct stake in [this issue], but who are not also municipal councillors. I imagine this is going to be an issue that will create a lot of discussion in the community, and I will follow it with great interest.”

The rest of council, at the behest of Athol councillor Jamie Forrester—who strongly agreed with the comments Ross made—sent an order to staff to investigate potential opportunities to limit, tax or regulate these rentals.

The study, which will likely take place within Carbone’s department, will take time to complete, and won’t necessarily lead to any change in bylaws or policy. But according to Emily Cowan, chair of the Prince Edward County Chamber of Tourism and Commerce, examining options is a good thing.

Cowan says the new staff assignment is a logical next step to that study, that these businesses could be taxed in part to ensure they’re being run and insured properly. A new regulation in Ontario’s budget allows for that, with municipalities now able to charge a special hotel tax to Airbnb-type properties and apply that money toward destination marketing.

In the County, where such marketing is already in the municipal budget, it could free up cash for housing services, an issue Cowan says is inextricably linked to shortterm accommodations, since they both make use of the County’s stagnant housing stock.

“When we speak to our members about their biggest barriers to carrying on successfully, affordable accommodation comes up, because their employees can’t afford to find a place to live here. Especially minimum wage hospitality industry [jobs]. Which is ironic, because it’s the hospitality industry that builds the tourism, but then the people who are washing dishes and serving and in the tasting room really struggle to find a place to live here.” says Cowan. “As much as we can advocate on behalf of affordable housing—because we’ve been asking for this for several years—what we’re looking at right now is accommodation. And I know that the two things go hand in hand.”

The economics of smaller accommodation businesses and single vacation rentals have not been lost on the County. In partnership with the chamber, two committees have been formed. One is reviewing the economic viability of increasing accommodations, such as larger hotels. The other will develop health and safety guidelines for landowners to apply to avoid issues with property damage, personal liability, or even just poor experiences by visitors.

“We’ve talked to the insurance industry; we’ve talked to emergency services, fire prevention, public health, paramedics, OPP. We’ve spoken to vacation rental managers and we’re going to talk to B&B providers,” says Cowan. “We’ve learned quite a lot along the way. But at the end of the day, we rely very strongly on tourism, and we have to make sure that people who come and visit here, who expect to have a safe place to stay have that… we need to know how many businesses there are and that they’re operating at a safe level.”

Although there is likely overlap, each of the three websites popularly advertising vacation rentals by owners of single-family homes features between 250 and 300 listings in Prince Edward County. With about 13,000 private homes in the County, that’s not a huge percentage.

But it has an effect. Anecdotally, there are problems developing. People living in Wellington and Picton are complaining that their neighbours are slowly turning into absentee landlords, whose visitors come with no investment in the community.

Cowan says she doesn’t envy council the job they have created for themselves to manage the head-on collision between a dwindling housing stock and a rising demand for short-term rentals.

“It’s really difficult because people have the right to spend their money how they would like to, legally. If you would like to buy a second home you should have the right to buy a second home. However legislation and bylaws have come into place in different jurisdictions that helped to mediate that so that there is enough stock for all incomes.”