A New Decade of Airbnb – What Is New and Why It Changed

A New Decade of Airbnb – What Is New and Why It Changed

_

 

As you may have heard the City of Toronto has been trying to slow down the amount of Airbnb properties in the city. This comes as a disappointment to many investors and Airbnb business owners. However, plays an important role is affordability and inventory for renters and buyers in Toronto. The major reasoning behind this is that Airbnb properties occupy a housing unit that otherwise could be used as a long term rental. With the shortage of rental units in the city, and the skyrocketing prices of rents, the city is trying to do everything in their power to get this under control. Airbnb has received mixed reviews from condo owners, as many feel they reduce the appeal of a building due to the number of short term visitors not treating the building with as much respect as an owner or long term rental tenant. Furthermore, with the recent shooting that took place at an Airbnb in CityPlace, there is now more of an urgency to get this under control. One thing Airbnb has proposed going forward was to not allow anyone under the age of 25 to use their service.ย 

 

The city has set forward a bunch of regulations that hosts will have to abide by if they want to continue Air BnBing their properties

 

  • People can host short-term rentals in their principal residence ONLY โ€“ both homeowners and tenants can participate.
  • You can rent your suite for a maximum of 180 days a year
  • People who live in secondary suites and laneway suites can also participate, as long as the secondary suite is their principal residence.

 

Furthermore, if that werenโ€™t enough, the city will require each host to pay $50 a year to register their Air BnB with the city, and pay 4% Municipal Accommodation Tax (MAT) on all rentals less than 28 days. Also, Air BnB and other short term rental company, will have to pay 1$ to the city for each night they have a unit booked. This is probably how the city is going to keep tabs on who has an Air BnB property in the city.

 

As you can see, this is going to become a very big nuisance going forward. A lot of Air BnB hosts are at a fork in the road with what to do with their investments. I have seen many of my clients transition to doing 1 year furnished or unfurnished rentals, which still can be very lucrative and less hands on.ย 

 

If the returns of doing long term leases are no longer appetizing, another option is to look at other lucrative real estate investments in Toronto. You can always sell your Air BnB property for greener pastures. Investing in pre-construction condos, freehold triplexes, and laneway potential properties can all be attractive investments in the City of Toronto.

 

Regardless of which way you choose to go, we are here to help you every step of the way. For more information about your real estate investment strategy, give us a call!

 

Cheers,

Chris & Jeff

 

 

No Comments

Post A Comment