With Grand Prix weekend just hours away, Sarah has been scrambling to make sure her rental properties are ready to roll.
She
arranges for keys to be dropped off and has the rooms cleaned so her
guests can settle in and enjoy the festivities. She doesn’t manage a
hotel or a bed and breakfast, Sarah rents out rooms on Airbnb, the
American website that has helped convert thousands of rental units in
Montreal into hotels for tourists.
Her boss owns 12 properties in
the city that used to be rented, year-round, by families and students.
Since converting them to Airbnb units four years ago, it’s been a cash
cow for him.
But a new set of rules outlined by the Quebec government Wednesday would force the business to shut down or face steep fines.
“In
Montreal, hotels are expensive and apartments are not. I think there
was an opportunity and a lot of people seized it,” said Sarah, who did
not want her name published for fear of losing her job. “The new rules
change everything though.”
The provincial regulations, which come
into effect this fall, force anyone renting out their “secondary”
residence — like a fully furnished apartment or cottage — to register
with the Corporation de l’industrie touristique du Québec. That would
place it under the same regulations and zoning laws as the hotel
industry.
One city councillor, speaking on behalf of Montreal’s
mayor, says companies like Airbnb have taken up to 5,000 units off the
rental market and made life harder for working families near downtown.
“Right
now, we’re approaching a rental crunch that’s nearing crisis levels,”
said Richard Ryan, a municipal councillor in the Mile-End district. “It
has made it almost impossible for some families, couples and students to
find affordable housing in the city.
“Whether it’s a family that
rents posts the extra unit in their triplex (to Airbnb) or a company
that has 10 or 20 properties they’re treating as hotels, it adds up. If
the situation gets any worse, we’ll be in a crisis like the city hasn’t
seen in 20 years.”
This year, the vacancy rate in Montreal’s
rental market is just 1.9 per cent. Ryan says anything below 3.5 per
cent sways the balance of power entirely away from renters and to
property owners in Montreal. He hopes the provincial regulations can put
thousands of apartments back into circulation.
Starting this
September, anyone who wants to rent their property for less than 31
consecutive days will have to pay an administrative fee of about $75 and
register the unit with Revenu Québec. Anyone posting without a
registration number or otherwise failing to comply will be subject to
fines of up to $10,000 for an individual and $25,000 for a corporation.
The rules also give Revenu Québec the power to investigate and levy fines.
“It lets people know we’re not messing around,” said Ryan. “Finally, it’s a law with some teeth.”
Maxime
Roy-Allard, a renter’s rights advocate, calls the regulations a step in
the right direction, but cautions that they don’t go far enough.
“It’s
still possible for people to post their secondary homes on Airbnb, and
that’s unacceptable for us,” said Roy-Allard, a spokesperson for
Regroupement des comités logement et associations des locataires du
Québec. “Either make it impossible to rent out that secondary residence
or limit the amount of days per year that people can do that.
“Airbnb
will present itself as a way for students or low-income people to make
ends meet, to help them get by at the end of the month, but that’s not
the case. Most landlords won’t let their tenants post on Airbnb.
“And
this might incite people to rent larger apartments for themselves, ones
that would usually go to families, and rent out the extra room on
Airbnb. Try getting a big apartment in Montreal, it’s very, very rare.”
In
a statement released Wednesday, Alex Dagg, Airbnb’s head of public
policy, said she was disappointed with Quebec’s decision but that the
company would continue working with the province. She said the
regulations cause “needless friction” for everyday people who would want
to rent out their secondary properties.
Sarah, who also works in
the service industry, says her time as a property manager has helped her
develop business acumen and even caused her to consider going back to
school. But she also recognizes that, from the outset, the rental
business was in a precarious legal position.
“I mean, in terms of
zoning and taxes and all that, you’re kind of playing with fire,” she
said. “When you’re like me and working two jobs and trying to save up
money for a house or to start your own life, you take risks.
“I’m not so sure I’d take those risks with these regulations.”
ccurtis@postmedia.com
