Access Law Group FirstService Residential pdougan@accesslaw.ca - - PowerPoint PPT Presentation

Sean Ingraham FirstService Residential

sean.ingraham@fsresidential.com

Phil Dougan Access Law Group

pdougan@accesslaw.ca

Negative News in the Press

• Condo owner does battle with the Airbnb next door
• 'This is my home, and here I have a hotel room, essentially now, right next

to me,' Edmonton owner says

• By Min Dhariwal, CBC News Posted: Oct 19, 2016 6:30 AM MT Last Updated: Oct 19, 2016 6:30 AM MT

Negative News in the Press

• Ottawa hotels ask city to regulate Airbnb
• Local hotels want Ottawa to follow Vancouver and Toronto down the

path to regulating short-term rentals

• By Kate Porter, CBC News Posted: Oct 31, 2016 5:42 PM ET Last Updated: Oct 31, 2016 5:43 PM ET
• N.Y. enacts restrictions on Airbnb, with fines of up to $7,500 US
• The Associated Press Posted: Oct 21, 2016 12:15 PM ET Last Updated: Oct 21, 2016 5:17 PM ET
• Neighbour complaints led Vancouver to sue over Airbnb rental
• City's chief licensing inspector says more court cases in the works

for renegade hoteliers

• Jason Proctor · CBC News October 18, 2016

Negative News in the Press

• Berlin stops Airbnb renting apartments to tourists to protect affordable

housing

• Website's listings in German capital fell by 40% in the last month
• Matt Payton
• Sunday 1 May 2016
• “But from 1 May, the new law entitled "Zweckentfremdungsverbot" bans the

short-term let of entire apartments to tourists without a city permit.”

• “If found flouting these rules, Berliners can be fined up to €100,000 (£78,371).”

Negative News in the Press

• Europe's crackdown on Airbnb
• Vacation rentals are still available, but laws in many cities are getting

tighter

• Feargus O'Sullivan
• @FeargusOSull
• Jun 20, 2016

Iceland

Spain

Good News?

• Airbnb's $400M contribution to Vancouver economy gets mixed reviews
• Study highlights economic boost from Airbnb but fails to impress those

concerned about housing affordability

• By Mike Laanela, CBC News Posted: Nov 01, 2016 2:11 PM PT Last Updated: Nov 01, 2016 3:42 PM PT

Agenda

• Why do people use the service?
• What technically are short-term rentals such as Airbnb?
• Homeowners that rent short-term: Positives and risks
• Government’s role
• Strata Corporations – Action is needed
• Bylaw amendments
• Next Steps
• Questions

Why Do People Use Services Like Airbnb?

• Choice – More locations and types of accommodations
• Price – Usually less then a hotel
• Service – Some “hosts” have better service then hotels
• Examples: business professionals, backpackers, vacationers

What are Short-Term Rentals?

• Airbnb, VRBO, House trip (Expedia) – Short-term rental
• Homeowner (or tenant) contract with the service company
• If you reside outside of the USA or China, you are contracting with Airbnb

Ireland

• Strictly speaking the homeowner is not “renting” out their unit to short-term

renters

Is it a Residential Tenancy?

• The Residential Tenancy Act (the “RTA”) concerns itself, not surprisingly, with

residential tenancies (as opposed to commercial tenancy, for example). The RTA defines a tenancy as ‘a tenant's right to possession of a rental unit under a tenancy agreement’. This definition requires further definitions:

Definitions:

• A "tenancy agreement" means an agreement, whether written or oral,

express or implied, between a landlord and a tenant respecting possession of a rental unit, use of common areas and services and facilities, and includes a license to occupy a rental unit;

Nitty-Gritty

• Assignment and subletting
• 34 (1) Unless the landlord consents in writing, a tenant must not assign a

tenancy agreement or sublet a rental unit.

• (2) If a fixed term tenancy agreement is for 6 months or more, the landlord

must not unreasonably withhold the consent required under subsection (1).

• (3) A landlord must not charge a tenant anything for considering, investigating
• r consenting to an assignment or sublease under this section.

Who Cares?

• Occupants
• Where a tenant allows a person who is not a tenant to move into the premises

and share the rent, the new occupant has no rights or obligations under the tenancy agreement, unless all parties agree to enter into a tenancy agreement to include the new occupant as a tenant.

Poetic License

• A license is a permission to do that which would otherwise constitute a
• trespass. Such a privilege may be expressly conferred, such as through a

contract to enter a theatre to see a show, or it may be implied, such as when a shop is open for business to the public at large.

What This Act Does Not Apply To:

• 4 This Act does not apply to:
• (a) Living accommodation rented by a not-for-profit housing cooperative to a

member of the cooperative,

• (b) living accommodation owned or operated by an educational institution and

provided by that institution to its students or employees,

• (c) living accommodation in which the tenant shares bathroom or kitchen

facilities with the owner of that accommodation,

• (d) living accommodation included with premises that
• (i) are primarily occupied for business purposes, and
• (ii) are rented under a single agreement,
• (e) living accommodation occupied as vacation or travel accommodation.

What Else Could Airbnb Be?

Homeowner Who is Tenanting: Positives

• Positives:
• Earn income – Average of $466 a week
• Supplement a mortgage
• Sharing economy

Risk; It’s All Yours…………

“YOU UNDERSTAND AND AGREE THAT AIRBNB IS NOT A PARTY TO ANY AGREEMENTS ENTERED INTO BETWEEN HOSTS AND GUESTS, NOR IS AIRBNB A REAL ESTATE BROKER, AGENT OR INSURER. AIRBNB HAS NO CONTROL OVER THE CONDUCT OF HOSTS, GUESTS AND OTHER USERS OF THE SITE, APPLICATION AND SERVICES OR ANY ACCOMMODATIONS, AND DISCLAIMS ALL LIABILITY IN THIS REGARD TO THE MAXIMUM EXTENT PERMITTED BY LAW.”

Minimizing Risk? Insurance…

• “If you are a Host, you understand and agree that Airbnb does not act as an

insurer or as your contracting agent.”

• “Please review any insurance policy that you may have for your

Accommodation carefully.”

• “You agree that any legal remedy or liability that you seek to obtain for actions
• r omissions of other Members or other third parties will be limited to a claim

against the particular Members or other third parties who caused you harm. You agree not to attempt to impose liability on or seek any legal remedy from Airbnb with respect to such actions or omissions.”

Owner Agrees

• You represent and warrant that any Listing you post and the booking of, or a

Guest's stay at, an Accommodation in a Listing you post (i) will not breach any agreements you have entered into with any third parties, such as homeowners association, condominium, lease or rental agreements, and (ii) will (a) be in compliance with all applicable laws (such as zoning laws and laws governing rentals of residential and other properties), Tax requirements, and rules and regulations that may apply to any Accommodation included in a Listing you post (including having all required permits, licenses and registrations), and (b) not conflict with the rights of third parties.

Government

• Less income through the Municipal and Regional District Tax (MRDT) which is

a hotel tax that municipal governments can increase

• It makes the rental vacancy problem worse
• Too large to monitor or patrol – resources
• There was no real or significant enforcement in Vancouver or other

municipalities

• Oct 14th we have the first known legal action by the City

Vancouver Zoning Bylaw

• 10.20.5 No person shall use or permit to be used any housekeeping unit for a

period of less than one month unless such unit forms part of a hotel.

• Housekeeping Unit means a sleeping unit containing facilities for cooking;

[see section 10.20 for general regulations which apply to housekeeping units]

• Sleeping Unit means one or more rooms equipped to be used for sleeping

and sitting purposes; [see section 10.19 for general regulations which apply to sleeping units]

Or:

• 10.21.6 No person shall use or permit to be used any dwelling unit for a period
• f less than one month unless such unit forms part of a hotel or is used for bed

and breakfast accommodation

• Dwelling Unit, which means a self-contained housekeeping unit; [see

section 10.21 for general regulations which apply to dwelling units]

• Hotel, which means premises providing temporary accommodation by way
• f furnished sleeping, housekeeping or dwelling units, but does not include

Bed and Breakfast Accommodation;

Strata Corporations

• Risks
• Liability – Renter injures themselves and sues the Strata Corporation
• Insurance?
• Security – Recognizing your neighbour is the best security

Strata Corporations

• Recap – There is a market, financial incentive for homeowners, the

government is not going to significantly help, and there is risk for the Strata Corporation.

• The issue cannot be ignored!

Strata Corporations

• What suits our community?
• Downtown versus quiet townhouse complex? What sort of client will it attract?
• What to ban?
• All licensing
• All short-term rentals
• Homestays
• Bed and Breakfast
• Home swaps

Bylaws

Bylaws:

• Standard Bylaw 3(1)
• An owner, tenant, occupant or visitor must not use a strata lot…in a way that is
• (d) illegal; or
• (e) contrary to a purpose for which the strata lot or common property is

intended as shown expressly or by implication on or by the strata plan.

Bylaws

• Louis v. Strata Plan LMS 499, 2009 BCCA 54
• Residence = a man’s abode or continuance in a place
• While in the context of an age restriction bylaw and section 123(2), the

discussion was that there was some degree of permanence rather than the transience of a traveler or tourist.

Bylaws

Bylaws:

• Common rental bylaw (but not standard)
• The minimum period of time a strata lot must be rented is one month/six

months/one year (you pick).

Example of a bylaw

• No person may rent out, lease, sublease, license, sublicense or otherwise

grant occupancy rights to any strata lot in exchange for consideration of any kind for a period of less than one full month.

Enforcement

• Tracking short-term renters is not always easy
• Committee needed
• Volunteers are usually not too hard to find for rental sleuthing

Next Steps

• 1. Find out what the ownership wants
• Survey
• Information discuss
• Discussion at a general meeting
• 2. Have a bylaw crafted to reflect community’s feedback
• 3. Include bylaw amendment at a general meeting
• 4. Speak with your insurance provider to ensure proper coverage
• 5. Set up a committee and be mindful of privacy
• 6. Review situation annually