NAVIGATING BC’S NEW SHORT-TERM RENTAL LEGISLATION: A GUIDE FOR PROPERTY OWNERS

Navigating BC’s New Short-Term Rental Legislation: A Guide for Property Owners

The recent introduction of legislation by the BC Government to regulate short-term rentals has left property owners with some important decisions to make. In this guide, we will help you explore the three primary options available to you and provide steps to understand which choice aligns with your goals and circumstances.

Option A: Keep the Short-Term Rental Running

If you’re considering maintaining your short-term rental, it’s crucial to familiarize yourself with the details of the new legislation and any obligations it places on property owners. Here’s what you need to know:

  1. Primary Residence Requirement:
    • The principal resident requirement will apply province-wide in municipalities with a population of 10,000 and over (and adjacent communities). If your listing does not include a valid business license, the short-term rental platform must remove the listing at the request of the local government.
  2. Displaying a Business License:
    • Some local governments require a business license for a host to operate a short-term rental. In areas where a business license is required, short-term rental hosts will be required to display a valid business license number on their listing.
  3. Increased Fines and Tickets:
    • The maximum fine that regional districts can set for prosecutions of bylaw offences under the Offence Act will increase from $2,000 to $50,000. This aligns with the maximum fines for municipalities under the Community Charter.
Option B: Turn Your Short Term into a Long-Term Rental

Converting your property into a long-term rental can be a viable option. However, it’s important to understand what this entails. Here’s how to determine if it’s the right choice:

  1. Assess the Current Rental Rates:
    • Research the long-term rental market in your area, including rental rates, demand, and vacancy rates. Project the potential income from a long-term rental, factoring in expenses, maintenance, and vacancy periods.
  2. Understand Tenant Rights:
    • Familiarize yourself with tenant rights and responsibilities as a landlord, including tenancy agreements and regulations. Keep in mind that tenants have substantial rights, such as restrictions on rent increases and eviction challenges.
  3. Selling a Tenanted Property:
    • Selling a tenanted property comes with its challenges, including working around tenant rights, limited staging options, and difficulties in aligning sale dates. Additionally, potential buyers might prefer vacant properties, reducing your pool of interested parties.
Option C: Sell Your Short Term Rental

If selling your short-term rental is your preferred choice, it’s essential to understand how to navigate this option. Keep in mind that the latest legislation has not significantly resolved housing shortages and only a small percentage of short-term rentals are likely to transition to long-term rentals. Here’s what you should consider:

  1. Understand the Current Market:
    • Most buyers in the current market are end-users, not investors. Knowing who is buying and what appeals to them is crucial. Consider being among the first to market to avoid competition.
  2. Financial Assessment:
    • Review your current financial situation, including outstanding loans, equity, and the property’s market value. Many current owners may have purchased their property with the intent of using it as a short-term rental, and the new legislation might hinder their ability to do so.
  3. Hire a Professional Realtor:
    • Marketing your property effectively is essential. Consider hiring an experienced Realtor who excels in marketing and can make your property shine. This includes professional photos, drone shots, floor plans, and the use of social media platforms to reach potential buyers.

As a property owner in BC, the new short-term rental legislation presents you with a range of choices. Whether you decide to keep your short-term rental, transition to a long-term rental, or sell your property, understanding the implications of each option and considering market dynamics will be key to making the best decision for your circumstances. Remember that professional guidance from a Realtor can help you navigate these changes and make the most out of your property investment.