'Ghost hotels' on Airbnb violate city rules for short term rentals: report
Published Wednesday, January 9, 2019 4:18PM EST Last Updated Wednesday, January 9, 2019 7:54PM EST
A new report by a housing advocacy group suggests that short-term rentals continue to cut into Toronto’s already tight market while firm regulations hang in limbo.
Fairbnb, a coalition consisting of organizations representing the hotel industry, reported Wednesday that 76 per cent of all Airbnb listings in the city are what are referred to as “ghost hotels” – properties bought entirely to be used as short term rentals.
Fairbnb claims those so-called ghost hotels violate the city’s rules for short term rentals – rules that are not yet in effect.
The city passed regulations on short term rentals back in 2017. However, those regulations were appealed to the Ontario municipal board and the appeal case won’t be heard until August of this year.
With support from Ward 10 Coun. Joe Cressy, the advocacy group called on Airbnb to remove those listings from the site while the two sides wait in legal limbo.
According to Cressy, there are currently 19,000 Airbnb listings available in the city.
Of those, the group says 6,500 are housing units that do not comply with the city’s standards for short term rentals. The report estimates that 73 per cent of Airbnb’s total revenue stems from those non-compliant listings.
“We have a vacancy rate for rental housing of 1.1 per cent. It should be 3 per cent. What that means is we need 5,032 units to get from 1.1 to 3 per cent vacancy,” he said.
“If Airbnb were to comply and delist these 6,500 units, that would go a long way to creating a more affordable place for people to rent and live.”
Some of the rules the city has passed for short term rentals include:
- It must be a principal residence only
- Up to three rooms can be rented for unlimited nights
- An entire residence can only be rented if the owner is away for more than 180 nights per year
Thorben Wieditz, a researcher with Fairbnb, said if the city and province are working together on a housing supply action plan, they need to look at the impact Airbnb and short term rentals are having on the supply goals.
“(There are) over 8,000 listings are not compliant with the cities rules and 6,500 thousand entire homes have been turned into ghost hotels. These are mostly in the downtown core, around the subway lines, in the areas that are most accessible to the people where there is more access to jobs,” Wieditz said. “They are in areas where people actually want to live and need to live.”
“Quite frankly, it’s up to Airbnb to show what the impact of short term rentals are on municipal governments.”
Airbnb rejected the group’s findings, claiming the report is “based poor research.”
“This report is based on faulty assumptions and poor research, and is yet another example of the well-resourced and clearly biased hotel lobby, seeking to villainize families who are making a little extra income by sharing their homes,” Alex Dagg, Airbnb’s spokesperson, wrote in an email.
“It is troubling that the hotel lobby continues to advocate for bypassing a democratic appeal process put in place to give voice to the citizens of Toronto.”
The company said it “wants to be regulated,” but within reason.
“To be clear, Airbnb wants to be regulated - we have always advocated for fair, sensible home-sharing regulations and look forward to continuing our collaborative relationship with the City of Toronto.”