The BC Legislature passed the Short-Term Rental Accommodations Act (STR Act), formerly Bill 35, and it became provincial law on October 26, 2023.
There seem to be some misunderstandings about it – including suggestions that Victoria has the ability to control provincial legislation – so this post pulls together some information that might be useful.
First up, Canada has three levels of government. However, only two appear in the Constitution of 1867 – federal and provincial. Municipalities have no independent existence under the Constitution; they are literally created by provincial legislation.
Provincial legislation can change municipal laws, and even eliminate municipalities altogether. However, it’s not a two-way street: as creatures of the province, municipalities cannot control or change provincial laws.
On to STR laws…
Here is a link to BC’s STR Act, and a link to the webpage explaining the Act and the Government’s reasons for it. The BC Government also has a webpage with news release, backgrounders, and a technical briefing presentation.
The STR Act is wide ranging, and the Government notes that the purpose of the new rules is to:
- “Give local governments stronger tools to enforce short-term rental bylaws
- Return short-term rental units to the long-term rental market
- Establish a new Provincial role in the regulation of short-term rentals”
There are requirements for registration, for platforms to provide information, and for removal of unlicensed listings, plus larger fines for violations of the law, and more. It’s a large, complex set of changes addressing many different aspects of the STR business, and part of a broader set of housing policy reforms that the Province has released over 2023. Clearly the Government had been working on this for quite a while. As the Minister stated “This isn’t something we just created on the back of a napkin a couple weeks ago. This is work that has been happening for years.”
One of the bigger changes under the STR Act is the new rule banning short-term rentals that are not in a host’s principal residence (or their secondary suite or laneway/garden suite).
Section 14 of BC’s STR Act states:
“…short-term rental accommodation services must not be provided except in one or both of the following:
(a) in the property host’s principal residence;
(b) in not more than one secondary suite or other accessory dwelling unit that is in a prescribed location in relation to the property host’s principal residence.
(Note: Victoria already had such a rule, adopted by City Council back in 2017 – the Council before the Council before the current Council. This rule had been superceded by the BC’s Local Government Act, but the STR Act changed that, as well as directly banning non-principal-residence STRs under s.14.)
BC’s non-principal-residence ban kicks in May 1, 2024, and applies to roughly 600 STRs operating in Victoria. The Provincial Government described its reason for this change as helping to address the housing shortage, as other governments are doing:
“Short-term rentals are increasingly seen as contributing to global housing challenges, and in response, jurisdictions around the world are increasingly taking action to regulate, restrict or ban short-term rental of units, in particular short-term rental of units that could otherwise be providing long-term housing.”
Those 600 STRs will help with BC’s stated goal of “returning more short-term rentals into long-term homes for people” but it’s not yet clear in which way. Some may be sold back into the condo market. Others may be rented out to long-term tenants, and others may be empty and pay the vacancy tax (not likely many, or for very long).
The Government has announced other changes to make it more attractive to rent homes in the long-term market, e.g. hiring more staff and speeding up processes at the Residential Tenancy Branch. And of course Victoria’s desperate 1% vacancy rate means owners can be very selective about rental applicants.
What does the future hold for STR regulation? I have no idea what the province might change. They could come out with more big changes, or some finer adjustments, or nothing. Anyone interested in potential changes to the provincial law, should reach out to their MLA.
However, in my view, it’s certainly a good moment for Victoria to consider any changes that we might find useful in the wake of this significant change in provincial laws.
Should the City for example change our four bookings per year rule to a certain number of days per year?
Should the City commit to opting out of the non-principal residence ban when our vacancy rate hits 4%?
City bylaw changes, if any, are up to nine members of Council. But if you have ideas, I’m always listening.