Canada's Condominium Magazine
The Ontario government has obviously heard Toronto taxi drivers’ complaints about unfair competition from Uber and clearly doesn’t want a fight with the hotel industry. The hotel industry says it is already losing money to the disruptive home-sharing business, Airbnb. In a carefully worded statement, Queens Park says it supports the sharing economy insofar as that economy supports growth and fosters innovation while protecting consumers and workers, promoting a level playing field and ensuring tax fairness. Who could quarrel with any of that? The statement serves as background to today’s announcement that the government is partnering with Airbnb in a pilot project that is basically intended to make sure that Airbnb hosts pay their taxes.
There are, apparently, 11,000 of these hosts in Ontario. Airbnb has agreed to inform them all, by email, that they are required to report the income they receive, and to inform them about consumer protection and other regulatory issues, including the need for smoke and carbon monoxide detectors. Together, the government and Airbnb will create a website for posting pertinent information.
Most condo corporations don’t allow short-term rentals
Will this new semi-official status for Airbnb mean that we see more condo owners getting in on it? There’s no question that Airbnb is growing in popularity with tourist travelers. It now boasts more than 2 million listings in 190 countries. Airbnb says that 60 million guests have stayed with its hosts around the world so far (it started in 2008), and it is now looking to expand into the business traveler market. Even in Cuba, where Internet access is virtually non-existent, and most people don’t even have bank accounts, let alone credit cards, Airbnb is growing.
Many of those hosts who are opening their homes to strangers for cash live in condominiums that they own, and many live in condos and apartments that they are renting from someone else. But if you’re a condo owner, and if you’re considering getting in on the Airbnb action, there are two big questions to ask. Is it a good idea to rent out your condo by the night? Is it even permitted?
To find out whether it’s permitted, check your condominium declaration. Most declarations specify how the individual suites can and cannot be used, and most contain clauses stating that short-term rentals are not permitted. Since Airbnb is relatively new, however, there are doubtless many older condo corporations out there that have not caught up, and may have outdated language in their declarations regarding the rental of units. We have heard of at least one condo building in downtown Toronto where condos are reportedly being rented by the hour, legally. The declaration apparently states that there is “no minimum term” for the lease of a unit. In general, though, it can safely be assumed that a private residence condo cannot be rented out by the night.
If short-term rentals are not permitted, a condo owner who went ahead and listed his condo on Airbnb anyway would almost certainly find himself facing legal action by the board (assuming they found out about it).. The board could also take steps to make it impossible for any Airbnb guests to get into the building by deactivating key fobs or having security keep them out.
As for whether it’s a good idea for a condo owner to be an Airbnb host, irrespective of the legality, that depends. Assuming that the guests who show up are all decent, respectable folks who pay up and don’t trash the place or make a lot of noise and bother the neighbours, one could argue that there is no problem in it.
Even so, the main source of trouble is likely to be from other owners who might not like the idea of sharing their community with an ever-changing bunch of strangers. Security, after all, is one of the main benefits of living in a condo. Would one feel more secure or less secure knowing that strangers from who knows where were coming and going in one’s home?
On the other hand, if guests are not so respectable and do damage to the common elements, for example, the owner will be held responsible. Is that a risk worth taking?