Some disappointed with STR licensing delay as Charlottetown says nobody getting 'free pass'

The City of Charlottetown is now enforcing regulations meant to curb short-term rentals, though a licensing system will be on hold for a little longer.

A 13-month grace period ahead of the implementation of new zoning rules ended Tuesday, March 28.

Short-term rentals in the Prince Edward Island capital must all now be in owners' primary residences, separate apartments can't be rented out, and owners are not allowed to have multiple properties.

Housing advocates on the Island say the regulations are a big step forward, and will help regulate the city's rental market as many Islanders continue to struggle to find an affordable place to live.

But the city says there's still more work to be done.

Licensing rules that would establish fees, inspection regimes, and insurance and compliance requirements are on pause following a city council meeting Monday. 

City staff advised councillors to put the licensing rollout on hold until Oct. 31 so they could have time to complete the bylaws. They pointed out the bylaw draft was missing occupancy and inspection requirements.

"They felt that they had a few things that they weren't quite ready for," Deputy Mayor Alanna Jankov told CBC News. "They just needed to ensure they had the necessary resources in place for the proper implementation of the enforcement piece."

But housing advocates still question the delay.

"They had plenty of time to work out an enforcement strategy over the grace period. Now, they're saying they need pretty much just until the exact end of tourism season," said Cory Pater with P.E.I.'s Fight for Affordable Housing.

"It feels like it's not a delay to give time to build the enforcement strategy. It feels like it's a time to let tourism operators and STR operators keep making money off of their illegal hotels."

Zoning bylaws still apply, city says

Jankov said staff wanted to make sure there were inspections to ensure people's safety, including making sure each unit for rent has proper exits and electrical panels as well as fire extinguishers and smoke detectors.

She said the zoning bylaws still apply and "nobody gets a free pass."

Charlottetown residents who want to set up a short-term rental need to fill out an application, and the city will check to see if it's compliant with the bylaws.

The city still needs to hire a bylaw enforcement officer. The city's operational budget, which will be released at a council meeting Friday, will empower the Planning and Heritage Department to hire one, Jankov said.

"If there are folks out there that are not following the zoning and development bylaw ... [there] would be a letter. It would be letting people know, 'Hey, you're not in compliance, come on in to the planning department. Let's figure out next steps for you,'" she said.

"Once we have the summary offence ticketing bylaw in place, then there'll be distinct penalties in terms of fines. But for now it would be the same way you would enforce any bylaw."

Airbnb seeks more permissive rules

Meanwhile, the regional lead for Airbnb in Canada said the service is in talks with owners to help them figure out which requirements they have to follow.

Nathan Rotman said he's happy to see that the Charlottetown bylaws allow for secondary and garden suites to be used as short-term rentals. He adds that tougher bylaws would affect the local tourism industry more.

The more restrictive the bylaw is, the less people will be able to share space in their home — and quite frankly, the fewer tourists will have options to visit Charlottetown.— Nathan Rotman

"Obviously the more restrictive the bylaw is, the less people will be able to share space in their home — and quite frankly, the fewer tourists will have options to visit Charlottetown," he said.

Rotman said a lot of Airbnb hosts are renting as a way to supplement their income at a time when the cost of living is rising. 

He said the impact of STRs on the affordability of the housing market has shown to be "immaterial" in other Canadian cities.

He said Toronto, for example, "regulated to a strict primary residence restriction in 2021. The cost of housing in Toronto has continued to increase, the cost of rent in Toronto has continued to increase, the availability of homes in Toronto has continued to decrease.

"I think it's an easy argument for regulators and it's an easy argument for some individuals. But for the most part, it hasn't [been] borne out in the statistics."

Pater disagrees, saying regulations will provide some relief for the city's housing market, which continues to display low vacancy rates.

"We are so stressed for units right now," he said. "People are still having issues finding places, and even though they might not be affordable units ... they're still going to be units on the market. And that's going to be a relief to them."