The welcome mat for the short-term rental of Kelowna homes and condos has been effectively removed by sweeping new provincial and municipal regulations.
About 700 people will lose their licence to offer secondary properties to tourists and licences for the short-term rental of principal residences will be capped at the current level of 500.
A majority of city councillors say the strong measures are needed to free up more houses for long-term rental by Kelowna residents and clamp down on what they said was the considerable nuisance created by some tourists using short-term rentals.
But other councillors described the moves as unfair to property owners who depend on income from short-term rentals to make their mortgage payments.
The restrictions narrowly passed by council by a 4-3 vote. In favour were Mayor Tom Dyas and councillors Luke Stack, Mohini Singh, and Rick Webber. Opposed were councillors Ron Cannan, Charlie Hodge, and Gord Lovegrove.
The significance of the short-term rental issue in Kelowna was underscored by the fact that two councillors, Maxine DeHart and Loyal Wooldridge, could not participate in the discussion or vote on the matter because both of them own short-term rental units.
The new regulations will take effect May 1.
“Short-term rentals have had a tremendous impact on our long-term rental market and we are suffering as a city with the need for long-term housing,” Stack said.
But Lovegrove countered many property owners have come to depend on money they earn from short-term rentals: “We’ve heard from many, many people that this will put a hardship on housing affordability, by taking away their mortgage helper.”
Singh said she understood the short-term rental issue from both perspectives, those who regard them as a financial boost and neighbours who complain about noise and rowdy behaviour by people renting the units for a holiday in Kelowna.
“We heard from so many people at the public hearing about how it’s the only way they could afford their house. And then on the other hand we also heard from this one man about how he woke up to people puking on his front lawn and how his life had just become a nightmare, which is also not right. So what do we do?” Singh said.
Singh also noted the 498 people who currently hold licences for the short-term rental of their principal residence would likely be quite pleased with the city’s decision not to process any more such applications: “Those 498 have won the lottery, if nobody else can do it.”
Kelowna’s decision not to allow any more short-term rentals in a person’s primary residence goes further than the NDP government’s provincial regulations, which would allow that practice to continue elsewhere in B.C.
“I’m concerned with government overreach,” Cannan said. “I believe the province’s proposal is a more balanced approach between protecting people’s property rights while respecting residents in the community.”
Although he effectively cast the deciding vote, Dyas did not speak during the discussion to indicate why he supported the proposal from city staff to go further in restricting short-term rentals than the province is planning to do.
In a separate motion, council unanimously agreed to consider asking the province to do what Victoria has said it is not prepared to do: grandfather the licences for short-term rentals of secondary properties in Kelowna buildings where it is currently allowed by the city.
“In general, I’m thinking of Sunset Drive, Playa del Sol, Aqua, and some of those properties that were traditionally expected to have the capacity for short-term rentals,” Stack said.
City staff will prepare a report on exactly what properties would form part of the grandfathering request and bring that information back to council at a future date before the formal request for an exemption is submitted to the provincial government.