Airbnb may be good for tourists but at a cost to Okanagan residents
Short term rentals are forcing renters to pay hundreds to thousands of extra dollars every year, according to a report going to Penticton City Council.
The report pegs that number specifically at $332 per year more in rent because of long term rental housing being converted to short term rentals.
That number jumps to $950 a year in Kelowna and $2,060 a year in Summerland, the report says. Those are the only other Okanagan communities listed in the report.
There are 374 licenced short term rental units in Penticton, with an estimated 200 being owned by people who don’t live in them, meaning those have come out of the already tight rental pool, the report says.
The solution offered in the report is to build more rental housing rather than shut down short term rentals.
They also have an impact on traditional tourist accommodation, like hotels and motels.
“Research shows a continued trend toward this market and vacation rentals will be an important part of attracting tourists to Penticton in the future,” Blake Laven, the City of Penticton’s director of development services, said in a news release. “Short term rentals provide a unique offering highly desired by travelers, especially families, and provides accommodation offerings in areas that hotels don’t exist (such as agricultural areas).”
While they make up an estimated 13% of tourist accommodation in the city, they account for about 25% of all tourist spending in Penticton.
That accommodation share increases to about 18% in the summer months as some short term rentals are only seasonal.
There are an estimated 275 full-time short term rental units in the city versus 1,780 motel and hotel units.
“For Penticton to continue competing with other tourism destinations it must be recognized that vacation rentals are an important part of the tourist accommodation offerings and changing things too drastically could negatively impact our tourism and hospitality economy,” the report says.
It's estimated that only 60% of these units are licenced so the report says there needs to be stricter enforcement. There is some hope the province will bring in legislation this fall requiring all the rental companies, like Airbnb, FlipKey and VRBO, to only list licenced units on their sites.
The City of West Kelowna, in a May 9, 2023 report to council, said that city has only 100 licenced short term rental suites, which is a 25-35% compliance rate.
Last summer, the City of Kelowna told iNFOnews.ca that it has 887 licenced units but an estimated 545 unlicenced suites.
"I don’t know if we ever get to an accurate number for what is out there for offer," Graham March, Kelowna’s licencing and system improvement supervisor, said at the time.
READ MORE: Hundreds of Airbnb rentals not licenced in Kelowna
The City of Penticton report recommends that more research be done before any changes are made to its regulations, cautioning that under the Local Government Act, existing units would be grandfathered to the old regulations so only new applicants would have to comply to any changes.
Travel Penticton, the Penticton Chamber of Commerce and Okanagan College all told the city that the short term rental market is making it harder to attract staff and students.
“The solution would be to build additional rental housing in the community,” the report says.
The city has issued occupancy permits for more than 230 purpose built rental units in the last six months and just issued a building permit for 70 more, the report says.
On the tourism accommodation side, the report says 285 new rooms have been added to the city’s inventory in past five years while 265 have been converted to long term rentals and 103 have been demolished over the past 10 years.
In both Penticton and West Kelowna, there have been few complaints about the operation of the units and most of them have been about people operating without a licence.
Penticton staff are asking council’s support to increase enforcement and to have them look into a multi-tiered licencing system based on things like whether the owner lives on site or off site.
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