Plans by the City of Victoria to regulate short-term vacation rentals are about more than collecting taxes, they鈥檙e about protecting everyone involved. The city is headed in the right direction, and other municipalities in the region should follow suit.
Renting out an apartment, condo or home is an attractive proposition for hosts and renters alike. The revenue helps the owner pay the mortgage, and the guest gets a home-like atmosphere without the higher prices and taxes that come with renting a hotel room.
Millions of travellers and property owners around the globe are involved, and it鈥檚 a rapidly growing industry. That鈥檚 why it鈥檚 imperative that the city regulate the 鈥渋nvisible hotel鈥� industry.
In B.C., an eight per cent provincial sales tax is applied on rentals by hotels, motels, cottages, inns or resorts with four or more rental units. In addition, many municipalities, including Victoria, charge a two per cent tax that is used to promote local tourism. The 200 to 300 short-term vacation rentals operating in Victoria don鈥檛 pay those taxes and don鈥檛 fall under the same regulations that govern the operation of hotels and other commercial accommodations.
Sooner or later, someone will holler: 鈥淭ax grab!鈥� and will complain that Big Brother is telling us how and where we can rent vacation accommodations.
But those taxes and restrictions are not merely measures imposed by power-hungry politicians, they serve useful purposes. The hotel industry is regulated for the health and safety of consumers. More visitors bring more traffic and the need for more services, hence the need for taxes.
When you book a hotel room, you can reasonably expect knowledgeable and trained staff, and someone on the premises at all times in the event of problems. Not so when you rent the home of a stranger.
Many people book short-term vacation accommodations through online services that collect fees and, supposedly, protect the rights of clients and customers. But that protection is spotty, at best.
Take the case of Alberta writer Brian Brennan, who booked a downtown Victoria condo last year so he and his wife could enjoy a month-long vacation here. The price was attractive 鈥� $700 a week, plus assorted fees and taxes, payable up front.
Hours before Brennan got on the plane, he received a message from the host saying a plumbing issue had flooded the apartment, and major repairs were needed. The reservation had to be cancelled. A partial refund was sent, with a promise that the balance would soon follow.
There had been no flooding. Brennan discovered the condo owner had pulled the same dodge before. He had to take the person to court to get his money back.
The other side of that coin is what can happen to property owners. A Calgary couple rented their home out for a weekend last year to someone who said four adults would be staying at the house. A party bus arrived, and the result was a trashed house, to the tune of $50,000 to $70,000.
Thousands of travellers rent other people鈥檚 homes and have positive experiences, and stories such as these are relatively rare; nevertheless, the potential for problems always looms.
As the short-term vacation-rental industry grows 鈥� which it is doing exponentially 鈥� it is necessary that governments keep pace, as Victoria is trying to do.
Without proper regulation, no one is protected.
