what does that mean for condos?
By David Lu
With winter in full grip and COVID-19 still raging, the summer and the usual Ottawa tourist season seems a long way off. One initiative that the City of Ottawa announced in late 2019 was that bylaws are in the works to regulate short-term rentals like Airbnbs. The by-laws were supposed to arrive in 2020. Of course with the pandemic, this issue is likely not at the top of the City’s priority list. However, there has been a recent new development on this front.
In an article about Airbnbs and condominiums a few years ago, I wrote that a common method for condominiums to prohibit Airbnbs was to pass a rule restricting the length of time an owner could rent out their condo unit. Common restrictions we see are requirements for residential tenancies to last a minimum of 4, 6, or even 12 months. Such arrangements would still be useful once the municipal by-law comes into effect. In other words, the municipality is not expected to prohibit short-term tenancies in this way. but condominium corporations can still consider passing their own rules to achieve this, if they wish.
In November 2019, City of Ottawa staff issued a report outlining some of the steps the City might take to regulate short-term tenancies. Among several other things, the report recommended:
- A registration system for short-term rentals along with permits and fees. [Note: With respect to permits, there was a proposal that hosting permits would not be issued if a condominium corporation had registered an objection with the City.];
- A principal residence requirement that would prohibit people from renting out a unit solely as short-term rental accommodation; and
- An enforcement team that would be established for an initial period of three years to make sure people were following the rules.
It appears that the City is about to start implementing some of these recommendations. In particular, the City recently published a proposal to amend the City’s zoning by-law to temporarily regulate short-term rentals in the City for a three-year trial period.
For condominiums, the City’s key proposed provisions in relation to short-term rentals appear to be as follows:
- A short-term rental is a rental of the entire residential unit for a period less than 30 consecutive nights;
- The purpose of the rental is to provide temporary rental accommodation for the travelling public;
- A short-term rental is only permitted where the rental premises serve as the principal residence of the landlord; and
- It cannot be a bed and breakfast, hotel, cottage rental or vacation apartment.
We had hoped the City might include a provision stating that “in the case of a condominium, the short-term rental must be permitted by the governing documents of the condominium.” The City hasn’t yet included such a requirement, but perhaps, following consultation, we may see such an inclusion.
In my view, condominiums considering short-term rental restrictions or prohibitions should continue to consider amendments to their governing documents. This would be the case even once the City’s by-law on the issue comes into effect. After all, each condominium community has its own specific needs and the City’s by-law may not provide adequate clarity or protection in every situation. If your condominium is thinking about amending its governing documents to deal with short term rentals, consider consulting a lawyer on the matter as they would be best equipped to provide comments on what wording would work best in your community.
David Lu is an Associate at Davidson Houle Allen LLP, a boutique Condominium Law firm serving Eastern Ontario.