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Vancouver is preparing to impose more restrictions on Airbnb Inc. and other short-term rental operators as Canada’s priciest housing market seeks to ease its near-zero supply of homes to let.
“We’re going to require a business license for anyone doing short-term rentals,” Vancouver Mayor Gregor Robertson said Friday in an interview at Bloomberg headquarters in New York. “We don’t want to see units taken out of the rental pool and not effectively taxed like all the rest of the hospitality industry.” He declined to specify a rate, saying it was still under discussion. In the region, short-term rentals face as much as a 3 percent tax.
Regulatory tensions remain a hurdle for a potential initial public offering for Airbnb, which was valued at $31 billion by investors this year. The nine-year-old upstart has been facing pressure from governments that blame its home-sharing website for squeezing housing supply as landlords turn apartments into ersatz hotels.
Robertson said Airbnb has been “very cooperative” in working with the city as it drafts the new rules, which are expected to be unveiled in the next few months.
That reflects a more conciliatory approach the apartment-sharing website has taken in recent months toward city regulators. After suing its hometown San Francisco in federal court last year, Airbnb reached a settlement Monday on the lawsuit requiring it to register its rental properties with the city. The company also set an automatic limit to the number of nights hosts can rent out their homes in Amsterdam and London in December.
Robertson said Vancouver studied cities that had tried to cap the number of nights per year and found “enforcement is impossible.”
The Canadian city is going with what he called a more clear-cut approach. Residents will be able to obtain a business license and rent a room in their primary residence. They won’t be allowed to rent out standalone apartments or houses — something that he said would be easier to enforce.
With some of the world’s fastest-appreciating property markets, Canadian policy makers have so far targeted the two most expensive markets of Vancouver and Toronto, where homes have seen the biggest gains.
Montreal may be next. Quebec Finance Minister Carlos Leitao said in a separate interview at Bloomberg headquarters Friday that the government was watching to see if there was a “spillover” after provincial governments imposed taxes on foreign buyers in Vancouver and Toronto.
“We’ll keep an eye on that,” he said. “We don’t exclude measures that would give us more information, like finding out who buys what.”
–With assistance from Frederic Tomesco
©2017 Bloomberg L.P.