Nancy Paine含羞草研究社檚 short-term rental business is dead in the water.

As co-founder and CEO of Victoria-based SpaceHost, Paine said she had been at the forefront of the Airbnb revolution for seven years, acting as a 含羞草研究社渓iaison含羞草研究社� for homeowners needing help with the logistics of running a listing on the accommodation site.

At the peak of business, her staff managed 65 properties, welcoming thousands of guests from around the world to what Cond茅 Nast Traveller magazine recently rated as the 含羞草研究社渂est city in the world.含羞草研究社�

含羞草研究社淚 have such great relationships with my homeowners,含羞草研究社� Paine said.

But Paine said that will all come to an end next spring when British Columbia enacts a law restricting short-term rentals to a homeowner含羞草研究社檚 principal residence. It含羞草研究社檚 among new housing regulations being rolled out over two years, with the government saying it wants to stop short-term rentals 含羞草研究社渢aking away homes people need.含羞草研究社�

含羞草研究社淚 expect business volumes to really plummet as of January and then, basically, I won含羞草研究社檛 have a business as of May 1,含羞草研究社� said Paine.

含羞草研究社淚含羞草研究社檓 planning to close my business as of May 1. It含羞草研究社檚 really sad because I含羞草研究社檝e worked really hard 含羞草研究社� I have 15 staff that I含羞草研究社檓 going to have to lay off,含羞草研究社� she added.

Short-term rental managers like Paine across B.C. are lamenting the demise of their business model, while real estate agents say owners of investment properties are being forced to sell at a loss or risk being unable to pay their mortgage.

Supporters of the policy agree about some of those impacts 含羞草研究社� the difference is they think it proves the policies are a success.

The government said the suite of reforms gives local governments stronger enforcement tools, and establish the province含羞草研究社檚 role in regulating short-term rentals. Details released Thursday said local governments could 含羞草研究社渙pt out含羞草研究社� of the principal-residence requirement annually if their community had a rental vacancy rate of three per cent or more for two consecutive years.

B.C. Minister of Housing Ravi Kahlon said in an interview on Tuesday that the number of former short-term rentals going up for sale in Vancouver, Victoria and Kelowna showed the policies were working.

He said Airbnb property managers should find new jobs.

含羞草研究社淲e know also that there含羞草研究社檚 a real shortage of property rental managers across the province 含羞草研究社� and so there are opportunities for those that are looking to stay in that field. But we need the housing for people in British Columbia.含羞草研究社�

Asked if he had compassion for owners forced to sell, or short-term rental managers going out of business, Kahlon said other people were 含羞草研究社渟truggling to find a place (to live) because of a shortage of spaces.含羞草研究社�

But Paine said that not all the housing that will be forced off Airbnb is suitable for long-term rentals.

She pointed to units in The Janion 含羞草研究社� a four-storey downtown Victoria building built in 1891 含羞草研究社� where some of her clients own units. It was given a 含羞草研究社渢ransient zoning含羞草研究社� designation ahead of the 1994 Commonwealth Games, when the city was short of space for visitors.

The building was among properties exempted from a 2017 municipal ban on short-term rentals on non-primary-residence units. City of Victoria spokeswoman Colleen Mycroft said buildings already let out short term at the time were allowed to continue operating on a 含羞草研究社渘on-conforming含羞草研究社� basis.

She said that in 2023, about 650 business licences were issued for units with 含羞草研究社渘on-conforming含羞草研究社� status and there were a total of 1,600 such units in the city.

Mycroft said the new provincial legislation will eliminate the non-conforming exception for buildings like The Janion.

But Paine said the small units in the building aren含羞草研究社檛 ideal for long-term rental.

含羞草研究社淵ou are literally opening up your bed in the living room 含羞草研究社� and then the beds flip out and is either turned up to a table or a couch,含羞草研究社� she said.

Paine said some of her clients aren含羞草研究社檛 bothering to spend about $1,500 renewing their short-term licenses in January.

She said some units are returning to the long-term market. Others will be used occasionally by owners.

Orion Rodgers, another short-term rental property manager in Victoria, manages about 30 properties. He said he also worried his business will be 含羞草研究社渆rased含羞草研究社� under the new law.

含羞草研究社淎nd all of my staff, they含羞草研究社檒l lose their jobs and I含羞草研究社檒l lose my business, which was a lawful business to operate,含羞草研究社� said Rodgers, who has seven employees.

Rodgers is also a spokesman for the Property Rights Association of B.C., a group representing about 2,500 property owners that he said was 含羞草研究社渂orn out of this legislation.含羞草研究社�

He said members are mostly middle-class, and aren含羞草研究社檛 含羞草研究社渟itting on the beach 含羞草研究社� drinking margaritas.含羞草研究社�

Rodgers said the government was using the timeline for the new legislation to 含羞草研究社渕anipulate含羞草研究社� owners into renting them out long term or put them up for sale.

含羞草研究社淧eople will face heavy losses 含羞草研究社� and the people that are going to buy them are not there. No one含羞草研究社檚 there yet because the interest rates are so high and the bar for entry to purchase is so high,含羞草研究社� said Rodgers.

The group had sent letters to Kahlon and municipalities in the hope of having their views reflected, but haven含羞草研究社檛 heard back.

In Kelowna, Amanda Van Der Lee含羞草研究社檚 company, How to Host Property Management and Design, manages properties, gives advice on interior design and provides other resources for short-term rental hosts.

She said most of her clients purchased condos in Kelowna to get into the real estate market and if forced to convert them to long-term rentals, they would have no or negative cash flow.

含羞草研究社淔or someone含羞草研究社檚 mortgage to go up $1,000 to $1,500 a month and not be able to get the amount of rental income on a monthly basis, if they go long term 含羞草研究社� it would force a sale and properties aren含羞草研究社檛 selling right now,含羞草研究社� said Van Der Lee. 含羞草研究社淭here are so many properties that are hitting the market.含羞草研究社�

Van Der Lee said owners are having their rights stripped away.

含羞草研究社淕od forbid people buy a vacation home in Kelowna and they含羞草研究社檙e able to subsidize some of the costs of that home by renting it out. Like, when did that become such a crime?含羞草研究社� asked Van Der Lee.

Tsur Somerville, associate professor with UBC含羞草研究社檚 Sauder School of Business, agreed the new rules are going to make some people suffer, but he has less compassion for investors.

含羞草研究社淵ou invested in the unit, there is risk in real estate and this was part of the risk. Nobody guaranteed an investor with the return,含羞草研究社� said Somerville.

Somerville said places including Vancouver and Toronto have raging housing crises and the notion of using a unit as a hotel instead of long-term rental housing strikes him as 含羞草研究社渧ery, very problematic.含羞草研究社�

A recent McGill University report, prepared by David Wachsmuth, a professor in the School of Urban Planning, said there was an average of 28,510 short-term rental listings active each day in B.C. in June 2023, a year-on-year increase of almost 18 per cent.

The report said short-term rentals were taking 16,810 units off the province含羞草研究社檚 long-term market, 19 per cent up on the year before.

含羞草研究社淭he COVID pandemic caused a massive decline in STR activity, but as of 2022 growth is strong across all regions of the province, and B.C.含羞草研究社檚 STR market is now at an all-time high,含羞草研究社� said the report.

含羞草研究社淚f the province含羞草研究社檚 STR market remains on its current trajectory, we expect STR-induced housing loss to increase 15.6 per cent to 19,400 by summer 2024, implying a further $23 increase in average monthly rents in medium and large cities in the province,含羞草研究社� the report continued.

Nathan Rotman, policy lead for Airbnb in Canada, said the report isn含羞草研究社檛 含羞草研究社渃redible含羞草研究社� and was paid for by the B.C. Hotel Association 含羞草研究社渨ith an interest in spreading negative information含羞草研究社� about short-term rental.

Rotman said Airbnb doesn含羞草研究社檛 oppose regulation and is willing to work with the province on implementation, but the new legislation goes 含羞草研究社渁 little bit too far含羞草研究社� and it will not 含羞草研究社渁lleviate the province含羞草研究社檚 housing crisis.含羞草研究社�

含羞草研究社淚t含羞草研究社檚 going to make travel less affordable for one million British Columbians across the province while reducing the income for some short-term rental hosts,含羞草研究社� Rotman said in an interview last week.

Wachsmuth couldn含羞草研究社檛 be reached for comment, but Andy Yan, director of the City Program at Simon Fraser University, said the report was solid and was 含羞草研究社渓eading public policy in Canada.含羞草研究社�

Yan said when the concept of short-term rental began, it was 含羞草研究社渃asual含羞草研究社� 含羞草研究社� it could be someone含羞草研究社檚 spare room or an air mattress. Then professional players entered the industry and started to distort the rental market, he said.

There have been other problems 含羞草研究社� Yan described a 含羞草研究社渉orrible含羞草研究社� case in which a man described taking over strata councils to maintain the right for Airbnb listings in certain downtown Vancouver buildings.

He said the new technology represented by Airbnb含羞草研究社檚 online platform 含羞草研究社渁ffects our economy and our housing market.含羞草研究社�

A Desjardins report released last week seems to agree. It said short-term rentals likely contributed to the housing affordability crisis in Canada.

The report said the proliferation of short-term rentals on platforms such as Airbnb and Vrbo had a significant effect on the affordability and availability of homes, reducing the number of units for long-term rentals and resale.

Kahlon said the report 含羞草研究社渃onfirms含羞草研究社� the need to 含羞草研究社渢ake action.含羞草研究社�

He said the government was now working with local governments on how to implement the new rules.

He said by later next year, the province would have a full registry of short-term rental hosts in B.C., and they would be required to ensure their data is correct.

Kahlon said owners who broke the rules would face fines of up to $3,000 per day and companies in violation would also be punished.

Paine said for now she is trying to keep her team 含羞草研究社渦pbeat and positive含羞草研究社� and they would be working throughout the holiday season.

含羞草研究社淲e含羞草研究社檙e gonna have a really fun Christmas party,含羞草研究社� said Paine.

含羞草研究社淚 told them it含羞草研究社檚 business as usual until May because I want people to still be engaged in their jobs.含羞草研究社�

EDITOR含羞草研究社橲 NOTE: An earlier version of this story incorrectly identified SpaceHost as Superhost. Our apologies for the error.

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