As Calgary prepares to roll out its new short-term rental (STR) regulations in December 2024, the city stands at a crossroads. These changes are designed to bring more oversight and safety to the STR market while addressing concerns from residents about housing availability and community impacts. But a critical question remains: will these measures help alleviate Calgary’s housing crisis, or will they inadvertently exacerbate it?
Public Engagement and Research
Between August and September 2024, Calgary launched an extensive public survey and collaborated with the University of Calgary to better understand the STR landscape. The research focused on community feedback, market dynamics, and the impact of STRs on long-term housing availability. This engagement highlighted key concerns, including affordability, neighborhood disruption, and housing scarcity.
The New Regulations
Key elements of the proposed regulations include:
- Proof of Consent: Hosts must obtain explicit consent from property owners or condominium boards, ensuring accountability.
- Fire Safety Compliance: Mandatory submission of detailed fire safety plans to safeguard guests.
- Mandatory Insurance: Hosts are required to carry at least $2 million in liability insurance.
- New Licensing Framework: STRs will need to adhere to stricter licensing requirements, streamlining oversight.
These changes aim to professionalize the STR industry, protect guests, and address some of the community’s concerns about unregulated properties.
The Housing Crisis: Will This Help?
Calgary, like many urban centers, is grappling with a housing crisis characterized by rising rents, limited availability, and affordability challenges. STRs have often been criticized for taking long-term rental properties off the market, exacerbating housing shortages.
- Positive Impact: By introducing stricter licensing and consent requirements, the new regulations could discourage casual or “hobbyist” hosts who convert residential housing into full-time STRs. This could potentially free up properties for long-term tenants. A similar approach in cities like Vancouver has led to modest increases in rental stock.
- Uncertain Outcomes: Critics argue that STRs represent only a fraction of Calgary’s housing market, and overly stringent regulations might disincentivize property owners from renting out homes altogether. For example, a study by the University of British Columbia found that while STR regulations in Toronto reduced STR listings, their direct impact on long-term rental availability was limited.
- A Balanced View: The regulations’ success in addressing the housing crisis will depend on enforcement and whether they incentivize property owners to reintroduce units into the long-term rental market. Without additional measures, such as increasing housing supply or incentivizing affordable housing development, these regulations alone may not significantly impact Calgary’s broader housing challenges.
A Double-Edged Sword for STR Managers and Owners
While these regulations introduce operational clarity and safety, they also increase compliance costs and barriers to entry for STR hosts. For professional STR managers, this could create an opportunity to stand out in a more regulated and competitive market. However, smaller operators may struggle to adapt, potentially leading to reduced STR availability and higher prices for visitors.
A Step in the Right Direction?
The new regulations are undoubtedly a move toward greater accountability and sustainability in Calgary’s STR market. Whether they successfully alleviate the housing crisis remains to be seen. If implemented effectively and complemented by broader housing policies, these changes could strike a balance between community needs, visitor accommodation, and housing availability.
Calgary’s experience will serve as a litmus test for other cities navigating similar challenges, making this a critical moment for policymakers, residents, and STR stakeholders alike.