PoCo passes rules on short-term rentals; downtown development a question mark

Following a nearly 60 percent increase in the number of short-term rentals in the city, Port Coquitlam is trying to put those units into the long-term housing market.

Council unanimously approved the provincially-mandated short-term rental rules April 9. However, how those rules will affect a Mary Hill Road development remain up in the air.

In 2018, Port Coquitlam had 72 short-term rentals in 2018. In 2023, the city had 114 active listings, according to market researcher AirDNA.

The units, which were renting for an average of $137 a day in 2022, often tried to circumvent city regulations by including tenancy agreements, according to a city staff report.

Amid the rise of short-term rentals, the city’s vacancy rate has settled at approximately 0.4 percent, according to 2022 Metro Vancouver data. A healthy vacancy rate is generally considered to be between three and five percent.

Approximately 11 percent of Port Coquitlam renters live in purpose-built rental building, according to a city staff report. The majority live in secondary suites, accessory dwellings, or other accommodations considered secondary market rental.

The exception

The five-storey building under construction at 2388 Mary Hill Road was meant to be Port Coquitlam’s only short-term occupancy apartment, allowing visitors to stay a day or more.

Located by the Port Coquitlam Community Centre, the building was meant to accommodate visiting sports teams and other organizations using centre.

City staff and the developer are set to discuss the impact of the new legislation on that arrangement, according to a city staff report.

Surprising growth

The growth of short-term rental accommodations in smaller markets like the Tri-Cities was surprising to Tsur Somerville, professor at UBC’s Sauder School of Business when speaking to the Dispatch in 2023.

“I certainly wouldn’t want what few units (are available) used for short-term rental instead of housing people, when the vacancy rate is really low,” Somerville said.

The city deals with illegal short-term rentals based on complaints. Port Coquitlam has reported eight complaints over the past five years. City fines are capped at $1,000.

Bed and Breakfasts are the only permitted short-term rentals in Port Coquitlam. The rules allow for a maximum of two bedrooms within a home to be rented. The owner must reside in the home and parking has to be provided for the guests.

The city allows for boarding for sports billets and exchange students in all residential zones. Boarders must stay for at least 90 days.

From Victoria

In the fall of 2023, the province announced new regulations and steeper fines for property owners who host through sites like Airbnb and Expedia.

Short-term rental hosts who violate municipal bylaws could face fines as high as $3,000 per infraction per day – triple the previous maximum fine, according to the province’s technical briefing.

The legislation, which is set to be enacted May 1, received criticism from some municipalities. An elected official from Prince George described an increasing reliance on health-care and construction workers who routinely use short-term rentals while working for short stints in the community.

Legal action is pending in Victoria, where the West Coast Association for Property Rights and a business that provides hosting services for short-term rentals are seeking to have some of the new rules struck down.

Municipalities with a vacancy rate above three percent for two straight years can opt out of the new rules.