News / Toronto

Airbnb cutting into available rentals in Toronto, study shows

City council is expected to look next year at what, if any, regulation should be applied to the short-term rental business.

Condominiums in Liberty Village, a hot market for Airbnb rentals.

Staff / Torstar News Service Order this photo

Condominiums in Liberty Village, a hot market for Airbnb rentals.

Airbnb says its hosts are “regular people” sharing their homes with guests who get an “authentic” travel experience.

But the carefully crafted image of the short-term rental company is anything but authentic, say its critics.

The Canadian Centre for Policy Alternatives, a social justice research agency, has now added its voice to those suggesting that Airbnb is promoting a disingenuous brand.

In a study published Thursday, CCPA says the home “sharing” platform is reducing Toronto’s already constrained supply of rental housing, endangering the licensed hotel business and jeopardizing the character of some of the city’s prized neighbourhoods.

There is “a disconnect between the Airbnb narrative around ‘sharing’ that is at the heart of its advertising campaign,” says the report called, “Nobody’s Business: Airbnb in Toronto.”

Shared accommodation represents the minority of Airbnb rentals in Toronto, according to the CCPA study. There are almost twice as many listings for complete homes or condos as there are for rooms.

Airbnb maintains that its typical host rents out their primary residence.

But the CCPA report says a “small group of key players,” the 13 per cent of hosts with more than one Airbnb listing, made up 46 per cent of Toronto revenue estimates.

Houses along Cabbagetown's Bleecker Street. Residents in the area are opposed to the numerous houses popping up on the street as Airbnb rental properties.

Torstar News Service

Houses along Cabbagetown's Bleecker Street. Residents in the area are opposed to the numerous houses popping up on the street as Airbnb rental properties.

CCPA’s study relies on data collected by Tom Slee, a critic of the sharing economy. The report identifies three Airbnb “hot spots” — they include the waterfront communities, the area between Church and Yonge Sts. south of Bloor St., and Liberty Village — that, combined, represent more than a quarter of all Toronto listings. All are dense, condo-based communities close to downtown attractions and businesses.

Waterfront communities — bounded by Bathurst St., the Don Valley Parkway and Queen St. and the Toronto Islands — led Airbnb activity with 1,676 listings, 83 per cent of which were for entire homes with 35 per cent being rented by hosts with multiple properties.

“We wanted to get a statistical snapshot of what the activity is like in Toronto because when we started our line of inquiry nobody had done that,” said CCPA director Trish Hennessy, who co-wrote the report with Zohra Jamasi.

“Vacancy rates have virtually flatlined in the Liberty Village and Church-Yonge area,” the report says.

Meanwhile, it says, rental vacancies have increased by 2 per cent on the waterfront, “far less than the rise in the number of condos or units that have been built in that area.”

Virtually every downtown condo building, including those on Bay St. and University Ave., is affected by short-term rentals, said Linda Pinizzotta, founder of the Condo Owners Association.

A realtor, Pinizzotta said she has firsthand experience of the shortage of rental properties. She cited a client relocating from Texas. “I’m having a hell of a time finding it because these Airbnb people are out there trying to grab onto these properties now,” she said.

City council is expected to look next year at what, if any, regulation should be applied to the short-term rental business.

In the rush to catch up with the regulatory issues, Toronto is lagging, Hennessy said.

This month, Airbnb issued its own statistics showing that Ontario renters stay longer than traditional hotel guests: 5.4 nights, compared to 4.5 nights.

Renters in midtown and east Toronto have the longest stays, it said, averaging 7.1 nights and 6.7 nights respectively.

Airbnb would not comment on the CCAP report, which was unavailable prior to its Thursday publication. But in an emailed statement, its spokesman, Christopher Nulty, said: “The vast majority of Airbnb hosts in Toronto are regular people sharing their primary residence a few nights each month in order to make ends meet. Last year, the typical Airbnb host in Toronto made roughly $4,500 sharing their space.”

Airbnb hosts define the space they’re renting so a listing that appears as a whole residence can sometimes be a unit under the same roof.

The San Francisco-based company’s Sept. 7 report on its Ontario business said it is “engaged in productive conversations with provincial officials . . . about the need to develop fair, easy-to-follow rules that support home sharing.”

It also made the point that it contributes to the economy.

It’s not clear why Airbnb’s popularity has risen so dramatically — 288 per cent — in the past two years in Toronto, Hennessy said. It may have been in the company’s business plan or it could be that major events, such as last summer’s Pan Am Games, spurred interest in the idea.

Toronto had nearly twice the number of Airbnb listings in July as Vancouver, in part because Toronto is a bigger city and possibly because Vancouver started looking at regulation earlier on, said CCPA economist Sheila Block.

CCPA focused on Airbnb because Slee’s data was available, Hennessy said. It is also the biggest player in short-term rentals. She cited 723 Toronto listings on Flipkey and about 270 on Roomarama.