Non-resident buyers snap up Vancouver homes to run illegal Airbnb hotels despite tax

By Amy Chen

Non-resident buyers are still snapping up homes in Vancouver to turn them into illegal short term rental hotels on Airbnb and other platforms despite the 15% foreign buyer tax imposed last year, an analysis of short term rental listings show.

In one instance, the Colorado couple Lawrence J. Fluss and Deborah L. Fluss bought the three-bedroom home at 2624 W 3rd Ave for $2.3 million in December 2016^[1]https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDAwMDdQQg== and are now offering it on Airbnb for $599 per night^[2]http://archive.is/g72Kh.

ThinkPol found that the property was previously offered for legal long term rent for $2,500 per month.

The Airbnb listing is managed by an individual named Sasha Fluss, a self-described house flipper from Colorado^[3]http://archive.is/Xp6Ea#selection-929.43-929.56.

Airbnb and other short term rentals are illegal under City of Vancouver bylaws unless operated with a Bed and Breakfast licence^[4]http://vancouver.ca/doing-business/short-term-rentals.aspx, but there was no record of the property being licensed as a B&B.

Studies have shown that Airbnb is exacerbating the housing crisis in Vancouver buy taking homes out of the city’s ever shrinking rental pool.

“In light of Vancouver’s chronically low vacancy rate, the percentage of renters who are currently stretching to afford their housing, the costs and time involved in constructing new rental housing, the financial incentives built-in to short-term rentals and the competition for housing that Airbnb sets up between tenants and tourists, it seems clear that the number of housing units being used for short-term tourist purposes poses an obstacle to city achieving its ambitious goals of ensuring that people of all incomes, ages, abilities and family types can find housing near where they work, or in the areas where they have set down roots and built social connections,” research by Simon Fraser University’s Karen Sawatzky concluded^[5]http://summit.sfu.ca/item/16841
.

ThinkPol’s findings add credence to what housing advocates have long claimed: 15% foreign buyer tax insufficient to dissuade international speculation in Vancouver’s housing market.

“15% is chump change for international investors,” Affordable Housing Canada said in statement. “Christy Clark’s BC Liberals knew very well that the foreign millionaires would chalk it up as cost of doing business.”

Meanwhile, a Vancouver Sun investigation earlier this year found that the City of Vancouver has done little to crackdown on Airbnb and other illegal short term rentals, conducting only three site visits in a year despite receiving hundreds of tips^[6]http://vancouversun.com/news/local-news/vancouver-has-done-little-to-crack-down-on-short-term-rentals-documents-show.

Housing advocates are urging Mayor Gregor Robertson to take decisive action to shut down illegal short term rentals.

“Airbnb is illegal and making Vancouverites homeless,” AHC added in its statement. “Mayor Gregor Robertson has admitted that ‘short-term rentals have gobbled up a lot of the long-term rental supply’ but refuses to fix the problem.”

“If Mayor Robertson wants to convince us that he’s not deeply indebted to his developer donors – developers, who greatly benefit from Airbnb jacking up property prices and rents in the city – he needs to start enforcing the bylaws that make Airbnb illegal in the city and shut down short term rentals and return homes back to the rental stock,” AHC added.

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