British Columbia's rental market crisis appears to be rooted to the lack of affordable homes, and not just because of the proliferation of short-term rentals, an expert said.
Short-term rentals, like Airbnb, are just part of the affordability crisis that has worsened after decades of underfunding housing initiatives, said Brian Clifford, policy manager at BC Non-Profit Housing Association.
"We know that short-term rentals contribute to affordability problems. I'd say that there is a lot of focus on Airbnb, but it is not the silver bullet causing the affordability crisis. It is a contributing factor. It's not the sole problem that we have," he said in a Canadian Press report.
Also read: Quebec’s short-term rental operators could be fined up to $25,000
Clifford said 21% of BC renters spend more than half of their income on rent and utilities, higher than the Canadian average of 18%.
"One in five renters is in a crisis level of spending too much on rent. It places households at risk of homelessness. If you are spending half of your income, what are you sacrificing?" he said.
Despite this, BC government's housing initiatives seem to have yet to make an impact on people needing housing, Clifford said.
"I want to say it's getting better. We don't really know as of right now, whether it is. All indications show rents are increasing. They are increasing faster than what average people are earning," he said.
Housing Minister Selina Robinson said the province has several projects under construction and new housing units will rise as early as next year.
"We had an out-of-control housing market. We really had not enough subsidized housing being built in the last couple of decades," she said.
Also read: Demand for BC's rental housing continues to accelerate
However, some experts are firm with their stance that short-term rentals are a significant threat to affordability, even with the taxes the government earns from companies like Airbnb.
"The extra amount of tax the hosts are paying and the Airbnb is collecting and passing along – there's no scenario where that tax makes up for the harmful impact of all the short-term rentals on housing availability and affordability in the province," said David Wachsmuth from the McGill University's School of Urban Planning.
Recent figures from Airbnb Canada showed that it collected $43m in provincial, municipal, and regional taxes over the past year. These will be provided to the government to fund housing and tourism initiatives.
"Even if every cent of it was immediately placed into building affordable housing for BC residents, that wouldn't begin to address, wouldn't begin to make up for the harmful impacts on the availability of housing short-term rentals are responsible for in the province," Wachsmuth said.
Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate