Short-term vacation rentals can be both beneficial and harmful to Qualicum Beach’s regular accommodations businesses and housing markets.
That’s the conclusion of a study commissioned by the Parksville Qualicum Beach Tourism Association (PQBTA).
Blain Sepos, executive director of the PQBTA, and consultant Eric Swanson of Third Space Planning presented a report to Qualicum Beach council at its regular meeting on Feb. 28.
Swanson provided highlights of the study, was based on 2022 statistics and data. He refers to short-term rentals (STRs) as residential dwelling units used for temporary guest accommodations.
“These are different from traditional bed and breakfasts because often the entire dwelling unit is rented out, not just a bedroom,” Swanson explained. “And the operators often are not on site.”
Determining the number of short-term rentals operating in the town is a tricky process said Swanson, as most of them are constantly switching on and off. And because they’re still waiting for the B.C. government to finalize its commitment on data sharing regulations and registry, information must be scraped by third parties.
“These complications mean there is no single number we can give you and how many short-term rentals are in Qualicum Beach,” Swanson told council.
The peak period when owners switch on their short-term rental units is during the summer time and it ebbs during winter and shoulder season when units are delisted.
Qualicum Beach has 150 licensed hotels, motels, inns and some bed and breakfasts. At some point during the year in 2022, roughly a maximum of 106 to 117 short-term rentals were active and their aggregate availability is equivalent to 61 full-time hotel units.
There were 36 to 41 non-principal residence short-term rentals in 2022. These are units where no one was residing in them.
Swanson informed council short-term rentals in Qualicum Beach have grown from 2019 to 2023. The unit types being used are single detached homes (22 per cent), followed by garden suites at 19.7 per cent, secondary suites at 14.5 per cent, condos at 11.8 per cent, suites in multi-listing homes at 10.5 per cent, apartment hotels at 9.2 per cent, bunkhouse/bunk suites at 9.2 per cent and ‘others’ at 2.6 per cent.
“Approximately 90 per cent of these units are being rented as entire home listings i.e the operator is not present during the stay,” Swanson explained.
Swanson pointed out the Town of Qualicum Beach has zero rental vacancy rate and that one in five residential households (19.4 per cent) are in some form of housing need. The average cost of a single family home was 156 per cent higher in 2022 compared to 2012. The average rent cost also went up 31 per cent in 2021 census at $1,435 than in 2016.
There are positive and negative impacts of short term rentals in the Town of Qualicum Beach.
“Whether any given impact is a benefit or harm … sometimes it depends on one’s perspective,” said Swanson. “For example, the 156 per cent increase in home prices might be very beneficial to some long-term homeowners and very harmful to first-time home buyers and renters.”
STRs, Swanson said, contribute to the town’s accommodation market especially during peak season, around 23 per cent, supplementing the traditional full-time fixed roof units. They raising the annual demand by 33 per cent and 39 per cent of the peak summer demands, generating around 40 per cent of annual tourism revenue.
The negative impact of STRs, said Swanson, is they become both direct competition to traditional providers especially during the low and shoulder seasons and by decreasing the availability and affordability of staff housing.
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If there were no STRs in 2022, Swanson said, there would have been a shortage of around 40 fixed-roof units and made it difficult to accommodate a year-round demand.
In 2022, Qualicum Beach lost six to seven per cent of its existing rental housing stock, or 36 to 41 units to STRs.
“Academic studies have shown that rental households, in the Parksville Qualicum Beach corridor specifically, had paid accumulative total of $15.6 million in rent, between 2016 and 2021 as the direct result of commercial short-term rental activity,” said Swanson, who added that between 2021 and 2022 rents increased by around $400 per year.
Swanson said the amount of Municipal & Regional District Tax collected from STRs operators in 2022, around $36,000, pales in comparison to the market wide decreases and affordability.
The province has legislated new laws on STRs that include principal residence restrictions province-wide. It would allow homes with full-time onsite residents (doesn’t have to be the operator), onsite operator to rent out any unit on the lot or place of residence, or allow only specific suite or dwelling units can be used for STRs.
Swanson said it’s up to the town to chose the option they believe would be suitable to the community’s needs or priorities.
