Airbnb has reported that a Toronto condo building is the first in Canada to come to agreement with the short-term rental company.
The company in question is called Neptune condominiums. Other buildings within the United States have signed similar agreements. In short, the condo board on the one hand agrees to Airbnb rentals, but it also has greater control over who hosts prospective renters and the actions of those renters.
There are a number of security/control stipulations including ensuring that guests have government issued ID on file, the ability of the condo board to revoke someone’s right to short-term rentals if there are a number of complaints and ensuring that security is fully aware as to who is hosting and who is being hosted. There are also revenue sharing rules and property insurance and upkeep requirements.
Does this model threaten the temporary accommodation industry?
All Points Relocation Canada thinks it is too early to say, because we are talking about just one building here. This model will not appeal to many condo boards, so it may not proliferate. However, there is clearly a demand from those that own second properties to rent them out on short-term rather than long-term bases. Airbnb is also an aggressive company with huge resources to pull off this sort of agreement over and over again if it wants to, so temporary accommodation companies should be aware. More competition will most definitely mean pricing pressure on short-term accommodations, which technically is good for the end consumer. However, it is also a shame to see permits being given to deseperately needed apartments going for short-term rentals rather than being put onto the regular rental market. All Points Relocation Canada has written about terribly low vacancy rates in the past.
Don’t mistake the products!
All Points Relocation Service wants its readers to know that Airbnb properties rented by individuals are not the same as those rented by temporary accommodation agencies. There are many extra benefits and services and sense of security that goes with living in a temporary accommodation agency rather than going with an Airbnb private rental. I can’t do justice to all of those benefits in this article, but some of them include things that we take for granted, such as cleaning, quality of the furniture, maintenance if an appliance is not working, etc. One good improvement in this new agreement between Neptune and Airbnb is the assurance of $1 million in insurance for personal units and common areas. Before, Airbnb private rentals were a wild west when it came to whether the units were appropriate insured or not, so this is actually a big step towards competing with the temporary living industry. It shows they are growing up.
What about the recent Toronto legislation?
Unfortunately I will have to leave that to our next relo-lert, but suffice to say that the temporary living industry is under pressure from multiple directions and all of this may result in fewer players rather than more. And if there is less legitimate temporary living product on the market next summer, we will all be the worse for it.