Vancouver is proposing new regulations for short-term rentals including Airbnb and Expedia that would require hosts to hold a licence and only allow them to rent out their primary residence.

The city has been mulling rules for the popular vacation-rental websites for more than a year and on Wednesday unveiled a plan that will be debated by council next week.

Mayor Gregor Robertson said Vancouver is in a rental housing crunch, with a vacancy rate that has dipped below one per cent. He estimated at least 1,000 rental units could be freed up by the new regulations.

鈥淪hort-term rentals like Airbnb have gobbled up a lot of the long-term rental supply,鈥� he said. 鈥淥ur bottom line continues to be that our housing is for homes first, and for business and investment second.鈥�

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People who rent out their units on Airbnb or similar websites would be required to hold a $49 annual licence issued by the city, and the licence details would have to be included on the rental platform advertisement.

The framework would ban short-term rentals of secondary residences but would allow home owners and renters to list and rent their principal homes, including entire units and private rooms.

In addition to the fee from operators, rental platforms such as Airbnb would have to apply a transaction fee of up to three per cent and remit that money to the city.

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Robertson said short-term rentals now make up 30 per cent of Vancouver鈥檚 accommodations for tourists and Airbnb is effectively the city鈥檚 largest hotel.

鈥淥ur focus is on ensuring that we do protect our long-term rental housing and also that we ensure that people can make supplemental income from short-term rentals,鈥� he said.

鈥淚t has become an important income source for many Vancouverites.鈥�

Currently, rentals of less than 30 days are prohibited without a hotel or bed-and-breakfast licence. Ninety-seven per cent of short-term listings are illegal, according to a staff report issued last fall.

Robertson said the new rules would legalize up to 70 per cent of existing 鈥渆ntire unit鈥� listings and virtually all 鈥減rivate room鈥� short-term rentals.

Vancouver following other cities in regulations

The city is the latest Canadian jurisdiction to grapple with the rise of Airbnb and similar websites. Quebec became the first province to impose regulations last year, including requiring users to have a permit and pay a hotel tax, while Toronto is mulling rules similar to those floated in Vancouver.

Karen Sawatzky, with Simon Fraser University鈥檚 urban studies department, has examined Airbnb鈥檚 impact on rental housing in Vancouver. She said she was pleased the city did not allow secondary suites or laneway houses to be short-term rentals.

She added that she understood that the city set the annual fee relatively low in order to encourage people to get licensed, but she didn鈥檛 think that a $49 fee would cover enforcement costs.

Sawatzky said 1,000 units being freed up for long-term rental housing would be 鈥渇antastic.鈥�

鈥淚 don鈥檛 think that鈥檚 going to happen overnight, but that would certainly be very significant, especially considering how hard it is to get new housing built in this city.鈥�

Laura Kane, The Canadian Press

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