Victoria Short-Term Rental Owners, Managers File Lawsuit Against Province

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With new legislation to curb short-term rentals about two weeks away from coming into effect, a group including hundreds of landlords is taking the province and city of Victoria to court to challenge it.

The Westcoast Association for Property rights, doing business as the Property Rights Association of BC, and by Victoria-based company Amala Rental Solutions and Angela Mason, co-owner of Amala with Ryan Sawatzky. They want a review of the legislation and to be compensated for the financial losses it will entail.

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The association is made up of about 290 people who own residential and non-residential properties throughout British Columbia. It was formed in October 2023 in reaction to the province’s announcement of its legislation to restrict short term rentals.

Amala is a property management company that provides cleaning, customer communication and other tasks for owners of approximately 100 units in central Victoria. It also operates Air Lobby, a physical location on Pandora Avenue, where guests staying in those units can store luggage and bikes or pick up keys.

The incoming legislation means that in a list of British Columbia municipalities with more severe housing challenges, short-term rentals can only be offered in a home where the host lives, or in the basement or down the street of the property where they reside .

The province has said the goal is to reduce the number of entire homes that are rented short-term and increase the number of long-term rental options.

Under the new legislation, most of the units owned and managed by the petitioners in the claim will be illegal. Since the legislation was announced, some owners of short-term rental properties in Victoria have been selling them for less than the asking price.

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Mason owns one of the approximately 100 units Amala services, so the group filed the petition under her name.

“I was chosen because I represent a sole proprietor operating legally in Victoria who was affected, as well as a brick-and-mortar business that is closing its doors. All of your people, including my partner and I, will be left without jobs and without income to support their families,” Mason said.

Amala has been in business since 2016 and last fall had a contract to manage 90 short-term rental properties and employed 11 full-time employees, 21 part-time employees and seven contractors, according to the claim. Most have been laid off and now only 15 workers remain.

Mason said he bought his condo because the City of Victoria zoned it for short-term rentals, and will cancel the business licenses it issued once the provincial legislation comes into effect.

“It was never something that could take a long-term tenant to mortgage,” Mason said. “My hopeful outcome is to allow legal operators to continue operating and shut down those operating illegally and consider a longer phase-out plan.”

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The Ministry of Housing told Postmedia: “The province’s primary residence requirement for short-term rentals will come into effect as planned in many British Columbia communities on May 1, 2024. As this is a matter before the courts “The ministry cannot comment. We will delve deeper into this.”

The City of Victoria is a housing market in which more than a third of residential properties are owned by investors, according to 2021 figures from Statistics Canada’s Canadian Housing Statistics Program, which are the latest available.

According to Andy Yan, urban planner and director of the Urban Program at Simon Fraser University, 32.3 per cent of all residential properties in the city of Victoria are owned by investors rather than owner-occupied. This means they are rented long term, rented short term or left empty. When it comes to condos, specifically, the number is higher: 38.2 percent of them are owned by investors.

“Those are really high numbers,” Yan said.

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