A Vancouver couple who had their short-term rental business licence suspended in October 2021 by the city continues to rent out the ground-floor suite in their single-family home for $175 per night, a licence review panel comprised of three city councillors heard Wednesday.
That evidence caused Coun. Pete Fry to question the city’s agreement with Airbnb signed in 2018 in which the online short-term stay platform agreed that its Vancouver hosts required a valid city licence number to list on the company’s site.
“I do worry that the [memorandum of understanding] that we have between Airbnb and the City of Vancouver is not being respected to the full extent,” Fry said. “So that's something I'll be taking away and asking for an update from staff.”
The case involves Ryan and Myleen MacMillan, who share a house on Inverness Street.
The city suspended the couple’s licence in October 2021 after concluding the two-bedroom ground-floor suite they were renting via Airbnb was not considered their principal residence.
The couple, which continued to list the “spacious, modern” suite as of Thursday (March 10), appealed the city’s decision, saying the entire house was their principal residence, with Ryan telling the panel he also lived in the suite.
The city’s short-term rental bylaw states that a suite cannot be rented if it is not the owners’ principal residence. The city said the MacMillans’ house was considered to have two dwelling units, divided by the suite and top floor.
Two addresses
What partly triggered the city investigation was that the single-family house also has two addresses — one on Inverness for the top floor, and one for the suite on the East 24th Avenue side; the short-term rental licence was taken out for the address on Inverness.
Ryan appeared via audio link at Wednesday's hearing and told the panel that he and his wife rented the suite as a short-term rental to supplement their income. He also explained that he and his wife were experiencing marital difficulties and that was why he lived in the suite.
Some of the bookings in the suite, he added, were shared accommodation between him and guests. Other times, when his wife was out of town, he would reside upstairs while guests occupied the suite.
“The reason behind the short-term rental for us was we've had some personal issues, and with keeping the house, this was the most flexible way to do it,” Ryan said.
“My feeling was that because I was occupying the downstairs, I felt that we could make that work to supplement income. That was the goal — it wasn't to run this commercially, make a lot of money kind of thing.”
He said he continued to post the suite on Airbnb after the city suspended his licence last October because he believed he was allowed until his case was heard by the panel, which included councillors Lisa Dominato and Rebecca Bligh.
'Difficult for us to understand'
Koji Miyaji, the city’s deputy chief licence inspector, told the panel the suite had “extremely high” booking rates between April and October 2020, totalling 171 days out of a possible 214.
“It makes it difficult for us to understand how a [79 per cent] completely booked facility is a primary residence for somebody,” said Miyaji, noting the MacMillans’ suite was fully booked in May 2020 and bookings reached 94 and 99 per cent in two other months.
“It mirrors what we consider a commercial operation, where a location is used primarily to have short-term rental bookings.”
The panel heard also heard that a total of 77 days were booked over November and December 2020 and into February 2021; the city was unable to obtain booking information for January 2021 but the suite continues to be rented this year.
Miyaji said that over the course of two days in June 2020 when Ryan was questioned about living arrangements at the house, he gave two versions — on one day, he claimed to live upstairs with his wife, on the next day he said he lived downstairs in the suite.
"In 24 hours, we had two different versions of how they lived," said Miyaji, whose statement was later refuted by Ryan, saying he didn't recall saying that and wouldn't fabricate a "bogus story."
Miyaji and city lawyer Robert LeBlanc emphasized at different times during the hearing that the city’s short-term rental bylaw was enacted in 2018 to preserve permanent rental housing stock — the “raison d’etre” of the policy, as LeBlanc phrased it.
“That was the approved use of this particular unit,” said LeBlanc of the legal suite with a kitchen and bathroom. “And if we don't have a principal residence, then we don't have long-term housing stock.”
The Canada Mortgage and Housing Corporation's annual rental market report released in February said the average two-bedroom long-term purpose-built rental unit in Metro Vancouver was renting for $1,824 per month. The vacancy rate for that type of housing was 1.2 per cent.
The vacancy rate was 0.8 per cent for a condo, with the average two-bedroom going for $2,498 per month.
Historically, Vancouver's vacancy rate has been lower than the region, and rents higher.
'Superhosts'
In his closing remarks, Fry pointed out he had logged on to the Airbnb site and could book a stay at the MacMillans’ suite in March, April and May of this year.
He noted Airbnb verified the couple as “superhosts,” a term the company uses to describe an operator who is experienced, highly rated and committed to providing great stays for guests.
“So it seems to me that it has been a successful business venture for them,” said Fry, who along with Dominato and Bligh upheld staff’s decision to suspend the MacMillans’ licence.
“That's not necessarily germane to this decision. But I am troubled when folks are operating a business in the city of Vancouver without an appropriate licence.”
Added Fry: “I appreciate that Mr. MacMillan may not have understood that a suspension of a licence meant that he had no licence and he was unable to continue doing businesses in the city of Vancouver, but that is in fact the case.”
The listing, which Vancouver Is Awesome reviewed Thursday, showed 45 reviews from guests, whose rankings gave the MacMillans an overall score of 4.9 out of five. Four of the most recent reviews were done in February 2022, including one from a person identified as Suong.
“The Airbnb in a great location — close to a lot of shops, restaurants, etc.,” Suong wrote.
“Ryan was very accommodating when we needed to check in early. The place was big and the beds were comfy! They added a nice touch with a welcome card and beverages in the fridge. Would not recommend if you’re a light sleeper as you can hear muffled conversation and footsteps from upstairs.”
'Confident in our system'
Sarah Hicks, the city’s chief licence inspector, said in an email Thursday that if the owners continue to advertise or operate a short-term rental business, they will be subject to enforcement action.
That can include fines of up to $1,000 per offence, legal orders and the case could be referred for prosecution, which the city has done 177 times since the short-term rental bylaw was enacted in 2018.
Hicks described the agreement with Airbnb as a “balanced solution focused on a partnership to achieve compliance by their hosts with our regulations.”
She said Airbnb is not required to remove any listings, but removed 2,482 unlicensed operators from their platform in one day in 2018. At the time, the purge reduced the short-term rental market in Vancouver by nearly one-third.
Hicks said the city is responsible for monitoring compliance and pursuing enforcement against operators who are not following short-term rental regulations. This includes operators who do not qualify to operate a short-term rental, and those who do not include a valid licence number in their listing.
In the MacMillans’ case, the licence number on their active listing expired in 2020.
“We know there are operators who continue to ignore our bylaws and operate in contravention, even while under investigation,” Hicks said. “While our enforcement process does take time to complete, which can include going through the court process to prosecution, it is thorough, and we are confident in our system.”
Vancouver Is Awesome contacted Airbnb's media room via email Thursday morning but had not heard back before this story was posted.
@Howellings
