These short-term rental owners followed all the regulations. Now the province is changing the rules

Two Airbnb operators in British Columbiasay they were blindsided by the province's recent moves to regulate the short-term rental sector, and are asking for more leniency.

In particular, the owners say properties that are specifically zoned for short-term rentals should be exempt from incoming provincial legislation that means owners can only rent out their propertyon apps like Airbnb and VRBOif they live in the home barring certain exceptions like resort towns and laneway homes.

Len Archer, who bought a condo in a resort property called Playa del Sol in Kelowna, B.C., in 2017, says he has rented it out short-term for two months out of the yearas an Airbnb to help with his retirement fund. Herents it out long-term for the rest of the year.

Theprovince definesshort-term rentals as accommodationsrented out for a period of less than 90 consecutive days.

The Playa del Sol is zoned for short-term rentals, said Archer, who adds that he primarily rentsout his condo on long-term contracts to students and remote workers for the remaining 10 months of the year.

WATCH | Some short-term rental hosts upset by new regulations in B.C.:

B.C.'s new short-term rental legislation causing headaches, some hosts say

10 months ago

Duration 2:17

Some Airbnb hosts are upset about the province's new short-term rental regulations, which the B.C. government says are meant to help address the affordable housing crisis. The CBC's Jon Hernandez breaks down the changes.

Now, with the province's new rules over short-term rentals which apply in cities with more than 10,000 people Archer says he's likely to see a hit to his income of up to $15,000 a year. He says he'llhave tooffer the condo as a long-term rental year round"and consider if it is a viable investment going forward."

Associated Property Management, the strata management group responsible for Archer's unit, said the City of Kelownahas allowed Playa del Sol to operateas a short-term rental property and it hasbeen in contact with council about how the provincial changes will affect that.

Archer acknowledged there were situations where Airbnbwas causing a shortage of long-term rental options but he felt he did the right thing by choosing a property zoned specifically for short-term rentals, and paying for a business licence and taxes along with it.

"We are good neighbours in our complex and we've done everything ... correctly and above board," he said. "[We]feel somewhat slighted, [the province] saying, 'well now, no, you can't do that anymore.'"

It's a similar situation for Debra Sheets, a retired University of Victoria professor who bought four units in the Janion a former hotel in the provincial capitalthat was turned into an upscale micro-loft apartment building by Reliance Properties.

The development companyadvertises the ability to list the building's rooms on sites like Airbnb and VRBOin order to make money.Most units are under 400 square feet in size.

"We've got long corridors with very small micro-lofts, so it's not really designed for long-term living," Sheets said.

Jon Stovell, CEO of Vancouver-based Reliance Properties, said the hotel was "literally derelict" before the companystepped in roughly 10 years ago to start fixing it up.

As a hotel, the Janion was zoned "transient" a method the City of Victoria used to describe short-term rentals prior to 2017. Even when the zoning rules were updated to remove short-term rentals, the Janion was grandfathered in because of its historic use as a hotel.

"We kind of just inherited a transient accommodation zoning," Stovell said, adding that about half of the building's 122 units are being used as short-term rentals.

Stovell said while he understands the need to regulate short-term rentals, "it's a bit unfair" for the province to change the rules on people who have been following both provincial and municipal rules tomakeinvestments a sentiment Sheets agreed with.

"This is the type of thing you don't expect from a western democracy," she told Gloria Macarenko, host of CBC'sOn The Coast. "They wanted short-term rentals initially. Can they change their minds, like, seven years later?"

On The Coast9:38Some B.C. residents who invested in Airbnb properties are worried about proposed new law

There's concern over new legislation that involves mandating those who offer short-term accommodation to actually live on the property. An Airbnb operator who invested in multiple properties in Victoria for her retirement says she has no idea what she will do next.

Sheets saidif she is no longer able to keep the rooms as short-term rentals she will likely have to sell them at a loss, and she saidother owners in the building may be considering a class-action lawsuit against the B.C. government.

"These are small, individual owners. These are not multinational corporationslike the ones that run the hotels," she said.

The former nursing professor said the government was using short-term rental owners as scapegoats, instead of massively expanding public housing development like they did in decades past.

Move welcomed by Island mayors

Policymakers, however, are enthusedby the government's move to regulate short-term rentals, which will include a provincial registry and enforcement branch.

In a statement released by the province, Victoria Mayor Marianne Alto said she was "delighted" with the changes, saying she expects provincial regulation to help the city increase the amount of housing available.

Tofino Mayor Dan Law says municipalities were finding it difficult to crack down on rulebreakers.

On The Island10:44The B.C. government is taking steps to help municipalities regulate holiday rentals. We spoke with the mayor of Tofino about what this could mean for his community.

Gregor Craigie spoke with Dan Law, the mayor of Tofino.

Law says some people in Tofino, which draws many tourists,would buy properties in areas zoned for housingand use them for short-term rentals going against municipal regulations. He says the regulations are likely to have a big impact on the phenomenon of short-term rentals itself.

"There's certainly going to be some houses that are turned back over into long-term accommodation whether it's owned or rented," he told Gregor Craigie, host of CBC'sOn The Island.

B.C. Premier David Eby has indicated he is not sympathetic to owners who rent out multiple units on apps like Airbnb.

"The bottom line is when people own multiple condos andare renting them out as private hotels in our province when we are desperate for long-term housing for people, it's just not acceptable. So we're going to deal with it," Eby said Monday.