Number of 'ghost hotels' in Toronto contributing to housing crisis, surging prices, critics say

Advocates say short-term rentals listed on Airbnb are showing up in some Toronto condo buildings in concerning numbers, contributing to the deterioration of local neighbourhoods and the surge in rental prices.

A new analysis of City of Toronto data by non-profit advocacy group Fairbnb Canada found that 600 short-term rentals, also known as STRs, are located within three condo buildings alone.

The group's executive director, Thorben Wieditz, says it raises concerns over whether these units are operating as "ghost hotels" without being zoned or taxed that way.

"We see homes that have been planned, approved and built as residential units being converted into hotel use, you know, at a time when it's very difficult for people to find a place that is accessible and affordable," said Wieditz. 

"Once people start buying up, leasing up housing stock to turn it into hotel units, that's when we see these issues and that's what impacts ... neighborhood cohesion, neighborhood feel, but also obviously the housing market."

While the numbers may seem like a drop in the bucket compared to the overall housing stock, Wieditz says every unit counts during a housing crisis when the city's vacancy rate is high. And with rentals becoming increasingly prevalent in local housing markets, creating new opportunities for tourists and an additional revenue stream for some homeowners — the growth has also renewed concerns about the financialization of housing. 

That's why the advocacy group is pushing for the city to look into whether property management companies or hosts in the listed buildings are inaccurately declaring their units to be primary residences in order to qualify for the city's short-term rental permit – only to convert the units into dedicated commercial rentals.

"Losing housing stock to platforms like Airbnb is a big problem, [it] contributes to housing cost increases, rent increases. It makes life more unaffordable for people who need to live and work in certain areas," Wieditz said.

The City of Toronto's open data portal, which now includes addresses and unit numbers of all registered STRs, shows the top three condos with the highest number of units are the Harbourfront ICE condos at 12 and 14 York Street with 236 units, 300 Front Street W., with 195 units and the Parade Towers at 15 and 21 Ice Boat Terr with 166 units.

Another neighbourhood Fairbnb highlights that is densely populated with STRs is Spadina-Fort York with 2,058 units – taking up about one-third of Airbnb's total inventory in Toronto.

In a statement to CBC Toronto, Airbnb spokesperson says at a time when many are facing an affordability crisis, short-term rentals provide hosts the chance to earn additional income

"Short-term rentals also bring an influx of visitors, often to areas outside the downtown core, that help bring tourism spending to businesses in every corner of the city," said Airbnb Canada policy manager Alex Howell.

"The reality is, stricter short-term rental regulations will not solve the housing crisis in the city, but what they will do is take income away from those that need it, and visitor spending away from communities."

Howell added that it is ultimately up to the city to verify listings and enforce bylaws.