Grimsby, Canada Short-Term Rental Regulation: A Guide For Airbnb Hosts

Starting a Short-Term Rental Business in Grimsby

Grimsby, a town in the Niagara region of Ontario, Canada, is currently considering implementing new regulations for short-term rentals (STRs) like Airbnb and Vrbo. While STRs are not currently permitted under Grimsby's zoning bylaws, over 128 listings were found online as of December 2023.

In response, the town is exploring a licensing program that would require all STRs and bed and breakfasts to obtain an annual license. The proposed application process could include:

• Submitting a site plan showing parking
• Providing a fire safety protocol based on occupancy
• Signing declarations about the property's septic system and electrical safety
• Paying an application fee (proposed at $550 for 1 year or $650 for 2 years)

A 6-month educational period is proposed before enforcement would begin, meaning all STRs would need to be licensed by September 25, 2024, if the bylaw is passed. Fines and penalties for operating without a license are likely.

The town held open houses in March and July 2023 and a public meeting in October 2023 to gather feedback on the proposed regulations. A draft bylaw was deferred in March 2024 pending further public consultation, with roundtable meetings held in April 2024.

Key changes since the initial October 2023 proposal include removing parking plan and electrical safety certificate requirements, revising fire safety rules, and adjusting the application fees. The 180-day annual rental cap was also removed for urban areas.

To start an STR in Grimsby, potential hosts should:

1. Review the town's current zoning bylaws and track the progress of the proposed licensing program
2. Ensure their property is eligible and can meet all requirements
3. Prepare application materials like site plans, fire protocols, etc.
4. Apply for an annual STR license once the program is implemented
5. Pay all applicable fees and renew the license as required
6. Comply with all rules around parking, occupancy, safety, etc.

Hosts should also be aware of any additional bylaws around noise, property standards, etc. that may apply. Consulting with the town's planning department and connecting with local host groups can provide further guidance as the STR landscape evolves.

While the regulatory future is still uncertain, Grimsby appears to be moving towards allowing STRs with greater oversight and accountability. Prospective hosts should stay informed and be prepared to adapt their business plans as new rules take shape.

Short-Term Rental Licensing Requirement in Grimsby

Grimsby is currently in the process of developing a licensing program for short-term rentals (STRs) like Airbnb and Vrbo. While the specific requirements are still being finalized, the proposed framework would require all STRs to obtain an annual license from the town. Here are the key details based on information from the town's website and public meetings:

Eligibility: The licensing program would apply to all short-term rentals (defined as rentals of 28 days or less) as well as bed and breakfasts. Long-term rentals would not require a license. STRs would need to comply with the town's zoning bylaws and other regulations to be eligible for a license.

Application Process: Hosts would need to submit an application form along with supporting documents to the town's licensing department. The application would likely require:

1. Proof of ownership or permission from the property owner
2. Floor plans showing the layout and number of bedrooms
3. Parking plan indicating the location and number of parking spaces
4. Proof of insurance
5. Fire safety plan
6. Responsible person contact information

The town would then review the application and conduct an inspection of the property to ensure it meets all requirements. The proposed application fee is $550 for a one-year license or $650 for a two-year license.

Submission: Applications would be submitted to the town's licensing department, either in-person at the town hall or online through a portal (details to be determined). The town is aiming to have the application process set up by September 2024 if the bylaw is passed.

Timeline: The town is proposing a 6-month educational period after the bylaw is passed before enforcement would begin. This means all STRs would need to be licensed by September 25, 2024 under the current proposal. The application review and inspection process is expected to take several weeks, so hosts should apply well in advance of their planned rental start date.

Fines and Penalties: STRs found operating without a valid license could face significant penalties under the town's bylaws. While the specific fine amounts are still being determined, other municipalities like Fort Erie have implemented fines of $1,500 or more for unlicensed rentals, along with a potential prohibition on applying for a license for up to two years.

It's important to note that these licensing requirements are still in the proposal stage and may change based on further public consultation and council deliberations. The town is holding an open house on June 20, 2024, to gather additional feedback from residents and stakeholders.

STR hosts and potential operators should closely monitor the town's website and communications for updates on the licensing program. Signing up for email notifications and attending public meetings can help ensure you have the most current information.

By proactively preparing application materials and budgeting for licensing fees, hosts can position themselves to comply with the town's new STR regulations and avoid costly fines and disruptions to their rental business. Working with the town's licensing staff and participating in the public process can also help shape a fair and effective system for all parties.

Required Documents for Grimsby Short-Term Rentals

Based on the proposed licensing framework outlined on the Town of Grimsby's website and in public meetings, short-term rental hosts would need to submit the following documents as part of their license application:

1. Completed Application Form: This form, which will be available on the town's website or at the licensing department, collects basic information about the property, the owner, and the rental operation. It serves as the official request for an STR license.
2. Proof of Ownership or Permission: Hosts must demonstrate that they either own the property or have the legal right to operate an STR there. This could include a property deed, tax bill, or a signed letter from the owner granting permission to use the space for short-term rentals.
3. Floor Plans: Detailed floor plans showing the layout of the rental unit, including the number and location of bedrooms, bathrooms, and common areas. These plans help the town verify that the space meets safety and occupancy requirements. Hosts can create their own plans or hire a professional.
4. Parking Plan: A site plan or diagram indicating the number and location of parking spaces available for STR guests. This helps ensure that the property can accommodate guest vehicles without impacting neighbors or violating parking bylaws. The plan should be drawn to scale and clearly labeled.
5. Proof of Insurance: A certificate or policy document showing that the property is adequately insured for short-term rental use. The town may specify minimum coverage amounts for liability and property damage. Hosts can obtain this from their insurance provider.
6. Fire Safety Plan: A written plan outlining the fire safety measures in place at the property, including smoke and carbon monoxide detectors, fire extinguishers, and emergency evacuation routes. The plan should be based on the property's occupancy and layout and may need to be reviewed by the fire department.
7. Responsible Person Contact Information: The name, address, and 24/7 contact information for a designated person who can respond to any issues or emergencies at the rental property within a short timeframe (e.g., one hour). This could be the host themselves or a local property manager.

These documents must be submitted as part of the initial license application and may need to be updated or resubmitted upon renewal. The town's licensing staff will review the documents for completeness and accuracy before issuing a license.

Hosts can find more information and download application forms on the Town of Grimsby's short-term rentals page: https://www.grimsby.ca/en/doing-business/Short-Term-Rentals.aspx

The town's zoning bylaws, which outline the specific requirements for STRs in different areas, can be found here: https://www.grimsby.ca/en/doing-business/zoning.aspx

For questions or assistance with the application process, hosts can contact the town's licensing department at licensing@grimsby.ca or 905-945-9634.

By gathering these required documents in advance and ensuring they meet the town's standards, hosts can streamline the licensing process and demonstrate their commitment to operating a safe and compliant short-term rental. As the STR regulations are finalized in the coming months, staying informed and engaged will be key to success in Grimsby's evolving rental landscape.

Grimsby Short-Term Rental Taxes

In addition to obtaining a license, short-term rental hosts in Grimsby must also comply with various tax obligations at the federal, provincial, and municipal levels. Here is a breakdown of the key taxes that apply to STR income:

Federal Income Tax

As with any rental income, profits earned from short-term rentals are subject to federal income tax. Hosts must report their STR income on their annual tax return and pay tax at their marginal rate, which varies based on their total taxable income. For example, the federal tax rates for 2023 range from 15% on the first $53,359 of taxable income to 33% on income over $235,675.

Provincial Income Tax

Ontario also levies a provincial income tax on rental income, in addition to the federal tax. The provincial tax rates for 2023 range from 5.05% on the first $49,231 of taxable income to 13.16% on income over $552,313. Like the federal tax, the provincial tax is calculated based on the host's total taxable income from all sources.

Harmonized Sales Tax (HST)

Short-term rentals in Ontario are subject to the 13% Harmonized Sales Tax (HST), which combines the 5% federal Goods and Services Tax (GST) and the 8% provincial sales tax. Hosts must register for an HST account with the Canada Revenue Agency (CRA) and charge the 13% tax on all rental fees, cleaning fees, and other mandatory charges.

Hosts must file HST returns and remit the collected tax to the CRA on a quarterly or annual basis, depending on their revenue. Those with annual revenue over $30,000 must file quarterly, while those under $30,000 can file annually. Failure to register, charge, or remit HST can result in penalties and interest.

Municipal Accommodation Tax (MAT)

Some municipalities in Ontario, including Grimsby, are considering implementing a Municipal Accommodation Tax (MAT) on short-term rentals. The MAT is a tax of up to 4% on the rental price, which is collected by the host and remitted to the town. The revenue from the MAT is typically used to fund tourism promotion and development.

As of June 2024, Grimsby has not yet implemented an MAT for short-term rentals, but it is an option being explored as part of the town's broader STR regulation efforts. Hosts should monitor the town's website and communications for updates on any new tax requirements.

Possible Deductions and Write-Offs

While STR income is taxable, hosts can also claim various expenses and deductions to offset their tax liability. Some common deductions for short-term rentals include:

1. Mortgage interest and property taxes
2. Utilities (electricity, water, internet, etc.)
3. Cleaning and maintenance costs
4. Repairs and replacements
5. Insurance premiums
6. Advertising and platform fees (e.g., Airbnb fees)
7. Supplies and amenities for guests
8. Depreciation of furniture and equipment

Hosts should keep detailed records of all income and expenses related to their STR business and consult with a tax professional to ensure they are claiming all eligible deductions. The CRA provides guidance on rental expenses and deductions here: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/rental-income/completing-form-t776-statement-real-estate-rentals/rental-expenses-you-deduct.html

By understanding and complying with these tax obligations, short-term rental hosts in Grimsby can avoid costly penalties and ensure the long-term viability of their rental business. Staying organized, keeping accurate records, and seeking professional advice when needed can help navigate the complex world of STR taxation.

Ontario Wide Short-Term Rental Rules

While Grimsby is in the process of developing its own local regulations for short-term rentals (STRs), hosts in the town also need to be aware of provincial laws and requirements that apply across Ontario. These include:

1. Residential Tenancies Act: The Residential Tenancies Act (RTA) sets out the rights and responsibilities of landlords and tenants in Ontario. Generally, the RTA does not apply to short-term rentals of less than 28 days where the tenant does not occupy the unit as their principal residence. However, if a tenant is renting out their unit on a short-term basis without the landlord's consent, the landlord may be able to take action under the RTA.
2. Innkeepers Act: STRs may be subject to the Innkeepers Act, which governs the relationship between hosts and guests. Under this Act, hosts have certain obligations such as keeping guests' property safe and not discriminating against guests based on protected grounds. The Act also gives hosts the right to evict disruptive guests and seize their property for unpaid fees.
3. Fire Code: The Ontario Fire Code requires all STRs to have working smoke alarms, carbon monoxide detectors, and fire extinguishers. Hosts must also develop a fire safety plan and ensure all exits are clearly marked and unobstructed. Fines for non-compliance can reach $50,000 for individuals and $100,000 for corporations.
4. Building Code: STRs must comply with the Ontario Building Code, which sets out minimum standards for building safety and accessibility. Hosts may need to obtain permits for any renovations or structural changes to their rental unit to ensure it meets Code requirements.
5. Accessibility for Ontarians with Disabilities Act (AODA): The AODA requires hosts to provide accessible accommodations and customer service to guests with disabilities. This includes providing information in accessible formats, accommodating service animals, and ensuring the rental unit is barrier-free to the extent possible.
6. Consumer Protection Act: The Consumer Protection Act prohibits hosts from engaging in unfair or deceptive business practices. This includes misrepresenting the rental unit, charging hidden fees, or failing to deliver promised services. Hosts must also provide guests with a written contract setting out all terms and conditions of the rental.
7. Income Tax Act: Income earned from STRs is taxable and must be reported on the host's income tax return. Hosts can claim eligible expenses such as mortgage interest, utilities, and cleaning fees to offset their rental income. Detailed record-keeping is essential to support any deductions claimed.
8. Harmonized Sales Tax (HST): Hosts who earn more than $30,000 per year from their STR must register for and collect HST on their rental fees. The current HST rate in Ontario is 13%. Hosts must file regular HST returns and remit the tax collected to the Canada Revenue Agency.

While not exhaustive, this list highlights some of the key provincial laws and regulations that STR hosts in Grimsby need to be aware of. Failure to comply with these requirements can result in fines, legal action, and reputational damage.

Hosts should consult with a lawyer or accountant familiar with the STR industry to ensure they are meeting all their legal obligations. Industry associations like the Ontario Restaurant Hotel & Motel Association (ORHMA) and the Ontario Bed & Breakfast Association (OBBA) can also provide guidance and support.

As the STR market continues to evolve, it's crucial for hosts to stay informed about any changes to provincial regulations that may impact their operations. By prioritizing compliance and due diligence, Grimsby hosts can protect themselves and provide a safe and positive experience for their guests.

Does Grimsby Strictly Enforce Short-Term Rental Rules?

Currently, short-term rentals (STRs) like Airbnb are not permitted under Grimsby's zoning bylaws. However, enforcement appears to be limited, as over 128 STR listings were found in the town as of December 2023. This suggests that many hosts are operating despite the rules.

Compared to larger cities like Toronto or Vancouver, which have implemented strict licensing systems and proactive enforcement, Grimsby seems to be taking a more hands-off approach for now. The town is just beginning to explore the possibility of allowing STRs through a new licensing framework.

Discussions on forums like Bigger Pockets and local Facebook groups indicate that STR hosts in Grimsby are cautiously optimistic about the town's plans to potentially legalize and regulate the industry. Many seem to be operating in a gray area, hoping that the new rules will allow them to continue renting without fear of crackdowns.

One Grimsby host on Bigger Pockets wrote, "I've been renting my basement suite on Airbnb for over a year with no issues. I know it's not technically allowed, but there seems to be a 'don't ask, don't tell' attitude from the town right now. I'm hopeful the new licensing system will make things above board."

Another host in a Grimsby Facebook group shared, "I'm glad the town is finally looking at allowing STRs. It's been frustrating operating in limbo, not knowing if I could be shut down any day. I just hope the new rules aren't too restrictive or expensive."

However, some residents have expressed concerns about the proliferation of unlicensed STRs and their impact on neighborhoods. One commenter on a local news article argued, "These Airbnbs are popping up all over town with no oversight. They need to be regulated and taxed like any other business. The current free-for-all is not sustainable."

Overall, while Grimsby may not be as "Airbnb-friendly" as some vacation towns that openly embrace STRs, the reality is that a significant number of hosts are operating under the radar. The lack of strict enforcement to date has created a sense of tentative acceptance, even as the town grapples with how to formally legalize and manage the growing industry.

As Grimsby moves forward with developing its STR licensing system, hosts and residents alike will be watching closely to see how the balance is struck between welcoming tourism and protecting community character. For now, the STR market remains in a gray zone, with operators proceeding at their own risk while hoping for a path to legitimacy.

How to Start a Short-Term Rental Business in Grimsby

Starting a short-term rental (STR) business in Grimsby can be a rewarding way to earn extra income and share your space with travelers. However, it's important to approach the process carefully and comply with all relevant laws and regulations. Here are the key steps to get started:

1. Research the local regulations: Before investing time and money into setting up your STR, make sure you understand Grimsby's current zoning bylaws and the status of the proposed licensing system. As of June 2024, STRs are not technically permitted, but the town is considering a new framework to allow them with certain requirements. Stay informed about any changes or updates to the rules.
2. Assess your property's suitability: Evaluate whether your property is a good fit for an STR based on factors like location, size, amenities, and target market. Consider any necessary upgrades or renovations to make the space more appealing to guests.
3. Develop a business plan: Create a detailed plan outlining your STR's concept, target market, pricing strategy, marketing approach, and financial projections. This will help you stay organized and focused as you launch your business.
4. Obtain necessary licenses and permits: Once Grimsby's STR licensing system is in place, you'll need to apply for and obtain a valid license before operating. This will likely involve submitting an application, paying a fee, and meeting certain safety and operational requirements.
5. Set up your listing: Choose a reputable booking platform like Airbnb or Vrbo and create a compelling listing with high-quality photos, detailed descriptions, and clear house rules. Be transparent about your pricing, amenities, and any restrictions.
6. Prepare your space: Clean, declutter, and furnish your rental to create a welcoming and functional space for guests. Provide essential amenities like linens, towels, and kitchen supplies, as well as thoughtful touches like local guidebooks or welcome snacks.
7. Establish systems and processes: Develop a system for managing bookings, communicating with guests, handling check-ins and check-outs, and coordinating cleaning and maintenance. Consider using tools like automated messaging, keyless entry, and cleaning checklists to streamline operations.
8. Market your rental: In addition to listing on booking platforms, promote your STR through social media, local tourism websites, and word-of-mouth referrals. Encourage satisfied guests to leave reviews and share their experience with others.
9. Comply with tax and regulatory requirements: Understand and comply with all applicable taxes, including income tax, HST, and any future municipal accommodation tax. Keep accurate records of your income and expenses, and consult with a tax professional to optimize your deductions.
10. Provide excellent guest experiences: Prioritize guest satisfaction by providing prompt and friendly communication, clean and well-maintained accommodations, and thoughtful touches throughout their stay. Address any issues or concerns quickly and professionally.

Starting an STR business in Grimsby requires careful planning, compliance with evolving regulations, and a commitment to providing exceptional hospitality. By following these steps and continually adapting to the changing landscape, hosts can build a successful and sustainable rental operation in this charming Niagara town.

Who to Contact in Grimsby about Short-Term Rental Regulations and Zoning?

If you have questions or concerns about short-term rental regulations and zoning in Grimsby, there are several key resources and contacts available:

Town of Grimsby Planning Department: The Planning Department is responsible for administering and enforcing the town's zoning bylaws and developing the proposed short-term rental licensing system. They can provide information on current regulations, the status of the licensing proposal, and the public consultation process. Contact them by:

Phone: 905-945-9634
Email: planning@grimsby.ca
Address: 160 Livingston Avenue, Grimsby, ON L3M 0J5

Town of Grimsby Licensing and By-law Enforcement Department: This department is responsible for issuing licenses and enforcing by-laws related to short-term rentals. They can provide information on licensing requirements, application processes, and enforcement protocols once the licensing system is in place. Contact them by:

Phone: 905-945-9634
Email: licensing@grimsby.ca
Address: 160 Livingston Avenue, Grimsby, ON L3M 0J5

Grimsby Chamber of Commerce: The Chamber of Commerce represents the interests of local businesses, including short-term rental operators. They can provide guidance on best practices, industry trends, and advocacy efforts related to STR regulations. Contact them by:

Phone: 905-945-8389
Email: info@grimsbychamber.com
Website: https://www.grimsbychamber.com/

Niagara Region Short-Term Rental Association (STRNA): This newly formed association aims to represent the interests of STR operators across the Niagara region, including Grimsby. They provide a platform for hosts to connect, share information, and advocate for fair and reasonable regulations. Join their Facebook group at:

https://www.facebook.com/groups/niagarastrna/

Ontario Restaurant Hotel & Motel Association (ORHMA): ORHMA is a provincial trade association representing the interests of the hospitality industry, including short-term rentals. They provide educational resources, industry updates, and advocacy support for STR operators. Contact them by:

Phone: 905-361-0268 or 800-668-8906
Email: info@orhma.com
Website: https://www.orhma.com/

In addition to these local resources, there are also several online forums and communities where STR hosts in Grimsby and beyond can connect and share information:

1. Airbnb Community Center - Niagara Region Hosts Forum: https://community.withairbnb.com/t5/Niagara-Region-Hosts/bd-p/Niagara-Region-Hosts
2. VRBO Community Forum - Canada: https://community.vrbo.com/t5/Canada/bd-p/CA
3. Bigger Pockets - Short-Term Rental Discussions: https://www.biggerpockets.com/forums/530-short-term-rental-discussions
4. Reddit - /r/AirBnB_Hosts: https://www.reddit.com/r/AirBnB_Hosts/

By engaging with these local contacts and online communities, STR hosts in Grimsby can access the information, support, and resources they need to navigate the evolving regulatory landscape and operate successful rentals. Building positive relationships with town staff, industry partners, and fellow hosts is key to staying informed and having a voice in the policy-making process.

What Do Airbnb Hosts in Grimsby on Reddit and Bigger Pockets Think about Local Regulations?

As Grimsby considers implementing a new licensing system for short-term rentals (STRs), hosts in the town have been sharing their thoughts and experiences on various online forums. Here are some notable examples:

Reddit - /r/AirBnBHosts - "New Regulations Coming to Grimsby, ON": In this thread from February 2024, a Grimsby host posted about the town's proposed licensing system and asked for feedback from other hosts. Several local operators chimed in with their perspectives.

One host commented, "I've been operating my STR in Grimsby for 2 years without any issues, but I'm worried these new rules will make it too expensive or complicated to continue. I understand the need for some oversight, but I hope the town finds a balance that doesn't punish responsible hosts."

Another host shared, "I attended one of the town's public meetings on the proposed regulations, and I was impressed by how much they seemed to be listening to hosts' concerns. They made some changes to the original proposal based on our feedback, like removing the cap on rental nights. It gives me hope that we can find a workable solution."

Bigger Pockets - "Grimsby, ON STR Regulations - Thoughts?": In this post from November 2023, a prospective STR investor asked for insights on Grimsby's regulatory environment. Several experienced hosts weighed in with their opinions.

One host cautioned, "Grimsby is definitely cracking down on STRs. I know a few hosts who have received cease and desist letters for operating without a license. If you're thinking of investing there, make sure you do your due diligence and have a plan to comply with the new rules."

Another host offered a more optimistic take, saying, "I think Grimsby is actually taking a pretty reasonable approach compared to some other towns in the Niagara region. They're not trying to ban STRs outright, just regulate them to address community concerns. If you play by the rules and be a good neighbor, I think there's still opportunity there."

Airbnb Community Center - Niagara Region Hosts Forum: This forum has seen several discussions related to Grimsby's evolving STR regulations. In a thread titled "Grimsby Licensing Update" from April 2024, hosts shared their experiences with the town's proposed system.

One host wrote, "I just submitted my application for a license under the new system. It was a bit of a process gathering all the required documents, but the town staff were helpful in answering my questions. Fingers crossed it gets approved soon so I can start renting legally this summer!"

Another host replied, "I'm still on the fence about whether to apply for a license or just rent my place long-term instead. The fees and requirements seem pretty onerous, especially for hosts like me who only rent occasionally. I wish the town would offer a more streamlined process for small-scale operators."

Overall, the sentiment among Grimsby hosts on these forums seems to be a mix of cautious optimism and concern about the impact of the new regulations. While many recognize the need for some oversight to address community issues, they worry that overly strict rules could stifle the local STR market and hurt responsible operators.

As the town finalizes its licensing system and begins enforcement, hosts will be closely watching to see how it affects their businesses and the broader tourism economy. By staying engaged in the policy process and sharing their experiences with each other, Grimsby's STR host community hopes to find a path forward that balances the needs of all stakeholders.

Disclaimer: While we here at BNBCalc strive to keep all of our city regulation guides updated and accurate with all the latest local laws, we still do not suggest using them as your sole or primary source for local regulations. We also do not recommend you rely on the third-party sources we link to or reference, and we are not responsible for any of the information on these third-party sites. These guides are for entertainment purposes only and only provide basic information and should not be considered as legal advice.

We highly recommend directly contacting the responsible parties for each city and hearing what their officials have to say. Ultimately, it's your responsibility as an investor to ensure you fully comply with the local laws, and it's best to speak with professionals before making an investment decision.