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

What are Short-Term Rental (Airbnb, VRBO) Regulations in Parksville, Canada?

Parksville, a popular tourist destination on Vancouver Island in British Columbia, Canada, has been grappling with how to regulate the growing short-term rental market in recent years. Like many cities, Parksville aims to balance supporting the tourism economy while ensuring an adequate supply of long-term housing for residents. Here's an overview of the current short-term rental regulations in Parksville.

Starting a Short-Term Rental Business in Parksville

As of May 1, 2024, new provincial rules will restrict short-term rentals in Parksville to the operator's principal residence, plus one secondary suite or accessory dwelling unit like a laneway house. This is part of B.C.'s efforts to return more housing to the long-term rental market in communities with populations over 10,000.

However, Parksville's city council has advocated for exemptions to these rules for properties in certain tourism-focused zones, particularly the approximately 400 units along the popular Resort Drive area near Rathtrevor Beach Provincial Park. These properties, ranging from cabins and cottages to strata hotels, were purpose-built for tourist accommodations starting over 20 years ago.

In March 2024, the province announced that "strata hotels" and "strata motels" - individually owned strata lots operating like hotels - will likely be exempt from the principal residence requirement if they meet certain criteria, such as having an on-site front desk and housekeeping services. This was welcome news for many Resort Drive owners and businesses who had been concerned the new rules would severely impact Parksville's tourism economy.

To qualify for a short-term rental business license in Parksville, properties must have the appropriate zoning, such as:

• Resort Lands
• Tourist Commercial
• Mixed Use (Tourist Commercial)
• Downtown Waterfront
• Restricted Recreation

Operators will also need to register with the province's short-term rental registry and potentially the city. While the regulations continue to evolve, it's clear Parksville is striving to find a balance that supports both the tourism industry and local housing needs. Prospective STR operators should carefully review the latest provincial and municipal rules and consult with local authorities before starting a short-term rental business.

Short-Term Rental Licensing Requirements in Parksville

To operate a short-term rental in Parksville, property owners must obtain a business license from the City of Parksville. The licensing process ensures STRs meet safety standards and comply with local regulations. Here are the key requirements based on information from the City of Parksville's official website:

1. Zoning Compliance: The property must be located in a zone that allows for short-term rentals, such as Resort Lands, Tourist Commercial, Mixed Use (Tourist Commercial), Downtown Waterfront, or Restricted Recreation.
2. Principal Residence Requirement: As of May 1, 2024, provincial rules limit STRs to the operator's principal residence plus one secondary suite or accessory dwelling unit on the same property. Some properties, like strata hotels on Resort Drive, may be exempt if they meet certain criteria.
3. Occupancy Limits: The maximum number of guests allowed in an STR is 2 per bedroom plus an additional 2 guests. For example, a 2-bedroom unit can accommodate up to 6 guests.
4. Parking: At least one on-site parking space must be provided for each STR unit.
5. Safety Requirements: STRs must have working smoke alarms, carbon monoxide detectors, and fire extinguishers. Emergency contact information and an evacuation plan must be prominently displayed in the unit.
6. Insurance: Operators must have appropriate insurance coverage for their STR business.
7. Good Neighbor Agreement: STR operators must sign a Good Neighbor Agreement, committing to minimize impacts on neighboring properties and respond promptly to any complaints.

To apply for a short-term rental business license, submit the following to the City of Parksville's Community Planning and Building Department:

1. Completed Business License Application Form
2. Proof of principal residence (e.g., driver's license, utility bill)
3. Site plan showing parking
4. Floor plan with room dimensions
5. Signed Good Neighbor Agreement
6. Application fee of $200

The licensing process typically takes 2-4 weeks from the time a complete application is submitted. The annual business license fee for STRs is $200, renewable each year.

Operating a short-term rental without a valid business license can result in fines of up to $500 per day. Repeated violations may lead to legal action and revocation of the license.

For the most up-to-date information and to begin the licensing process, contact the City of Parksville's Community Planning and Building Department:

Community Planning and Building Department
100 Jensen Avenue East
PO Box 1390
Parksville, BC V9P 2H3
Phone: 250-954-3061
Email: planning@parksville.ca

Required Documents for Parksville Short-Term Rentals

To apply for a short-term rental business license in Parksville, property owners must submit the following documents to the City of Parksville's Community Planning and Building Department:

1. Completed Business License Application Form: This form collects basic information about the property owner, the rental property, and the short-term rental business. It can be obtained from the City of Parksville's website or the Community Planning and Building Department office.
2. Proof of Principal Residence: As of May 1, 2024, provincial rules require short-term rentals to be operated out of the host's principal residence. Acceptable proof includes a driver's license, utility bill, or property tax assessment showing the owner's name and address.
3. Site Plan: A detailed site plan must be submitted showing the location of the rental unit, parking spaces, and any outdoor amenities. The plan should be drawn to scale and include dimensions.
4. Floor Plan: A floor plan of the short-term rental unit is required, including room dimensions and the location of smoke alarms, carbon monoxide detectors, and fire extinguishers. The maximum occupancy will be determined based on the floor plan.
5. Signed Good Neighbor Agreement: STR operators must sign a Good Neighbor Agreement, committing to minimizing impacts on neighboring properties, following noise and parking regulations, and responding promptly to any complaints. The agreement template is provided by the city.
6. Proof of Insurance: Operators must provide evidence of appropriate insurance coverage for their short-term rental business, typically a minimum of $2 million in liability insurance. A copy of the insurance policy or a certificate of insurance is required.
7. Strata Approval (if applicable): If the rental property is part of a strata corporation, written approval from the strata council is required confirming that short-term rentals are permitted under the strata bylaws.
8. Application Fee: A non-refundable application fee of $200 must be submitted with the short-term rental business license application.

These documents help ensure that short-term rentals in Parksville are operated safely, responsibly, and in compliance with local regulations. Failure to provide the required documentation may result in the business license application being denied.

For the most current information and to obtain the necessary forms, contact the City of Parksville's Community Planning and Building Department:

Community Planning and Building Department
100 Jensen Avenue East
PO Box 1390
Parksville, BC V9P 2H3
Phone: 250-954-3061
Email: planning@parksville.ca

Parksville Short-Term Rental Taxes

Short-term rental operators in Parksville are required to collect and remit several taxes on their rental income. Here's a breakdown of the applicable taxes:

1. Provincial Sales Tax (PST): British Columbia charges an 8% Provincial Sales Tax (PST) on all short-term room rentals, including those offered through platforms like Airbnb and VRBO. This tax applies to hotels, motels, cottages, inns, resorts, and other roofed accommodations. STR operators must register for a PST number and remit the tax quarterly.
2. Municipal and Regional District Tax (MRDT): Parksville charges a 3% Municipal and Regional District Tax (MRDT) on short-term accommodations. This tax is used to fund tourism marketing, programs, and projects in the region. STR operators must collect and remit the MRDT along with their PST filings.
3. Goods and Services Tax (GST): The federal Goods and Services Tax (GST) of 5% applies to short-term rentals in Canada. However, small suppliers with annual revenues under $30,000 are not required to register for, collect, or remit GST. STR operators above this threshold must register for a GST number and remit the tax annually or quarterly, depending on their revenue.
4. Income Tax: Income earned from short-term rentals is subject to federal and provincial income taxes. STR operators must report their rental income on their annual tax returns. The tax rate depends on the operator's total taxable income and tax bracket.

Deductions and Write-Offs

STR operators can deduct eligible expenses from their rental income to reduce their tax liability. Some common deductions include:

1. Mortgage interest (for the portion of the property used for rental)
2. Property taxes
3. Insurance
4. Utilities
5. Cleaning and maintenance costs
6. Repairs and replacements
7. Advertising and platform fees
8. Depreciation on furniture and equipment

It's important to keep accurate records of all income and expenses related to the short-term rental business. Consult with a tax professional to ensure you are claiming all eligible deductions and complying with tax regulations.

For the most current tax rates and requirements, visit the following websites:

1. BC Provincial Sales Tax: https://www2.gov.bc.ca/gov/content/taxes/sales-taxes/pst
2. Municipal and Regional District Tax: https://www.destinationbc.ca/what-we-do/funding-sources/mrdt/
3. Canada Revenue Agency (GST and Income Tax): https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses.html

British Columbia Wide Short-Term Rental Rules

In addition to Parksville's local regulations, short-term rental hosts must also comply with provincial rules set out in British Columbia's Short-Term Rental Accommodations Act. These province-wide regulations came into effect on May 1, 2024, and aim to return more short-term rental units to the long-term housing market. Here are the key provincial requirements:

1. Principal Residence Requirement: As of May 1, 2024, short-term rentals in B.C. are restricted to the operator's principal residence plus one secondary suite or accessory dwelling unit on the same property. This rule applies to communities with populations over 10,000, including Parksville, unless specifically exempted.
2. Business License Display: Effective May 1, 2024, short-term rental hosts must display a valid business license number on their listings in areas where a business license is required by the local government. Platforms must remove listings that do not comply with local business license requirements.
3. Data Sharing: Beginning in May 2024, short-term rental platforms are required to share information about listings with the province on a monthly basis to assist with bylaw enforcement. This information is confidential and will not be disclosed to the public.
4. Fines and Enforcement: The province has established a Compliance and Enforcement Unit within the Short-Term Rental Branch to ensure provincial rules are followed. As of May 1, 2024, local governments can advise non-compliant hosts and platforms to remove listings or face fines of up to $10,000.
5. Provincial Registry: By early 2025, the province expects to launch a short-term rental registry. Hosts will be required to include a valid provincial registry number in their listings, and platforms must remove listings without valid numbers.

These provincial regulations work in tandem with Parksville's local bylaws to regulate the short-term rental market. Hosts in Parksville must ensure they comply with both sets of rules to avoid fines and penalties.

For the most current information on British Columbia's short-term rental regulations, visit the province's official website:

1. Short-Term Rentals in B.C.
2. B.C.'s Short-Term Rental Legislation

Does Parksville Strictly Enforce STR Rules?

Based on discussions in online forums like BiggerPockets and Reddit, it appears that Parksville has been relatively Airbnb-friendly compared to some other cities in British Columbia, at least up until the recent changes to provincial short-term rental regulations.

Many hosts have been operating short-term rentals in Parksville's designated tourist areas like Resort Drive for years without major issues. The city's zoning allowed for purpose-built vacation rentals in certain areas, and there seemed to be a recognition of the important role short-term rentals play in Parksville's tourism-based economy.

However, with the new provincial rules coming into effect on May 1, 2024, the landscape is changing. Parksville requested exemptions for its tourist-zoned areas, and it appears the province will grant exemptions for qualifying "strata hotels" that operate like hotels. But for individually-managed properties, the rules will be much stricter, limiting short-term rentals to an operator's principal residence plus one additional unit.

It remains to be seen exactly how strictly Parksville will enforce the new rules, but indications are that the city will need to comply with the provincial regulations. Fines of up to $10,000 are possible for non-compliant listings. The province is setting up a compliance and enforcement unit, and platforms like Airbnb and Expedia will be required to share data to assist with enforcement.

Some hosts are already reporting canceled bookings and uncertainty about the future viability of operating short-term rentals under the new rules. The general consensus among hosts on forums seems to be that the days of operating multiple STR units that are not principal residences are likely coming to an end in Parksville and across BC.

So, in summary, while Parksville has historically been quite Airbnb-friendly with its tourist-focused zoning, the city will not be able to be as lenient going forward under the new provincial enforcement regime. Hosts who have been operating despite not meeting principal residence requirements will likely find it much harder to fly under the radar. The STR landscape in Parksville is definitely shifting.

How to Start a Short-Term Rental Business in Parksville

Starting a short-term rental business in Parksville requires careful planning and compliance with local regulations. Here's a step-by-step guide to help you get started:

1. Understand the Regulations: Familiarize yourself with Parksville's zoning bylaws, business license requirements, and the new provincial short-term rental rules that came into effect on May 1, 2024. Determine if your property is eligible for short-term rentals under the current regulations.

Tip: Attend local information sessions or consult with a lawyer specializing in real estate and municipal law to ensure you have a clear understanding of the rules.

2. Prepare Your Property: Ensure your rental unit is safe, clean, and well-maintained. Install necessary safety features like smoke alarms, carbon monoxide detectors, and fire extinguishers. Provide essential amenities and furnishings to create a comfortable and inviting space for guests.

Tip: Consider hiring a professional photographer to showcase your property's best features in your online listings.

3. Obtain Necessary Permits and Licenses: Apply for a business license from the City of Parksville's Community Planning and Building Department. Submit all required documents, including proof of principal residence, site plan, floor plan, and a signed Good Neighbor Agreement. Pay the applicable fees.

Tip: Start the licensing process early, as it can take several weeks to receive approval.

4. Set Up Your Business:Choose a business structure (sole proprietorship, partnership, or corporation) and register your business with the province. Open a separate bank account for your rental business and obtain appropriate insurance coverage.

Tip: Consult with an accountant or bookkeeper to set up a system for tracking income and expenses, and to ensure you're complying with tax requirements.

5. Create a Listing: Select a vacation rental platform like Airbnb or VRBO to list your property. Craft a compelling listing highlighting your property's unique features, amenities, and location. Set competitive rates based on seasonality and local market conditions.

Tip: Emphasize your property's compliance with local regulations and your commitment to being a responsible host in your listing.

6. Manage Your Bookings: Establish a system for managing reservations, guest communication, and check-in/check-out procedures. Be responsive to guest inquiries and provide clear instructions for accessing the property.

Tip: Consider using a vacation rental management software or hiring a property manager to streamline operations and provide 24/7 guest support.

7. Comply with Tax Obligations: Register for a PST number and collect the 8% Provincial Sales Tax and 3% Municipal and Regional District Tax on your bookings. If your annual revenue exceeds $30,000, register for a GST number and charge the 5% Goods and Services Tax. Report all rental income on your tax returns.

Tip: Keep detailed records of all transactions and consult with a tax professional to ensure you're meeting your tax obligations.

8. Be a Responsible Host: Follow the terms of your Good Neighbor Agreement and strive to minimize any negative impacts on the surrounding community. Regularly monitor your property's condition and promptly address any guest complaints or concerns.

Tip: Establish clear house rules and communicate expectations to guests upfront to prevent potential issues.

Starting a short-term rental business in Parksville can be rewarding, but it requires diligence and adherence to local regulations. By following these steps and prioritizing compliance and responsible hosting practices, you can build a successful and sustainable vacation rental business.

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

If you have questions about short-term rental regulations and zoning in Parksville, here are the key contacts and resources:

City of Parksville Community Planning and Building Department
100 Jensen Avenue East
PO Box 1390
Parksville, BC V9P 2H3
Phone: 250-954-3061
Email: planning@parksville.ca
Website: http://www.parksville.ca/cms.asp?wpID=41

Contact the Community Planning and Building Department for information on zoning, business licenses, building permits, and local short-term rental bylaws.

Resort Drive Advocacy Group
Website: https://saveresortdrive.com/
Email: info@saveresortdrive.com

The Resort Drive Advocacy Group represents property owners and businesses along Resort Drive who have been seeking exemptions from the new provincial short-term rental rules. Their website provides updates on their efforts and resources for affected owners.

BC Government - Short-Term Rentals
Website: https://www2.gov.bc.ca/gov/content/housing-tenancy/short-term-rentals
Phone: 1-800-663-7867 (ServiceBC)

Visit the provincial government's website for information on the new short-term rental regulations that came into effect on May 1, 2024, including the principal residence requirement and exemptions. Contact ServiceBC with questions about the provincial rules.

Online Communities

• r/britishcolumbia - Discussion forum for issues affecting British Columbia, including short-term rental regulations.
• r/Parksville - Subreddit for the City of Parksville.
• Parksville Short-Term Rental Hosts Facebook Group - Private group for short-term rental hosts to share information and support (note: not an official city resource, but can provide helpful advice based on personal experiences).

Participating in online communities can provide insights from other hosts navigating the changing regulatory landscape in Parksville and across BC.

By contacting the appropriate municipal and provincial authorities and engaging with local advocacy groups and online communities, short-term rental hosts in Parksville can stay informed about the latest regulations and zoning requirements affecting their businesses.

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

Parksville Airbnb hosts have been actively discussing the impact of new provincial short-term rental regulations on online forums like Reddit and BiggerPockets. Here are some insights from local hosts:

Reddit - r/britishcolumbia: In a thread titled "Parksville property owners seek exemption from looming B.C. short-term rental rules," hosts discussed the special zoning for vacation rentals along Resort Drive. One commenter noted, "This was a special zoning in Parksville for vacation rentals before the onset of Airbnb and VRBO. Under the zoning owners were permitted to stay there a maximum of 180 days a year -- so not only were they never intended to be principal residences -- the zoning prohibited it." The consensus seemed to be that these purpose-built tourist accommodations should be granted an exemption.

Reddit - r/Parksville: In a post about moving to Parksville, a commenter mentioned the challenges of finding long-term rentals, stating, "Parksville has historically been predominantly a retiree community, and while that has been changing somewhat as of late, it's mostly single-family homes, townhouses and condos within the city limits, so your desired property may be hard to find if not impossible unless you're willing to look at the more rural periphery." This highlights the tension between the short-term rental market and housing availability.

BiggerPockets Forum: In a thread on real estate investing for cash flow in Canada, one investor shared their challenges with the numbers not working for house-hacking or rentals in BC markets like Parksville. They noted, "In British Columbia, well, real estate investing seems impossible. With the current prices being double of those in Ottawa, we would only be able to pay the downpayment for one property (for us to live in), and there would be nothing left for investing into the rental."

Reddit - r/airbnb_hosts: While not Parksville-specific, Canadian hosts have been discussing the impact of new tax rules on the viability of their short-term rental businesses. One host commented, "As an Airbnb owner/operator, you can no longer claim business expenses in jurisdictions with regulations in place. This is pretty much all of BC." Another noted they are considering stepping back from hosting due to the hassle of dealing with municipal regulations and Airbnb.

These discussions highlight the challenges Parksville hosts are facing in light of evolving provincial and municipal short-term rental regulations. While some purpose-built vacation rentals may secure exemptions, many hosts are grappling with the impact on their ability to operate viable short-term rental businesses in the current regulatory environment. The balance between supporting tourism and ensuring housing availability remains a key point of tension.

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.