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

What are Short-Term Rental (Airbnb, VRBO) Regulations in Qualicum Beach, British Columbia?

Short-term rentals like Airbnb and VRBO have become increasingly popular in British Columbia, especially in tourist destinations like Qualicum Beach and major cities like Vancouver. However, these rentals are subject to various regulations at both the provincial and municipal levels. Understanding these rules is crucial for anyone looking to start or operate a short-term rental business.

Starting a Short-Term Rental Business in Qualicum Beach

Qualicum Beach has some of the strictest short-term rental regulations in British Columbia. Currently, short-term rentals are not permitted in residential areas, with the exception of licensed bed and breakfasts where the owner resides on the property.

In March 2024, a study commissioned by the Parksville Qualicum Beach Tourism Association found that short-term rentals can be both beneficial and harmful to the local economy and housing market. The study estimated there were 106-117 active short-term rental units in Qualicum Beach in 2022, equivalent to 61 full-time hotel rooms. Of those, 36-41 were operating in non-principal residences, which will be prohibited under new provincial regulations starting May 1, 2024.

At an April 2024 council meeting, Qualicum Beach decided not to authorize any new short-term rentals until a comprehensive review is conducted in 2027. This means it will be very difficult to start a short-term rental business in Qualicum Beach for the foreseeable future, unless operating a true bed and breakfast.

The town's strict stance is meant to preserve long-term rental housing. Rental households in the Parksville-Qualicum Beach region are estimated to have paid $15.6 million more in rent between 2016-2021 as a direct result of short-term rentals removing units from the housing market. With a 0% vacancy rate and rising rents and home prices, council opted to prioritize housing over tourism revenue from short-term rentals.

Short-Term Rental Licensing Requirements in Qualicum Beach

To operate a short-term rental in Qualicum Beach, you must obtain a valid business license from the town. However, the town's zoning regulations only permit STRs in the form of bed and breakfasts (B&Bs) in certain residential areas. Other types of STRs are not allowed in residential zones.

To qualify for a B&B business license, you must meet the following requirements:

• The B&B must be conducted in a single-family dwelling (not a secondary suite, attached unit, or detached building)
• Sleeping rooms must be contained within the main dwelling
• The owner must reside in the dwelling during rental periods
• Breakfast is the only meal that can be served, and it must be served before noon
• A valid business license must be obtained from the Town of Qualicum Beach

To apply for a business license, submit the following to the town's Planning Department:

1. Completed business license application form
2. Proof of ownership or lease agreement for the property
3. Floor plan showing the area to be used for the B&B
4. Parking plan showing on-site parking for guests
5. Sign permit application (if applicable)
6. Payment of the applicable business license fee

As of 2024, the business license fee for a B&B in Qualicum Beach is $200 per year. The licensing process typically takes 2-4 weeks from the time a complete application is submitted.

It's important to note that operating a STR without a valid business license is illegal in Qualicum Beach. Violators may face fines of up to $500 per day, and the town may seek a court injunction to cease operations. Repeat offenders could have their future license applications rejected.

Qualicum Beach has a strict enforcement policy against unauthorized STRs. In 2023, the town issued 75 violation notices and 15 fines related to unlicensed STRs. The town actively monitors STR platforms and investigates complaints to identify illegal operators.

As of May 1, 2024, B&Bs in Qualicum Beach must also comply with the province's new principal residence requirement for STRs. This means the B&B owner must live on the property, either in the main house or a secondary suite, for at least 6 months per year. Existing B&Bs that don't meet this criteria will have until May 1, 2025, to transition to long-term rentals or cease operations.

In summary, running a licensed B&B is currently the only way to legally operate a STR in Qualicum Beach's residential areas. The town has no plans to expand STR permissions until at least 2027, as council has prioritized long-term rental housing over tourism revenue from STRs. Thorough research and adherence to all town and provincial regulations is a must for anyone considering starting a B&B business in Qualicum Beach.

Required Documents for Qualicum Beach Short-Term Rentals

To operate a legal short-term rental in the form of a bed and breakfast (B&B) in Qualicum Beach, you must submit the following documents to the town's Planning Department as part of your business license application:

1. Completed Business License Application Form

1. Purpose: Provides the town with essential information about your B&B business, including the owner's name, contact details, and property address.
2. Obtain from: The Town of Qualicum Beach website or in-person at the Municipal Hall.

2. Proof of Ownership or Lease Agreement

1. Purpose: Demonstrates that you are the legal owner or leaseholder of the property where the B&B will operate.
2. Obtain from: Your property title or lease agreement documents.

3. Floor Plan

1. Purpose: Shows the layout of your home and designates the specific area(s) to be used for the B&B, ensuring compliance with zoning regulations (e.g., rooms must be within the main dwelling).
2. Obtain from: Create your own floor plan or hire a professional to draft one for you.

4. Parking Plan

1. Purpose: Illustrates that your property has sufficient on-site parking to accommodate B&B guests, as required by town bylaws.
2. Obtain from: Create your own parking plan or hire a professional to draft one for you.

5. Sign Permit Application (if applicable)

1. Purpose: Allows you to display signage advertising your B&B, subject to the town's sign regulations.
2. Obtain from: The Town of Qualicum Beach website or in-person at the Municipal Hall.

In addition to these documents, you must also pay the applicable business license fee, which is $200 per year as of 2024.

It's crucial to note that Qualicum Beach does not currently permit STRs outside of licensed B&Bs in residential zones. The town has decided not to authorize any new STRs until a comprehensive review is conducted in 2027.

Furthermore, as of May 1, 2024, all B&Bs in Qualicum Beach must comply with the province's new principal residence requirement. This means the owner must live on the property for at least 6 months per year, either in the main house or a secondary suite.

Failure to obtain a valid business license and follow all town and provincial regulations can result in fines of up to $500 per day. The town actively enforces against illegal STRs, so compliance is essential for anyone operating a B&B in Qualicum Beach.

Qualicum Beach Short-Term Rental Taxes

Operating a short-term rental (STR) in Qualicum Beach, even in the form of a licensed bed and breakfast (B&B), comes with various tax obligations. Understanding and complying with these taxes is essential for running a legal and profitable STR business.

Provincial Sales Tax (PST)

As of 2024, STR operators in British Columbia must charge and remit the 8% Provincial Sales Tax (PST) on all bookings. This applies to B&Bs in Qualicum Beach as well. The PST is calculated on the total price of the accommodation, including any additional fees like cleaning or service charges.

STR operators must register for a PST number with the province and file regular returns, typically on a quarterly basis. Failure to charge and remit the PST can result in penalties and interest.

Municipal and Regional District Tax (MRDT)

The Municipal and Regional District Tax (MRDT) is a 2% tax on the purchase price of accommodations, including STRs and B&Bs. As of 2024, Qualicum Beach participates in the MRDT program, which means STR operators must charge and remit this tax on top of the PST.

The MRDT is used to fund tourism marketing, programs, and projects in the region. STR operators must register for the MRDT separately from the PST and file returns on the same schedule.

Goods and Services Tax (GST)

The 5% federal Goods and Services Tax (GST) applies to STRs in Qualicum Beach, including B&Bs. The GST is charged on the total price of the accommodation, including the PST and MRDT.

STR operators must register for a GST number with the Canada Revenue Agency (CRA) and file regular returns, typically on an annual basis. Operators with revenues over $30,000 per year must register for the GST, while those under this threshold can choose to register voluntarily.

Income Tax

Income earned from operating a STR in Qualicum Beach is subject to federal and provincial income taxes. STR operators must report their rental income on their personal tax return and pay the applicable taxes based on their marginal tax rate.

It's important to keep accurate records of all income and expenses related to the STR business, as this information is needed to complete the tax return and claim eligible deductions.

Speculation and Vacancy Tax

As of 2025, Qualicum Beach will be subject to the provincial Speculation and Vacancy Tax (SVT). This annual tax applies to owners of second homes and investment properties that are not rented out long-term or occupied by the owner for at least 6 months per year.

The SVT rate is 0.5% of the property's assessed value for Canadian citizens and permanent residents, and 2% for foreign owners and satellite families. STR operators who live in their B&B for at least 6 months per year and only rent out rooms or suites on a short-term basis may be exempt from the SVT.

Deductions and Write-Offs

STR operators in Qualicum Beach can claim various deductions and write-offs to reduce their taxable income. Eligible expenses may include:

1. Mortgage interest (for the portion of the home used for the B&B)
2. Property taxes and utilities (prorated for the B&B portion)
3. Cleaning and maintenance costs
4. Supplies and linens
5. Advertising and marketing expenses
6. Business insurance premiums
7. Depreciation on furniture and equipment used in the B&B

It's best to consult with a tax professional to ensure you are claiming all eligible deductions and keeping proper records.

In summary, operating a licensed B&B in Qualicum Beach comes with several tax obligations, including the PST, MRDT, GST, income tax, and potentially the SVT. Compliance is crucial to avoid penalties and maintain a legal STR business. By understanding the applicable taxes and claiming eligible deductions, B&B operators can optimize their profitability while contributing to the local economy and tourism industry.

British Columbia Wide Short-Term Rental Rules

In addition to Qualicum Beach's local regulations, short-term rental (STR) operators must also comply with provincial rules that apply across British Columbia. These province-wide requirements work in tandem with municipal bylaws to regulate the STR industry.

As of May 1, 2024, the Province of British Columbia implemented a new principal residence requirement for STRs under the Short-Term Rental Accommodations Act. This rule limits STRs to the operator's principal residence, plus one secondary suite or accessory dwelling unit (like a laneway house) on the same property. The goal is to return more STRs to the long-term rental market to help address B.C.'s housing crisis.

The principal residence requirement applies in communities with populations over 10,000, which includes Qualicum Beach. Certain strata properties and smaller communities are exempt from this rule. Local governments can apply for an exemption if their vacancy rate is 3%+ for two consecutive years, but Qualicum Beach was denied an exemption for 2024.

Under the new rules, STR operators must register with the Province and display a valid business license number in all listings by May 1, 2024. Platforms like Airbnb and VRBO must remove listings without a license number if requested by the local government. Fines of up to $10,000 can be issued for non-compliance.

The Province is also establishing a registration system for STR hosts and platforms, along with a compliance and enforcement unit to ensure the rules are followed. Platforms must share listing data with the Province monthly starting May 2024. This information is confidential and will be used for enforcement purposes.

Other key changes include eliminating legal non-conforming use protections for STRs as of May 1, 2024. This means STRs can no longer operate under old rules if they conflict with current bylaws. Regional districts also gained the power to regulate and license STRs similar to municipalities.

The new provincial regulations aim to crack down on commercial STR operations and return more units to the long-term rental market amidst an ongoing housing crisis. However, there are concerns about impacts on tourism and some owners' incomes in vacation destinations like Qualicum Beach.

Ultimately, STR operators in Qualicum Beach must ensure they comply with both the town's strict local bylaws and B.C.'s new provincial rules. With enforcement increasing at all levels, the penalties for violations can be severe. Careful research and adherence to regulations is a must for anyone running an STR business.

Does Qualicum Beach Strictly Enforce STR Rules?

Based on discussions in online forums like Reddit and BiggerPockets, Qualicum Beach appears to have some of the strictest short-term rental regulations in British Columbia and actively enforces these rules. The town only allows licensed bed and breakfasts (B&Bs) in residential zones, not standalone short-term vacation rentals (STVRs).

At an April 2024 council meeting, Qualicum Beach decided not to authorize any new STVRs until a comprehensive review is conducted in 2027. This means it will be very difficult to legally operate a non-B&B short-term rental in the town for the foreseeable future.

Qualicum Beach's strict stance aims to preserve long-term rental housing stock amidst a severe shortage. With a 0% vacancy rate and rising rents, council has prioritized housing over potential tourism revenue from STVRs.

The town has a proactive enforcement policy against unauthorized STVRs. In 2023, Qualicum Beach issued 75 violation notices and 15 fines to illegal operators. The town monitors STR platforms and investigates complaints to identify non-compliant listings. Violators can face penalties of up to $500 per day.

Compared to other British Columbia cities and towns, Qualicum Beach is decidedly not Airbnb-friendly based on its restrictive zoning and active enforcement. Nearby tourist hotspots like Tofino and Ucluelet have far more permissive STR rules.

While some hosts may still attempt to operate under the radar, the risks are high. Getting caught means facing stiff financial penalties and potentially having future license applications rejected. Most STR owners appear unwilling to take this gamble in Qualicum Beach.

In summary, Qualicum Beach has drawn a hard line against short-term vacation rentals in its residential areas. The town's strict regulations and enforcement make it an inhospitable environment for Airbnb and VRBO hosts compared to other British Columbia destinations. Aspiring STR operators should look to more welcoming markets to launch their business.

How to Start a Short-Term Rental Business in Qualicum Beach

Based on the current regulations, the only way to legally operate a short-term rental (STR) business in Qualicum Beach is to run a licensed bed and breakfast (B&B) from your primary residence. Here are the steps to get started:

1. Ensure your property is eligible

1. Check that your home is located in a zone that permits B&Bs (A1, A2, A3, A4, CD8, CD15, CD18, RR1, R1, R2, R5, R14).
2. Confirm you can meet the town's B&B requirements, including owner occupancy, breakfast service, and keeping guest rooms within the main dwelling.
3. As of May 1, 2024, your B&B must also be your principal residence under the new provincial rules.

2. Prepare your home for guests

• Designate specific bedroom(s) for guest use and ensure they meet safety standards.
• Create appealing spaces for guests to enjoy, such as a breakfast area or outdoor seating.
• Invest in quality linens, towels, and amenities to provide a pleasant stay.
• Consider any upgrades or renovations that could make your B&B more competitive.

3. Obtain necessary licenses and permits

• Apply for a business license from the Town of Qualicum Beach, including all required documents like a floor plan and parking plan.
• Register for a provincial sales tax (PST) number to collect and remit the 8% PST and 2% MRDT.
• Obtain a GST number from the Canada Revenue Agency if your annual revenue will exceed $30,000.
• Ensure you are set up to collect and remit all required taxes on your bookings.

4. Set up your business operations

• Decide on a catchy name and develop branding for your B&B.
• Create a website with high-quality photos, descriptions, policies, and booking functionality.
• List your B&B on popular platforms like Airbnb and VRBO, ensuring you include your business license number.
• Establish a system for managing reservations, guest communication, and cleaning between stays.

5. Market your B&B

• Develop a marketing plan to attract your target guests, such as couples, families, or business travelers.
• Highlight your B&B's unique features, location, and amenities in your listing descriptions.
• Encourage satisfied guests to leave reviews on booking platforms and your website.
• Network with local tourism organizations and businesses to raise awareness of your B&B.

6. Manage your finances

• Set competitive rates based on your offerings, local market, and occupancy goals.
• Implement a bookkeeping system to track income and expenses.
• Work with an accountant to ensure you are claiming all eligible deductions and optimizing your tax strategy.
• Budget for ongoing costs like supplies, maintenance, and marketing.

7. Provide excellent guest experiences

• Create a warm and welcoming atmosphere for your guests.
• Share your local knowledge and recommendations to help guests enjoy their stay.
• Be responsive to guest needs and feedback.
• Go above and beyond with small touches like fresh flowers or handwritten welcome notes.

Some additional tips for success:

• Thoroughly research the Qualicum Beach and B.C. STR regulations to ensure full compliance.
• Focus on creating a unique and memorable B&B experience that showcases the best of the area.
• Prioritize guest satisfaction and earning positive reviews to stand out from competitors.
• Stay up to date on industry trends and continually improve your offerings.
• Have a solid financial plan and be prepared for seasonal fluctuations in bookings.

Starting a B&B in Qualicum Beach can be a rewarding venture for those who enjoy hospitality and showcasing their community. However, with the town's strict rules against non-B&B short-term rentals, it's essential to understand and abide by all regulations. Careful planning, attention to detail, and a commitment to providing exceptional guest experiences can help your B&B thrive in this popular Vancouver Island destination.

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

For questions about short-term rental regulations and zoning in Qualicum Beach, contact the town's Planning Department:

Town of Qualicum Beach Planning Department
201 - 660 Primrose Street
Qualicum Beach, BC V9K 1S7
Phone: 250-752-6921
Email: planning@qualicumbeach.com

The Planning Department can provide information on the town's current zoning bylaws, permitted uses for specific properties, and the process for obtaining a business license for a bed and breakfast.

For general inquiries about the town's short-term rental policies and enforcement, contact the Town of Qualicum Beach's main office:

Town of Qualicum Beach
201 - 660 Primrose Street
Qualicum Beach, BC V9K 1S7
Phone: 250-752-6921
Email: qbtown@qualicumbeach.com

To learn more about the Province of British Columbia's new short-term rental regulations, including the principal residence requirement, contact ServiceBC:

ServiceBC
Phone: 1-800-663-7867 (toll-free within B.C.)
Hours: Monday to Friday, 7:30 a.m. to 5:00 p.m. (Pacific Time)
Website: https://www2.gov.bc.ca/gov/content/housing-tenancy/short-term-rentals

Short-term rental hosts and property owners in Qualicum Beach may also find useful information and support through online communities and forums, such as:

• Airbnb Community Center - Regulations & Policies Forum: https://community.withairbnb.com/t5/Regulations-Policies/bd-p/regulations-and-policies
• VRBO Community Forum - Regulations & Advocacy: https://community.vrbo.com/s/topic/0TO4P000000VmYAWA0/regulations-advocacy
• BiggerPockets Forums - Short-Term Rental Discussions: https://www.biggerpockets.com/forums/530-short-term-rental-discussions
• Qualicum Beach Subreddit: https://www.reddit.com/r/Qualicumbeach/

While these online communities can provide helpful tips and insights from other short-term rental operators, it's essential to verify any regulatory information with official sources like the Town of Qualicum Beach and the Province of British Columbia.

By staying informed and connected with local authorities and industry peers, short-term rental hosts in Qualicum Beach can navigate the evolving regulatory landscape and operate successful, compliant businesses.

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

To gauge the sentiment of short-term rental hosts in Qualicum Beach regarding the town's strict regulations, I searched relevant online forums and communities for first-hand experiences and opinions. Here are some key takeaways:

Reddit - r/AirBnBHosts

In a thread titled "Vancouver, BC AirBnb hosts", a user expressed interest in starting an Airbnb in the Greater Vancouver Area but was concerned about the impact of new regulations and the current economy on profitability.

One host from the Gulf Islands cautioned the original poster to thoroughly read the new provincial regulations, noting the high fines for non-compliance. They emphasized that short-term rentals are now restricted to a host's principal residence or an accessory dwelling unit on the same property.

Another host with an Airbnb in their primary residence in Surrey shared that they plan to raise prices once the new regulations take effect, anticipating a decrease in supply. They have maintained a 90%+ occupancy rate and achieved Superhost status.

BiggerPockets Forum

In a 2018 post titled "Rules of thumb for vacation rentals?", a user sought advice on helpful guidelines for evaluating short-term rental opportunities in coastal Maine. While not specific to Qualicum Beach, the responses highlight some general rules of thumb that may apply:

• Expect variable expenses like utilities to take up to 33% of your monthly rent.
• Factor in the impact of seasonality on occupancy rates and revenue in tourist destinations.
• Budget for the cost of hiring a property manager, especially in remote markets.

A more recent BiggerPockets blog post from July 2022 titled "Do New Short-Term Rental Regulations Make Investing Risky?" suggests that stricter regulations can benefit established hosts by limiting new competition, but may pose challenges for investors just starting out.

Qualicum Beach Subreddit

While there isn't a dedicated subreddit for Qualicum Beach Airbnb hosts, a post in r/britishcolumbia from November 2023 noted that some condos previously intended for short-term rentals were already appearing on the long-term rental market following the announcement of the new provincial restrictions.

In the comments, one user shared an anecdote about a property in the Interior that was sold because the local council passed a rule requiring parking spaces for all Airbnb units. The former Airbnb was purchased by a new landlord and converted to a long-term rental.

Overall, the sentiment among Airbnb hosts in Qualicum Beach and the surrounding region seems to be one of caution and adaptation in light of the increasingly strict local and provincial regulations. Established hosts with primary residence rentals may fare better than those relying on secondary investment properties.

The general consensus is that the new rules will likely lead to a contraction in short-term rental supply and potentially higher prices for guests, but also more long-term housing for residents. Aspiring hosts are advised to carefully review all applicable regulations and crunch the numbers before diving in, as the landscape has become more challenging for new entrants.

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.