Hamilton politicians voted in favor of a pair of actions designed to protect the city’s housing supply.
City councilors on Wednesday approved a new tax on vacant homes to discourage speculators and hopefully open up empty homes for rent amid a housing crisis.
According to a 2022 staff report, the cost to launch the initiative will be approximately $2.6 million, including the hiring of 16 full-time staff.
According to the study, the annual costs of the program should be offset by the newly created revenues.
District 3 Com. Nrinder Nann, who has previously suggested that speculators are using vacant homes to make profit, calls the upcoming tax an “important tool”.
Hamilton Seeks Provincial Approval to Introduce Vacant Housing Tax
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“This is part of a series of policies, a series of actions that this council is taking to ensure that we address the affordable housing crisis that this municipality is facing,” Nann said.
Before seeking provincial approval for the tax, councilors also shared complaints about how some vacant properties precipitated snowy sidewalks, unmoved lawns and other issues.
The Hamilton-Burlington Association of Realtors is one organization that has opposed the tax, with its president suggesting that the additional cost would “discourage economic investment”.
Vancouver introduced an empty house tax in 2017, making it the first major city in Canada to implement such a measure, intended to crack down on foreign investment and real estate speculation. The city says the tax has reduced vacant properties by 25% since its launch.
Toronto and Ottawa have introduced their own vacancy tax in 2022, while other jurisdictions like Mississauga, Ontario are considering introducing similar taxes.
Councilors approve settlement limiting Airbnb rentals
Councilors have officially approved a settlement to regulate short-term rental properties, primarily Airbnbs.
The regulations limit short-term rentals (STR) to the primary residence of an owner with a business license to guard against the conversion of the housing stock into tourist accommodation.
It also includes a no-rental cap of more than 28 consecutive nights.
Based on pre-COVID-19 information, approximately 900 STR units are operating in Hamilton, with the highest concentration downtown.
Hamilton, Ont. restrict short-term rentals to the owner’s primary residence with a time limit
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Around 60%, or 600, of homes would be vacant at the start of 2022, with a number of entire homes rented out for use on platforms like Airbnb.
The plan stemmed from recommendations in the staff report produced through public consultations, including an online survey suggesting the adoption of a regulatory regime similar to that in place in Toronto.
City staff estimate that the cost of administering the STR licensing program will be approximately $286,000 per year.
The deadline for all STR operators (hosts) to register and receive an STR license is May 31.
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