A new McGill University study has found that regulating short-term rentals can help improve housing affordability.
In the study, researchers discovered that rents were “relatively lower” in Canadian municipalities that imposed restrictions on how and when short-term rentals could be offered by principal residences. They added that neighbouring cities that didn’t adopt restrictions also benefited.
Per the study, 309 neighbourhoods that were subject to restrictions on short-term rentals of principal residences saw monthly rent dropping by $24 on average versus the previous year when regulations weren’t present. This drop only increased in subsequent years, reaching $55 per month in regulated neighbourhoods and $40 per month in neighbouring areas without regulations. Overall, the researchers estimated that these regulations saved Canadian renters $192.4 million in monthly rent payments in 2023.
“Lots of things cause housing to be expensive, but this is low-hanging fruit to manage those costs,” said David Wachsmuth, lead researcher and associate professor in the School of Urban Planning, in a statement to McGill.
Funded by the Social Sciences and Humanities Research Council, the study looked at municipalities from 2017 to 2022, thus factoring in market changes associated with the COVID-19 pandemic.
The full study is available online.
Image credit: Shutterstock
Via: McGill University
