Changes to HRM short term rentals (STRs) effective Sept. 1st

Short Terms Rentals in the Halifax Regional Municipality

In recent years, the presence of short-term rentals, often run through AirBnB, Vrbo, etc., has increased across the province. Short-term rentals (STRs) can be useful for travelers and profitable for property owners but concerns on the part of neighbours and legislators have lead to recent changes to provincial and municipal laws regarding the operation of STRs.

Registration

The Tourist Accommodation Registration Act requires that everyone who operates an STR for 28-days in a row or less register with the province of Nova Scotia. Registration fees for hosts range from $50-$150 depending on the number of bedrooms. Registrations need to be renewed every year by April 1^st. Renewal fees are the same as initial registration costs.

Registering provides you with a registration number, which is required to book through STR platforms and participate in provincial tourism programs or marketing. Registration numbers cannot be transferred. Any tourist accommodation that is sold to a new person would require a new registration to continue operating.

Failure to comply with these rules can result in a fine of up to $1,000 for each day the offence occurs or continues, to a maximum of $7,500.

On April 4, 2023, the Halifax Regional Council passed by-law R-400 Respecting Registration of Residential Rental Properties, which requires operators of all rental properties, including STRs, to register with the municipality by April 1, 2024. Currently there is no plan to charge for registration and no need to renew after the initial registration. You would need to provide some basic information to the municipality to register, and you would be required to create a maintenance plan for the property that listed everything captured by by-law M-200 Respecting Standards for Residential Occupancies. Properties would also be subject to potential inspections by a fire or building inspector.

Failure to comply with this by-law carries of penalty of $150 to $10,000, for each day the offence occurs or continues, to a maximum of $10,000.

Restrictions

Beginning September 1^st, 2023, STRs in residentially zoned areas of the HRM will be subject to certain restrictions. Hosts will not longer be able to operate an STR in a residentially zoned area unless it is their primary residence. This goes for entire home rentals and renting out individual bedrooms in a home. If your entire home is rented out, you are required to meet parking requirements for a dwelling (typically one space). If you are renting out individual bedrooms, you must have one additional off-street parking spot for each bedroom. In most areas, you cannot rent out more than 3 bedrooms at a time. Failure to comply with these by-laws could lead to penalties or prosecution by the municipality.

Be Aware

Something you should consider when thinking about whether to operate an STR is HST. In Canada, the sale of a property is subject to HST by default. Practically speaking, most residential properties are exempt. Using a property as an STR could eliminate that exemption, meaning HST would have to be paid on the future sale of the property.

Have questions? Unsure how this affects your plans for your property? Reach out to Patterson Law and we would be happy to discuss your specific situation.