Appathy

Let’s say you buy a parking lot, hire a grumpy attendant, build a little hut for the guy, pay the property taxes, erect signage and hope to make a few bucks. Then the people living down the street sign on with the Rover app, rent out their unused driveways during the day for half your hourly rate and suck off your traffic.

They can undercut you because, to them, it’s free money. No overhead. No surly, needy ticket-puncher. No taxes. No insurance. Nada. Just a steady trickle of cash into their account. How can you compete? Nope, you can’t.

Just be happy you didn’t buy a taxi license for $200,000 five years ago because – thanks to Uber – it’s now worth 80% less. Or it could be worse. You might own a small hotel or motel with an investment in the millions, only to see your neighbours go Airbnb, taking in overnight guests, collecting the revenues, yet paying no income tax, hotel tax, HST, employee costs, suppliers or commercial property tax.

Welcome to the online, sharing economy. Shifting wealth. Shuttering businesses. The creative destruction of capital.

A top destroyer is Airbnb, which may go public later in 2019 in a blockbuster IPO (be careful). What started as a rinky-dink platform for people to rent out bedrooms is now the nemesis of the global hotel biz and a social force spreading as much evil as it does money. Governments have been slow to respond, with politicians unable to grasp the social implications.

So today literally thousands of condo units in Toronto (and Vancouver) have been bought by investors, registered with Airbnb and are rented out as virtual hotel rooms. This means they’re commercial properties, yet pay low residential taxes. They’re usually in contravention of condo bylaws, almost undetectable. The owners collect cash flows they may not report as taxable income. And all these units are neither primary residences nor on the rental market. As a result the overall housing stock is diminished, forcing prices and rents higher.

In small places, the consequences can be even more insidious. Investors buy houses for Airbnb seasonal tourist rentals, pocket the cash for four or five months of the year, then leave them dark through the fall and winter. Long-term renters are shut out. Streets are dark at night. The local drug and hardware stores wither and die. Tourist towns turn into museums. Communities decay.

In the big places, this phenom is collapsing the vacancy rate and jacking up rents. The evidence of this is overwhelming, yet governments take idiotic moves to ‘calm’ housing markets like slapping 20% levies on scant foreign buyers when it’s greedy locals causing most of the problem. Yet another report has proven the point. Airbnb, says McGill University, has removed as many as 31,000 units from the rental market in Canada – enough to halve the vacancy rate from where it would otherwise rest. And the lower that rate, of course, the higher rents become.

This 31,000 number is for entire houses or units that are frequently rented online (of the 280,000 Airbnb listings in Canada), which means they’re removed from the rental pool. Of those, 1,700 were in Vancouver alone – enough to more than double that city’s total existing vacancy rate. In Toronto there were 4,200 units, and in Montreal, 4,100.

Thus far politicians have totally misunderstood the impact. In Vancouver, while Airbnbers are supposed to obtain a license and only rent space in principal residences, enforcement is lacklustre. Compare that to the draconian blanketing of the entire city with official notices to ferret out ‘rich’ people who may own a condo they don’t occupy full-time – who are then subject to a massive, endless ‘empty houses’ tax.

In Toronto it’s a complete gong show and Airbnb free-for-all as zoning bylaw amendments to curtail short-term rentals get appealed in a languishing process. If they ever pass owners will have to register, pay an accommodation tax and only use principal residences. That would remove about 8,300 listings, 65% of which are for full houses. But so far, nothing, as the average rent for a one-bedder soars past $2,100.

So far only in Quebec is the hammer coming down. Starting this autumn Airbnb hosts will have to register with the province, inform Revenu Quebec of their income (and claim it), plus collect federal and provincial sales taxes along with a lodging tax. But the rental vacancy rate in Montreal is already twice what it is in Toronto and Vancouver, plus leases cost far less in a city where renting is no stigma. This move should make things even more affordable.

So, kids, if you want lower rents, more choice and cheaper real estate, start here. Oh, and stop inventing this crap, okay?

 

161 comments ↓

#1 binkybarnes on 06.24.19 at 4:18 pm

Don’t hold your breath waiting for our federal government to get on top of this. Oh, and first!

#2 Old Dog New Tricks on 06.24.19 at 4:23 pm

Absolutely crazy – 200k for a taxi license. I bet there is also a limit on lic lenses as well. Nada for Uber. The gig economy does have consequences. Good or bad you decide.

#3 Brian Ripley on 06.24.19 at 4:27 pm

My Household Debt chart is up now which also includes plots of GDP, Net Trade and FDI
http://www.chpc.biz/household-debt.html

Our household debt is at record levels
Our investor class is offshore
Our net trade has been negative for the last 7 quarters

And our investor class is searching for yield offshore while our neighbours play room monitor.

#4 AACI Homedog on 06.24.19 at 4:33 pm

You mean air bnb has halved the vacancy rate, I believe. It sure has damaged the rental market in my small town.

#5 Dave on 06.24.19 at 4:37 pm

In BC guys were paying close to $500,000 for a taxi license. Unbelievable? Cant wait for Uber to take over, trying to catch a cab from downtown Vancouver and go to suburbs is impossible.
Cabbies will ask you where you are headed and happily decline to drive you if it isnt as profitable to stay in downtown.

#6 Flop... on 06.24.19 at 4:42 pm

Hey North Shore Mike, I’ve got some news for you.

The house you mentioned on Hoskins Rd a while back just sold for 880k.

No bidding war.

Your time will come my friend…

M45BC

https://www.zolo.ca/north-vancouver-real-estate/4480-hoskins-road

#7 Grunt on 06.24.19 at 4:43 pm

It’s up to individual condo boards to ban Airbnb’s rentals. They’ll get smarter to it when more units get smashed by party animals. They love to toss granite counters off balconies. Doing thousands of $ damage to common areas. Do you think the student who returned early to Brunei cares who they Airbnb’s there unused rent time to?
Try going after them for compensation or getting the police involved. The insurance will get wiser to this too.

#8 FreeBird on 06.24.19 at 4:44 pm

Same problem is playing out in big european cities like Amsterdam and Venice where not only are AirBB (and HomeAway etc) units are contributing to a growing lack of housing for residents but rented out for (let’s say) non legal reasons. In these places many units are being bought up by wealthy locals/non residents for investments. We’ll see how it plays out in Canada. There’s a new group called couch surfers (vs sofa) who if agreed allow you to stay on their couch, bedroom, etc for free. Many are connected by groups like Rotary, universities, and others or just by word of mouth. From what I’ve learned while it sounds strange (even dangerous) it can work out well and provides a space for people like backpackers who need a temp place. I’m still not clear what those generous enough to offer the space get but it some cases it’s simply company. There’s also a very successful house global sitting network. I don’t think the trend is going anywhere.

#9 The Wet One on 06.24.19 at 4:47 pm

Garth,

You’re already required by law to report all your income from whatever source. Air BnB income is not exempt and requires no additional laws to require its reporting. Failing to report may well amount amount to tax evasion, a criminal act.

Second, this phrasing is confusing:

” Airbnb, says McGill University, has removed as many as 31,000 units from the rental market in Canada – enough to double the vacancy rate from where it would otherwise rest.”

Do you mean to say that the 31,000 units are enough to DOUBLE the vacancy rate from where it is? The word “otherwise” also throws off the meaning.

I’m pretty sure you mean that the 31,000 units taken out of the rental market have halved the vacancy rate and driven up long term rental lease costs, but from what you wrote (the syntax of it anyways), it’s not 100% and a bit confusing.

Good article BTW. I live next door to one of these things, and the owners are terrible. As are their guests as the place is advertised as “party friendly” which brings on all the attendant problems that one expects and doesn’t desire in a residential neighbourhood.

And the politicians are absolutely useless on this matter. It’s nice to see that Quebec is at least halfway serious at dealing with this, while the rest are all wandering with their thumbs up their bums, as usual.

So it goes…

Technology really does change everything doesn’t it?

#10 Damifino on 06.24.19 at 5:04 pm

The worst taxes are those not paid by others.

#11 Yukon Elvis on 06.24.19 at 5:06 pm

I live in Beijing. I own several condos in YVR. My family owns a travel agency. I rent the condos in YVR on a nightly or short term basis to agency clients. No Air Bnb required. I make out like a bandit. Tax that.

#12 FreeBird on 06.24.19 at 5:07 pm

Good doc film on this issue in Venice where at time of filming number of private rental units (7K) was 3x the number of hotels (15:28 in video). The issue was private home share by AirBB etc vs being an unlicensed commercial enterprise. In Venice (as in Amsterdam) local politicians are probably benefiting financially aren’t y much, if anything. Hopefully cities like Toronto will do better. There’s a similar doc on Amsterdam but couldn’t find it again.
https://youtu.be/aHNWZ018ln8

#13 PastThePeak on 06.24.19 at 5:08 pm

Lots of huge IPOs this year – over hundred billion in valuations for money losing businesses already listed, and others in the $10B+ range to come. When did I see this before…? How did that end for the market…?

Oh well, I am sure it is different this time…

#14 Stan Brooks on 06.24.19 at 5:21 pm

Disruptors will not be constrained.

Amazon was not constrained. Uber went up, as I predicted, so will AirBnB.

Useless gold and dangerous bitcoin up and it seems it is just starting.

Governments will do nothing. Taxi services and big hotels do not have the power to fight the disruptors, see what happened with brick and mortar retailers due to Amazon rising.

You can’t restrict couch surfers/place to stay swaps/exchanges that are free.

In Manhattan since 2015 half of the taxi services are Uber, owners of taxi medallions are bankrupt.

The advice above looks pretty much like the advice not to buy Amazon in the beginning of it’s rise because you know, it is risky and there is no way it will derail brick and mortar retailers, people always will go to the mall, right?

Wring on all counts. Join the distuptors or die.

#15 AGuyInVancouver on 06.24.19 at 5:25 pm

AirBnB is a pestilence that needs to be eradicated. Report your neighbours if you susepct they are violating bylaws or strata laws. That said, Vancouver’s registry has returned at least 300 units to the long term rental market according to The Star.
https://www.thestar.com/vancouver/2019/06/21/three-hundred-long-term-rentals-back-online-in-vancouver-thanks-to-new-airbnb-rules-says-researcher.html

Oh, and those “scant” foreign buyers…reports say capital outflows from China have dropped 83% over the last year, neatly coinciding with Vancouver’s housing market plunge. Getting jailed and fried by Comrade Xi is apparently a lot scarier than paying a tax to the Province of BC.
https://apacrealestate.com/asia-pacific-outbound-capital-falls-as-china-activity-plummets-83/

#16 I remember ... on 06.24.19 at 5:25 pm

when the ElCid used to rent out water beds by the hour. Guess they were “on the cutting edge” way back then.

#17 slam on 06.24.19 at 5:25 pm

It’s crazier in Vancouver. Taxi license can be worth 1mil…

Until Uber came:

http://www.vancouversun.com/touch/news/metro/even+before+uber+arrives+taxi+industry+disarray/11755601/story.html

#18 Andrew on 06.24.19 at 5:27 pm

https://youtu.be/tJ-LivK4-78

#19 Leftover on 06.24.19 at 5:28 pm

As always, enforce existing laws and ignore the temptation to “do something”.

La Belle Province has it right. Declare the income, collect PST, and charge people that don’t with tax evasion.

Not sexy but it works.

#20 Tom on 06.24.19 at 5:31 pm

I fully support AirBNB and the sharing economy. These places are leaps and bounds better than the crappy hotels that permeate the city. Regulate it for sure, and make sure people pay their fair share. But let’s just accept that Becks cabs and Hojo’s are a thing of the past.

#21 Mattl on 06.24.19 at 5:41 pm

#101 TheDood on 06.24.19 at 3:35 pm
#87 Mattl on 06.24.19 at 1:19 pm
#83 IHCTD9 on 06.24.19 at 12:37 pm
#75 Mattl on 06.24.19 at 10:35 am

………..Nope, not these boats. Opposite has occurred – since new inventory has gone up, that 50K boat sells used, with 400 hours, for 70K. These are specialty rigs – 22′-26′ welded aluminum, pilot house boats with offshore brackets. Hewes Searunner as an example………

________________________

Never understood why anyone in Canada would buy a boat. I mean, we are a winter country, there is snow on the ground and ice on the water 5-7 months of EVERY year. If customers actually took the time to organize/collude and backed off from buying, prices would come crashing down in a hurry. People are too easily sucked in with marketing / propoganda and are in such a rush to buy.

—————————————————–

Not sure where you live, but I can and do boat 12 months a year. Lots of open water in BC. You ever see the ocean freeze? Or the Fraser, or the big lakes in the Southern Interior?

And some of us that do boat get out alot, 30-50 trips a year. Not for everyone and not cheap but man I love getting on the water. Putting the boat in this afternoon.

#22 TurrnerNation on 06.24.19 at 5:41 pm

What if…some hardy soul started a paid pathetic weblog offering those oh so popular tips on junior miners and cryptos, to the hoarding masses?
Thus their exit from this comments section.

#23 Strategist on 06.24.19 at 5:45 pm

The article’s arguments are built upon a series of fallacies. 1. In the case of the parking lot competition (by renting out one’s driveway) it’s about using one’s available resources. That would be like sharing one’s book with a friend rather than stashing it in the library forever after reading it and prompting the friend to buy his or her own copy. The driveway owners have unused resources which they now derive a use from. Arguably it’s better for drivers parking in the lot because their parking costs will likely go down. In a way it’s similar with having disposable income or wealth and handing it over to Garth for investing for profit. 2. Taxi licenses vs. Uber – this argument pleads for maintaining an artificial monopoly – a restricted number of taxi licenses/city, plus aberrations such as metropolitan licenses being allowed to take customers to the airport but forbidden to pick others up on their way back because this is yet another monopoly of those holding an ‘airport taxi license’. Thus forcing the first category to drive back to their outskirts empty, which in the end is artificially increasing the fare cost, which often times leads to people driving their own cars and parking them at the airport (for me driving to the airport and parking it for a week is about as expensive as a two-way trip by regular cab). 3. Regarding AirBnB – this has also made hotels and world-class downtown cores more affordable to more travelers. Which has ultimately allowed more people to travel. And like Uber, driving a car and changing some sheets are very simple activities which don’t require extensive schooling or licensing for their practitioners. Coming back to taxis, I am yet to have a ‘normal’ experience with a ‘licensed cabbie’. The vast majority of whom are constantly complaining about how hard their job is, and how little they are earning. I am interested in numbers, and have asked about their incomes etc. – and guess what, things aren’t adding up – there are available jobs that pay better than they claim they make. So why are they in the taxi business, rather than switching to a better paying job, if they are unhappy about their income?

But the main fallacy is the claim that high costs and taxes are the normal for risk-free business models such as renting (or buying) a plot of land, leveling it, and renting or leasing parking spots (never mind the argument with the parking attendant in a little booth – there are apps to rent out a whole parking lot, and outsourced parking enforcement – thus cutting costs for the parking lot owner as well).

The winning society is the one that best uses all its resources, rather than one that artificially increases its GDP. For instance, Uber could very well lead to a better overall utilization of a society’s car pool – that must be factored in as well.

P.S. This is not a blind argument for the high-tech companies either – because the big ones are also building monopolies through their ecosystems. What I am advocating for however is the efficient use of resources – in that context ‘sharing’ is good. Any resources, whatever it is, that sits unused while it could be utilized productively – constitutes waste.

#24 Sail away on 06.24.19 at 5:48 pm

“Welcome to the online, sharing economy. Shifting wealth. Shuttering businesses. The creative destruction of capital.”

By no means is the AirBNB, Uber, Lyft, Rover system destroying capital. What it is doing is shifting previously-taxed business income into the hands of private citizens who may or (more likely) may not pay tax.

The overall movement of cash in the system is the same, but government may not be getting as much as before. Garth, I believe you said at some point to watch what government does with money and do the opposite.

So, how is moving cash away from government coffers into private hands a bad thing?

#25 Penny Henny on 06.24.19 at 5:48 pm

#32 Ponzius Pilatus on 06.23.19 at 10:45 pm
Re: Picture
Finally, someone figured out how to use the trunk of his
F-150 to make money.
Uber-Hearse.

//////////////////////////

First off it is not an F150. Secondly pick up trucks do not have trunks they are called ‘beds’.
What planet are you from?

#26 Dolce Vita on 06.24.19 at 5:54 pm

#12 FreeBird

Venezia has become Disneyland for the tourists.

First went in the early 60’s. I’ve probably been there 50, 60 times? over the years including last week (hop and a skip from where I live in NE Italia).

It’s very bad for the locals. They all live in Venezia-Mestre and Mogliano Veneto (last and 2nd last train stops before S. Lucia train station) and other nearby areas on the mainland because they cannot afford to live where they work. The only remaining places left to rent for the locals in Venezia is in the Giudecca district but it has no late vaporetto service. Also Dorsoduro (Ca’ Foscari University district) but even that is getting overrun by Airbnb et. al. (where I lived when I was there).

It’s very sad really to see La Serenissima reduced to a giant playground for a bunch foreigners over the intervening decades. Locals will tell you (including me) that the best part of Venezia was waking up early in the morning and listening to Mother’s wake their kids up for breakfast and school.

There were no other noises than that. No planes. No trains. No automobiles. Why she is called La Serenissima in part.

Canadian cities (and others Worldwide) can learn from Berlin (Google Search “berlin airbnb ban” – no longer banned but severely restricted):

https://www.citylab.com/life/2018/03/berlin-airbnb-vacation-rental-regulation-law/556397/

Gov’s have to regulate AND enforce what they regulate. Charge Airbnb and their guests enough and the money will be there to enforce.

Good for the Berliner Pfannkuchen (about the only thing they have that is edible to the Italian palate).

#27 crowdedelevatorfartz on 06.24.19 at 5:58 pm

@#5 Dave
“In BC guys were paying close to $500,000 for a taxi license. ”
++++

That may be the average cab license in BC.
But Vancouver is $800k.
IF you can get one.
Catching a cab from Downtown Van to the burbs is impossible and the cabbies laugh at you.
And the Province ( after ANOTHER “study” into the issue of too few cabs ) has decided to “Study” Uber for another year before deciding what to do.
I cant wait until its blown wide open and their licenses arent worth spit.

The BC Taxi association has donated hundreds of thousands of dollars to both the Libs and the NDP over the decades to ensure their monopoly is secure.

Disgusting doesnt even begin to describe it.

https://theprovince.com/news/bc-politics/ride-hailing-conflict-ndp-mlas-dad-owns-taxi-licence

#28 Feebird on 06.24.19 at 6:23 pm

love the sharing economy.
adapt or die as they say.

#29 Flop... on 06.24.19 at 6:33 pm

This guy spends some of his spare time sending the city the tweety bird to point them in the right direction.

City does nothing.

This is not the city of angels…

M45BC

“Like I said
@CityofVancouver
… whack a mole.. old AirBNB listings removed… new listings up under Salman Rajani One License #19-240572, two different self contained suite listings.”

https://mobile.twitter.com/mortimer_1/status/1141182517182996480

#30 Howard on 06.24.19 at 6:38 pm

#8 FreeBird on 06.24.19 at 4:44 pm

There’s a new group called couch surfers (vs sofa) who if agreed allow you to stay on their couch, bedroom, etc for free. Many are connected by groups like Rotary, universities, and others or just by word of mouth. From what I’ve learned while it sounds strange (even dangerous) it can work out well and provides a space for people like backpackers who need a temp place. I’m still not clear what those generous enough to offer the space get but it some cases it’s simply company.

———————————————

Couch Surfers is far from new. Been around for over a decade. What do hosts get out of it? Meet interesting new people, and the host will usually get a couch to sleep on in return some time.

#31 Howard on 06.24.19 at 6:45 pm

I was a frequent and enthusiastic user of Airbnb back 5+ years ago when the discounts vs hotel rates were significant. In Europe, the gap has narrowed considerably since then and since many European hotels offer free breakfast, it’s often more cost effective (and certainly convenient) to stay at a boutique hotel. The one exception is large groups (5 or more people) – in that case an AirBnb usually offers much better value, but then it’s harder to find a host willing to accept such a large group.

#32 Neo on 06.24.19 at 6:47 pm

Amazing what can happen with 12 years of zero interest rate policy.

Air b&b is hiring engineers in china. Globalization rocks.

https://careers.airbnb.com/?department=engineering#jobs

#33 Dominoes Lining Up on 06.24.19 at 6:49 pm

The “sharing economy” is such a fraudulent concept, it’s laughable.

In Toronto, a taxi plate peaked at around $350,000 in 2012. Now you would be lucky to sell one for $30,000.

https://www.thestar.com/news/gta/2018/11/02/toronto-taxi-owners-sue-city-for-17-billion-over-arrival-of-uber-lost-plate-value.html

https://www.taxinews.com/index.html

A lawsuit against Toronto for $1.7 billion is waiting for certification this fall. City council just this week is debating measures to try to remedy the city’s own incompetent management of the Uber fiasco. The taxi industry was never very clean or very transparent, but a far cry better than these unregulated billionaire-owned apps.

If the lawsuit goes ahead as most expect, the city could have a devastating double whammy to its revenues with those costs plus land transfer revenues dropping steadily as real estate slows. This may be copied in other cities across Canada.

#34 Out Of Work CEO, Will Travel on 06.24.19 at 6:58 pm

AirBNB is a necessary evil to keep the ever rising hotel rates from killing the poor put-upon traveller being killed by the likes of more and more taxes and fees for hotels and let’s not forget rental cars where the norm is now 30% sales tax. It’s nuts to pay $200 for a room in a Canadian city but it’s even more stupid to pay a Air Bnb $200 to sleep in a strange person’s home whom you don’t know….at least in a hotel you are aware “I am checking into the Hampton tonite (and they have a full money back guarantee) Try getting fresh towels and toilet paper in a private home where you are too shy to bother the homeowner who has gone to sleep. Tom Bodett will leave the light on at “Motel 6”. Also AirBnb charges cleaning fees and if you pay with a credit card many of the sharing folk add a fee for paying with a credit card ….weird how the “fintech folks” charge a fee for not using cash but there ya go

#35 MF on 06.24.19 at 7:01 pm

Wait, are we for more government regulation this time around?

It’s getting confusing!

MF

#36 Bonhomme Carnaval on 06.24.19 at 7:06 pm

Vacancy in the Montreal CMA’s about 1.8-1.9%. It’s a landlords market…

Kudos to the provincial government for acting (in the right way).

Lastly, have a great Fête nationale everyone! And a special shout-out to Newfoundlanders, happy Discovery Day!

#37 Henry Simpson on 06.24.19 at 7:08 pm

The impact will be nothing because the taxman always gets their cut. There are so many ways they can tax companies, people, technology etc.

It is the same old thing under the sun. Nothing new here.

#38 Remembrancer on 06.24.19 at 7:30 pm

#20 Tom on 06.24.19 at 5:31 pm
I fully support AirBNB and the sharing economy. These places are leaps and bounds better than the crappy hotels that permeate the city. Regulate it for sure, and make sure people pay their fair share. But let’s just accept that Becks cabs and Hojo’s are a thing of the past.
———————————
Except as Garth is saying, while AirBNB started as a sharing economy creature, with things like owners swapping respective vacation locations, it has morphed into just another booking marketplace with locations as primary business ventures for the owners. Sure you can say screw crappy HoJos, but at least they were in zoned areas with inn keeper act legislation regulating what was happening, not next door with no occupancy controls… You usually can’t get salt water taffy at AirBNB either…

#39 AirBnB on 06.24.19 at 7:45 pm

AirBnB is why rent in hillbilly towns like Kelowna is $2,000 per month for an apartment. Watch the VLOG Mike Martins did on that place a month ago. And the smoke hasn’t even hit there yet.

Something changed with Vancouver though. The AirBnB listings literally disappeared. Minimum 1-month rent now.

Pretty sure there is a platform (so I hear) that I have not discovered where all these units shifted over to. Something like WeChat.

But compared with 2016, there are hardly any AirBnB rentals in Vancouver (Vancouver only). They didn’t change or convert the unit, they just moved into more off-the-radar platforms to continue doing business and not having tax authorities sniffing around. Sucks for trying to rent short-term these days in Vancouver. Back to $200 a night with slim pickings.

#40 Pete from St. Cesaire on 06.24.19 at 7:49 pm

I’m all in favour of AirBNB, Uber, Lyft, Fiverr, etc. I favour ‘voluntarism’. Let the market decide, not the politicians. More power to the people.

#41 Headhunter on 06.24.19 at 7:56 pm

nice post. I can agree on apathy but not as much as I think it was just unbridled greed and “soft racketeering”

Big corps and big brother has squeezed “john q public” to the point they had to rent a room out, used car for Uber to try to make a full/part time job for themselves etc. Smart people have exploited it and good on them. We have all had the bad taxi experience and ya with only a few medallions was a ticket to print $$$.

Hotels same.

So once the guy starts and see’s he can make coin at it and applies economies of scale. Shadow hotel business.
Obviously public likes it hence popularity.

Cant put that genie back in the bottle

#42 Shawn Allen on 06.24.19 at 7:59 pm

Restricted Taxi licenses caused lack of taxis especially late night. This contributed to drunk driving.

Whenever a license that issued for essentially free by a government starts to trade for thousands of dollars, there is a problem.

There should be fair taxation but overall I agree with the arguments that freeing up wasted empty resources to be shared (voluntarily) is a good thing.

Don’t you own a motel? – Garth

#43 ImGonnaBeSick on 06.24.19 at 7:59 pm

#14 Stan Brooks on 06.24.19 at 5:21 pm

Yes, but Stan, people are going to end up owning the Amazons anyways as they reach the S&P 500 if they’re owning indexes.
They’ll also dump the companies they replace.

There’s no way to know to go all in into any of these companies, or asset classes. It seems like a no-brainer right now, but there’s no way to tell if these companies will exist in 20 years. However the S&P will still be trucking along. Granted, it will likely look much different than it does now. And if it’s not, we’ll have much bigger problems to deal with than worrying about our portfolios.

Yes, people can make a bet, but that’s all it is, and they might get lucky for a while, but they’ll likely end up a bagholder. Recency bias tells us AirBNB is where it’s at, and for a couple years, it might be. But one scandal, change in regulations/laws, a better app, and poof, it’s gone and hopefully you get out before.

#44 mike from mtl on 06.24.19 at 8:00 pm

AirBNB is a menace, worse than those discount airlines.

Travel should be expensive to weed out the cheapasses and casuals. Worse by far is the affect to localities, how does it contrite to being a living theme park?

No, f-off and go away. I certainly don’t want to live next to a amateur hostel, nor do I appreciate cheapskates with a Cuba budget. Totally side with Spanish and Italian (actual) residents here, this is not a theme park for frig sakes.

Montreal also has a similar issue, condos that only can exist from specuvestor & related activities. Areas like the plateau that are about as authentic as McDonalds.

#45 AGuyInVancouver on 06.24.19 at 8:04 pm

#11 Yukon Elvis on 06.24.19 at 5:06 pm
I live in Beijing. I own several condos in YVR. My family owns a travel agency. I rent the condos in YVR on a nightly or short term basis to agency clients. No Air Bnb required. I make out like a bandit. Tax that.
_ _ _
Parasite.

Shouldn’t be hard for someone speaking Mandarin to track the listings down and report to CRA.

#46 Timmy on 06.24.19 at 8:04 pm

Air B and B has ruined Barcelona. Locals are finally starting to push back. The same in Vancouver. Not only is it overrun with corrupt foreign cash, but people buying units and renting them out makes the price increase for rentals. The city has not done enough to curb Air B and B. It gets back to whether you think housing should be a right or an investment. Garth seems to think it should be an investment and that the government should do nothing to prevent the rich from scooping up as many units as they can. With further concentration in the US by the rich scooping up many properties, we’re becoming a more divided society.

#47 Headhunter on 06.24.19 at 8:12 pm

#46 Timmy on 06.24.19 at 8:04 pm

I can agree on all points made. Pareto’s LAW in action.

#48 Bezengy on 06.24.19 at 8:13 pm

AirBNB May be part of the problem but as far as rental space the bigger issue is landlords cannot make money. You cannot evict bad tenants or depend on our justice system to help you recoup losses from them. Far better off to bnb the place. Ask any landlord if you don’t believe me. Seriously, ask a landlord.

#49 AirBnB on 06.24.19 at 8:15 pm

This is no more than a phase in time that appears cool and profitable. It too will collapse just like timeshare condos that became a financial disaster. One can anticipate domestic and political interference, with the Airbnb concept in due time. Stay far away from these schemes.

#50 Flop... on 06.24.19 at 8:16 pm

Don’t you own a motel? – Garth

////////////////

I thought he said he had acquaintances that did in Cape Breton?

Dunno.

It’s in the archives.

Roll the tape…

M45BC

#51 Leichendiener on 06.24.19 at 8:18 pm

The sharing economy is cashless, all electronic and recorded forever. Perfect for data mining by the CRA. Doesn’t matter the platform. Once squeezed, the disrupter will roll over.

#52 jess on 06.24.19 at 8:19 pm

Office of the Comptroller of the CurrencyWashington, D.C. June 2019

https://occ.gov/topics/capital-markets/financial-markets/derivatives/pub-derivatives-quarterly-qtr1-2019.pdf

OCC Report: JPMorgan Chase and Citibank Control 76 Percent of all Precious Metals Contracts at 5,362 Federally-Insured Banks

http://wallstreetonparade.com/2019/06/occ-report-jpmorgan-chase-and-citibank-control-76-percent-of-all-precious-metals-contracts-at-5362-federally-insured-banks/

============
Congresswoman Maxine Waters, the Chair of the House Financial Services Committee, issued the following statement yesterday:

“Facebook has data on billions of people and has repeatedly shown a disregard for the protection and careful use of this data. It has also exposed Americans to malicious and fake accounts from bad actors, including Russian intelligence and transnational traffickers. Facebook has also been fined large sums and remains under a Federal Trade Commission consent order for deceiving consumers and failing to keep consumer data private, and has also been sued by the government for violating fair housing laws on its advertising platform.

“With the announcement that it plans to create a cryptocurrency, Facebook is continuing its unchecked expansion and extending its reach into the lives of its users. The cryptocurrency market currently lacks a clear regulatory framework to provide strong protections for investors, consumers, and the economy. Regulators should see this as a wake-up call to get serious about the privacy and national security concerns, cybersecurity risks, and trading risks that are posed by cryptocurrencies. Given the company’s troubled past, I am requesting that Facebook agree to a moratorium on any movement forward on developing a cryptocurrency until Congress and regulators have the opportunity to examine these issues and take action. Facebook executives should also come before the Committee to provide testimony on these issues.”

#53 Yukon Elvis on 06.24.19 at 8:37 pm

#45 AGuyInVancouver on 06.24.19 at 8:04 pm
#11 Yukon Elvis on 06.24.19 at 5:06 pm
I live in Beijing. I own several condos in YVR. My family owns a travel agency. I rent the condos in YVR on a nightly or short term basis to agency clients. No Air Bnb required. I make out like a bandit. Tax that.
_ _ _
Parasite.

Shouldn’t be hard for someone speaking Mandarin to track the listings down and report to CRA.
………………………………

The condos are actually in Richmond. My nephew goes to high school in N.Van but he get can get to Richmond in about 10 minutes in the Lambo if any problems arise with the rentals. And we are impossible to track cuz we have more numbered companies than you have had hot meals. Suckah. Hahahaha

#54 Hugh Jassel on 06.24.19 at 8:59 pm

OR NOMARLIZE INTEREST RATES!!! And all this goes away

Cheap govt money has been the source of this issue from day one and these are just new manifestations of the same problem

#55 I believe everything on Television on 06.24.19 at 9:10 pm

And Bill Morneau’s legacy? Who’s going to rent out their basement now? Not me.

#56 Bytor the Snow Dog on 06.24.19 at 9:11 pm

Ahhhhh! The hotel, parking, and taxi cartels oxes are being gored.

Too bad. Compete.

Interesting that the point of the post was the impact of Airbnb on the supply, and cost, of rental housing. The anti-corporate agenda has blinded an entire generation, it seems. – Garth

#57 pay your taxes on 06.24.19 at 9:11 pm

And why, praytell, would a taxi license cost that much? Governments artificially limiting the supply of taxis and driving up the price of cab fares. An exercise in economic rent seeking if ever there was one. And now those medallion owners have accumulated enough wealth to strongly influence local politics. Bring on Uber and crush them. The drivers just switch alliances, the demand for their services doesn’t change and they won’t be out of work for a minute.

#58 baloney Sandwitch on 06.24.19 at 9:17 pm

What is the hotel industry doing about airBNB? They should be lighting a fire under the politician’s asses to get them to do something as well as starting a class action suit against airBNB and perhaps some of the big landlords?
If someone eats your lunch, you need to punch em in the nose.

#59 Hawk on 06.24.19 at 9:35 pm

Totally disagree with today’s post (rare but there we are)

Let’s apply the residential tenancies act of Ontario to the financial planning business (or any other)

1. You can’t design your own contract with your client. The government has a new fixed “contract” you must use.

2. You can’t raise your fees as the next fiscal year starts, beyond 1.75% even if your operating costs, increase faster, which in this inflationary environment is a certainty.

3. You can’t sever your relationship with your client, unless they stop paying your fees, …..they have to leave you. To get rid of them even then you have to undergo a long cumbersome process.

4. If another client is willing to pay you a higher fee, you cannot get rid of your existing client. The very fact that someone else in the market of their own free will is willing to pay you more, means your services are worth more, but the government decides your fees must be “controlled”, because the existing client’s needs must be prioritized.

5. You can’t collect a damage deposit from your client, in advance so if he smashes up your office or your property, you could be out 10 times what you even collect in fees.

6. To enter your own office, you better give your client 24 hours notice, every time.

7. If and only if you need and can prove that you have to use your own office, can you kick out your client, otherwise he has a “right” to stay in your property.

8. Your client has a “right” to bring his pet to your office, whether you like it or not.

And 10 times more criminal communist BS than that.

Try running any other business, like that and see how it works out……..you can’t…….and neither can I.

Bye bye long term parasites……….welcome Airbnb!!!!

#60 crowdedelevatorfartz on 06.24.19 at 9:36 pm

@#53 Yukon Elvis
“My nephew goes to high school in N.Van but he get can get to Richmond in about 10 minutes in the Lambo if any problems arise with the rentals. And we are impossible to track cuz we have more numbered companies than you have had hot meals. Suckah. Hahahaha’

*******

Lol.
Good one.

#61 Lead Paint on 06.24.19 at 9:38 pm

#33 Dominoes Lining Up on 06.24.19 at 6:49

Infuriating. My friend was considering buying a taxi medallion a few years ago, everyone who bought them knew it was a speculative investment. They weren’t the ones driving or even owning the cars, just owning one or more medallions which typically appreciated nicely, given the limited supply. Attempts to increase the supply were blocked by – you guessed it – those already owning some, to keep their values up.

Now that they lost money on the speculation they want to sue the government. What a country.

#62 Sail Away on 06.24.19 at 9:39 pm

#35 MF on 06.24.19 at 7:01 pm

Wait, are we for more government regulation this time around?

It’s getting confusing!

MF

———————————–

Hahaha- great comment!

#63 crowdedelevatorfartz on 06.24.19 at 9:40 pm

@#40 Pierre from St Seizure
“I’m all in favour of AirBNB, Uber, Lyft, Fiverr, etc. I favour ‘voluntarism’. ”

+++++

‘Voluntarism (sic)” …..is that what breaking the Law, annoying your neighbours and being a tax scofflaw is called now?

#64 Linda on 06.24.19 at 9:44 pm

I would think with the regulated way AirBnB operates that any government would be able to track who is renting out what & ensure that the rental income is properly taxed. Ditto the various other rental sites like VRBO etc. I have been using those services for better than a decade now. I find the accommodations far superior to any hotel/motel room – for the same price or less, one gets the entire house/condo/apartment which normally comes with free Wifi. Most hotels charge if you connect with Wifi in the room – however, the exact same Wifi is FREE in the hotel lobby. Annoying to say the least & frankly, with the prices charged Wifi should be automatically included.

Last hotel rental: $300 for the night; Wifi not included; only one bedside light worked; fan in bathroom did not work; towels were thin/scratchy – not at all the ‘superior quality’ one would expect in a $300 per night accommodation. There was a stocked bar fridge & a coffee maker in the room, but of course one would be charged for using the supplies in the fridge. The coffee/tea was included in the room price for the bed/bath.

Last AirBnB rental: $165 for the night; Wifi included; everything worked; towels were soft & fluffy & no neighbor noise on the other side of the wall – the unit was set in a garden setting. Unit had king sized bed, separate bath, sitting area & full kitchen. We were greeted with a bowl of fresh fruit & assorted dark chocolate bars plus milk/cream for coffee in the fridge. Coffee/tea/hot chocolate supplies were also on hand. All included in the price – no ‘extra’ charge. In other rentals we’ve been greeted with bottles of wine in addition to fine dark chocolate, fresh floral arrangements & even local transit tickets.

As for the rental issue, the difference with AirBnB/VRBO etc. & rental accommodation is simple. The occupants are there for a short time only. The owner has full control over when the unit is occupied & for how long. The occupants spend money in the local economy – taxis, local transit, vehicle rentals, restaurants, grocery stores, entertainment & shopping. The owners also spend money – cleaning services, stocking the unit with bedding/linens/furnishings/basic supplies & generally provide guides to local businesses/shops/services, recommend places to visit/eat etc. That money too is spent locally – what, they are going to tell you that there is no local grocery store & not let you know about that fancy bistro just a block away? Bottom line though, is that the owner has no intention of being a full time landlord, so the expectation that the unit would become available for rent to a local tenant long term should AirBnB rentals be banned is not realistic.

#65 Hawk on 06.24.19 at 9:50 pm

Man am I enjoying the comments today.

Get used to it kiddies………as long as residential real estate was gaining 7% a year, poor landlords tolerated that absurd piece of garbage so called legislation (the residential tenancies act).

In a deflating environment lol good luck.

#66 Yvrmc on 06.24.19 at 9:57 pm

#6 Flop … great news ! It has been such a ridiculous market here for so long . Kids might even have a shot here if this downward momentum continues …. cheers bud .

#67 Dogman01 on 06.24.19 at 10:23 pm

Great article again Garth. I would bite the biscuit on a paywall if I thought the MSM could manintain the quality and relevance your content provides. Both you and your henchmen (or are they your minions?) provide great stuff on a regular basis.

How long now 10 years?

#68 NoName on 06.24.19 at 10:24 pm

Hey la vida loca, woman fifa match italy be china, are you watching?

#69 Pete from St. Cesaire on 06.24.19 at 10:26 pm

Interesting that the point of the post was the impact of Airbnb on the supply, and cost, of rental housing. The anti-corporate agenda has blinded an entire generation, it seems. – Garth
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The generation in question is anti-corporate because the corporations work hand-in-hand with the government to create and enforce stupid laws and regulations which don’t favour anyone other than the well connected few. As long as the corporations continue to comply with all of the ‘regulations’ people will simply side-step those corporations, easily done with today’s technology.

And so reap the consequences – rents and houses you cannot afford. Congratulations on your foresight. You sure showed us. – Garth

#70 Trojan House on 06.24.19 at 10:29 pm

Seems someone is being left out of this sharing economy – the government. For all those who say the rich should pay their fair share…maybe everyone should…

#71 yvr_lurker on 06.24.19 at 10:42 pm

Oh, but (sarcastically) shouldn’t we just let Mr. Market and the market forces of supply and demand dictate how AirBNB will fare? No need for Gov’t controls as their involvement always distorts the marketplace.

#72 will on 06.24.19 at 10:55 pm

Bought some more preferreds today. Straights. Hard to find. No resets for me.

#73 Pete from St. Cesaire on 06.24.19 at 11:02 pm

And so reap the consequences – rents and houses you cannot afford. Congratulations on your foresight. You sure showed us. – Garth
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
It was the central banks and the governments that set up the housing bubbles by lowering interest rates to near zero (and the populace dutifully played their part), and now it is the governments that are using the angst of those caught up in the bubble to enact laws to destroy those seen to be ‘too wealthy’, the most extreme case currently being B.C. AirBNB is just a product of, and the fallout from, the policies that created the mess in the first place.

#74 Shawn Allen on 06.24.19 at 11:08 pm

Don’t you own a motel? – Garth

I try hard not to let personal gain or loss affect what I think and say is right, fair and just.

I’ll be around the referenced motel August 29 to September 5th. Perhaps you will get a chance to stay at that motorcycle and dog friendly property. I can get you a deal.

#75 Queerbecker on 06.24.19 at 11:13 pm

You know the world is coming to an end when Quebec is leading something….

#76 lionsroarin64 on 06.24.19 at 11:19 pm

Meanwhile, back on the Wet Coast…
An author of one of the real estate reports that had tongues wagging about dirty money comes clean on the limitations of extrapolating data:
https://biv.com/article/2019/06/bc-money-laundering-estimates-may-be-wildly-mark-admits-report-author

#77 Nonplused on 06.24.19 at 11:19 pm

I am not sure AirBnB is all that destructive of a force in the market. Sure, it is creating a disruption in the hotel industry, but is it a bad thing? In theory, hotels are making less money, AirBnB operators are making more, and traveler’s are paying less. I’m not sure the overall effect is negative. Some win, some lose. But big hotel chains obviously hate it and so they talk to the politicians.

Same sort of thing as with taxi medallions and Uber. Why should taxi medallions be restricted? Why can’t the market take care of it?

In fact I am not sure we should have dairy quotas either. Dairy quotas were originally envisioned to protect small Canadian dairy farmers from competition from big US conglomerates, but at this point conglomerates have bought up all the quota and the small family dairy farm has all but disappeared anyway. If you wanted to start a dairy farm, I know of one that is shut down and for sale but you’d have to buy quota and that is prohibitively expensive. There is no way to make the numbers work. The farmer involved here realized that his quota had grown so valuable that if he sold it and shut down he’d never have to work again.

Any time a government interferes with market forces it almost always is to restrict supply and raise prices. There is a reason why a house in Calgary is so much more expensive than one in Houston. Houston pretty much doesn’t have zoning restrictions so when they need more residences they just build them.

The same thing is the net effect of minimum wage policies when used as a political tool. Originally minimum wage laws were enacted to ensure vulnerable people were not mistreated but now they are being used for economic engineering. The result is there will be less jobs and higher unemployment. Whenever you raise the price of something in theory the demand drops.

There have been occasional government policies not aimed at raising prices, but these usually have geopolitical goals. For example the US shale oil boom has been a colossal waste of money, but oil prices are set at the margin so by flooding the world with shale oil the US was able to contain the price of the whole energy market, which is many, many times larger than the shale oil losses will be once realized. Nobody is making any money producing shale oil and investors will lose all their money once the charade is over, but TPTB knows that the world economy relies on cheap energy and will go into a permanent decline without it. But that is a rare example. Most government intervention is meant to raise prices aka OPEC. And also to protect political donors.

Look at the simple case of a hot dog cart or food truck operator. Even if he has his business license and health inspections and is in good standing, most cities will restrict where and when he can operate based on the distance to nearby restaurants. How is this free market capitalism? It’s not. Every single business license the city issues is in essence an effort to provide a certain small monopoly.

You’ll see businesses operating the same way even in the food court at the mall. If there is a McDonald’s there you’ll notice there is no A&W, and vice-versa. There might be a specialty or gourmet burger place but nothing that competes directly.

And left out of this whole conversation is SkipTheDishes. I’ve found this service to be revolutionary because gone are the service boundaries and long wait times we had when the pizza shop had to have it’s own drivers, plus now virtually every restaurant is available not just the ones that use to do delivery. You can get virtually anything delivered at any time. But it has meant that the traditional shops that used to do delivery like Pizza Hut are now in direct competition with the mom & pops. Is that a bad thing? Not for me. Now I can get much better pizza from a family owned business delivered right to my door. Why should AirBnB and Uber face more restrictive policies?

Yes there are the occupancy taxes and all that they add to your hotel bill, but those are stupid anyway. The hotel is already paying property taxes. What a better way to encourage tourism and business than by dinging anyone who wants to or has to stay in a hotel with an additional, and substantial tax. What next? RV owners having to pay a $15 per night tax every time they sleep in their RV? It’s just ridiculous. But therein lies the problem with AirBnB, collecting this ridiculous tax. Even if an AirBnB operator managed somehow, which they won’t, to rent out his property 365 days a year, at $15 per night the tax is only $5475, which means it isn’t worth auditing and has to be collected on an “honesty” basis. Good luck with that.

#78 Ponzius Pilatus on 06.24.19 at 11:38 pm

#25 Penny Henny on 06.24.19 at 5:48 pm
#32 Ponzius Pilatus on 06.23.19 at 10:45 pm
Re: Picture
Finally, someone figured out how to use the trunk of his
F-150 to make money.
Uber-Hearse.

//////////////////////////

First off it is not an F150. Secondly pick up trucks do not have trunks they are called ‘beds’.
What planet are you from?
————
Semantics.
You must be the live of the party.
Oops, nobody would invite a pendant like you.

#79 Ponzius Pilatus on 06.24.19 at 11:45 pm

#31 Howard on 06.24.19 at 6:45 pm
I was a frequent and enthusiastic user of Airbnb back 5+ years ago when the discounts vs hotel rates were significant. In Europe, the gap has narrowed considerably since then and since many European hotels offer free breakfast, it’s often more cost effective (and certainly convenient) to stay at a boutique hotel. The one exception is large groups (5 or more people) – in that case an AirBnb usually offers much better value, but then it’s harder to find a host willing to accept such a large group.
————–
Howard,
I enjoy all of your posts.
Obviously you are well educated.
Unlike many of your distractors.
Keep it up.

#80 Chaddywack on 06.24.19 at 11:48 pm

Enforcement is lackluster with anything in Vancouver. There are 6 AirBnBs on my block alone. People have fires on the beaches at night (illegal), smoke in parks (also illegal), there’s a chop shop for bicycles operating in the open down on Hastings and Carrall St and the cops are powerless to do anything.

So called “anti-poverty” activists have extreme power and influence over local politicians and since the Vancouver mayor is the head of the police board he dictates what crimes are investigated or not in general.

Essentially Vancouver has turned into a lawless hipster pothead oasis with a city council with no desire to enforce anything.

Don’t even bother reporting things like AirBnB in Vancouver or empty homes leads. The city will do squat.

#81 The Greater Cauliflower on 06.24.19 at 11:49 pm

@#5 Dave

… trying to catch a cab from downtown Vancouver and go to suburbs is impossible.
Cabbies will ask you where you are headed and happily decline to drive you if it isnt as profitable to stay in downtown.

————–
EXACTLY my experience trying to get from downtown to Burnaby.
The sooner Uber gets here the better. Cabbies brought it upon themselves.

#82 PastThePeak on 06.25.19 at 12:04 am

#72 will on 06.24.19 at 10:55 pm
Bought some more preferreds today. Straights. Hard to find. No resets for me.
++++++++++++++++++++++++++++++++++++

Agree at this point. About the only thing I am buying right now is quality perpetuals that yield 5.5% or better, and trade under the call price.

However, wait until the BoC cuts rates a bit, then pickup some solid company (older) resets on good discounts. Look for ones that reset at reasonable rates not long ago (Q4 2018, or Q1 2019), so you can get really good yield for now. I saw two Enbridge issues for those two quarters that would pay 7.5% and 7% respectively for the next 4.5 to 4.75 years if you bought today.

If rates continue low 4+ years in future, you would get a reduced yield then, but as long as you are buying on the dip, even with BoC 5 year at 0.5% you could still be getting 4.5%, and always some possible capital appreciation further down the road with any rises.

Always be looking long-term, buy more of what is out of favour (but still quality names and part of your balanced portfolio approach).

#83 Stan Brooks on 06.25.19 at 12:13 am

And so reap the consequences – rents and houses you cannot afford. Congratulations on your foresight. You sure showed us. – Garth

I thought the meme is: ‘if you can’t beat them, join them’ as with the banks, no?

Gold on it’s way to 1700 USD (2200 CAD, all time high against the ‘loonie’), miners to add 50 % in the next month or two.

Fed is to cut in July.

#84 Newcomer on 06.25.19 at 12:20 am

So, if I’m rich enough to own an extra place and leave it empty for my personal convenience or to avoid paying for a hotel when travelling on business, that fine. But if I am so poor that I need to put short-term tenants in my extra place, that’s bad.

I think you are half right. A city should be able to decide how the land within it us used. But I don’t agree that the city’s ability to decide should be waived in cases where the decision inconveniences the rich.

#85 Paul on 06.25.19 at 12:28 am

42 Shawn Allen on 06.24.19 at 7:59 pm
Restricted Taxi licenses caused lack of taxis especially late night. This contributed to drunk driving.

Whenever a license that issued for essentially free by a government starts to trade for thousands of dollars, there is a problem.

There should be fair taxation but overall I agree with the arguments that freeing up wasted empty resources to be shared (voluntarily) is a good thing.

Don’t you own a motel? – Garth
————————————————————————————————
That’s funny it’s the reverse the drunks cause the shortage of cabs late at night. You have never pick up a stranger at a house or corner in a not so nice part of town

#86 Chris on 06.25.19 at 12:30 am

You are wrong on this one Garth. The problem is differential property tax rates and poor policy on taxes from local government. The local government should be getting Airbnb to collect all taxes in it’s area and o e dollar of property should be taxes the same whether it’s your house or your business.

#87 Flop... on 06.25.19 at 12:32 am

Hey Dolce, your couch taking bookings for 2026 yet?

I will book your couch for two weeks when Cortina hosts the Winter Olympics in February of that year.

I could be dead by then, but mark me down…

M45BC

#88 Paul on 06.25.19 at 12:32 am

— and get yelled at for a wrong turn then they throw up and you get to clean up the back seat.

#89 Al on 06.25.19 at 1:08 am

Victoria brought the hammer down on Airbnb. Vacancy rates improved a tiny bit in nominal terms. Rents still high. But it helped. Not nearly enough though. Airbnbers are now selliing their units into a declining market as it makes no financial sense to rent them out long term vs selling given the still crazy valuations. This doesn’t help the renters too much though. Pushes sale prices down though which may eventually help, but we’re talking years. Only one piece of the puzzle it seems. It’s never simple.

#90 Exurban on 06.25.19 at 1:25 am

A few months ago tree roots ruptured the sewer pipe in our front yard that connects our house’s toilets and sinks to the municipal sewer. A common occurrence in the heavily-treed Lower Mainland, this necessitated an emergency repair by a guy with a small backhoe who dug up the old pipe and installed a new one. As we were without functioning sinks and toilets for a few days, we decided to spend a couple nights in a hotel.

We learned just how booming the hotel business in this area is. There was absolutely nothing available under $250 a night in Vancouver,Burnaby, or Coquitlam, and very little available anywhere else. This was the off-season, midweek, early November. We wound up staying at the Best Western in Pitt Meadows for $155 a night (taxes in, as they say in the car ads). AirBnb may have some negative effects, but it’s not hurting the hotel business in this area.

#91 Dolce Vita on 06.25.19 at 1:28 am

About Airbnb et. al. and the new sharing economy:

The Genie is out of the bag.

Like Garth says it’s Schumpeter’s Creative Destruction at work…well, for the tourists anyway and a new income stream for the local gentry.

The +30 MM tourists to Venezia every year (more than all of Canada gets in a year) did not build Venezia, “I Veneziani” did and over centuries. They’ve been priced out of their own city. There has to be some benefit for that.

To Schumpeter I say: The Law of Unintended Consequences = high rents, high property costs.

I like Berlin and soon to be Québec’s approach.

I would:

1. Register and regulate them at a premium cost as the hotel industry.
2. Tax Airbnb’s earnings including that of the Owner’s.
3. Use that money for enforcement and tax cuts to the lower income locals struggling to find a place to live in they can afford.

If there are no benefits to locals other than to their gentry, then ban Airbnb et. al.

The Berliner’s had it right in the first place.

#92 Jane24 on 06.25.19 at 2:13 am

Sharing of assets with no geographical restraints is the new economy and yes all govts are way behind taxing this income; yet since it is all on line it would be so very easy for them to do so. They either don’t have the knowledge or the resources to even try. Those of you that don’t share assets and earn free bucks are envious of those that do but such is life.

Do I earn extra money of course I do. I would be stupid not too. I buy text books at charity shops, car boots and sell them on-line. Better than them going to a dump. Give the student a break too. This is small money but useful.

I rent out my driveway via a website a few times a month as I live near a big event venue. This is small money but useful. Better than the car blocking up our road and annoying the neighbours.

I Airbnb two houses when I am not using them myself. This I declare and pay tax on as quite big money. I love the AirBnb concept as with kids and grand kids and dogs, hotels don’t want us. Holiday are only affordable to us if we can take the dog/s and have a kitchen to make our own meals. We also do home exchange where no money changes hands but we can all of us, 6 adults, 4 babies and 2 dogs be together. This last one reduces the cost of holidays to flights only. Next month I will be enjoying two free weeks in a lovely condo in Montreal via Homeexchange.com. That family will then use my guest points on the system to have a lovely free holiday somewhere else in the world.

I am glad that Uber is destroying the taxi business. I once knew a lady in TO who had never driven a taxi in her life but lived off the rental of her plate by a chap who did drive her taxi. Worse she had inherited the taxi plate from her dad who had also never driven a taxi in his life. This is why TO taxis are in such poor condition and so filthy. Too much of the driver’s fares has to go on plate rental.

One can either join in the sharing economy and make it work for you or just continue to pay for services you could get for free.

#93 Oh Canada, I weep. on 06.25.19 at 3:22 am

What would happen to Disneyland if Goofy ran the show?

https://winnipegsun.com/opinion/letters/letters-june-23-2019

Well, you hire Goofy, you get Goofy.

#94 Smoking Man on 06.25.19 at 4:40 am

Back in SoCal with brief trip to Canada taken advantage of my free health care.

My cardiologist who has got to be pushing 95 said I’m in good shape I should easily make 90 years old.

Ahhh

#95 Howard on 06.25.19 at 4:41 am

#36 Bonhomme Carnaval on 06.24.19 at 7:06 pm
Vacancy in the Montreal CMA’s about 1.8-1.9%. It’s a landlords market…

Kudos to the provincial government for acting (in the right way).

——————————————–

I remember in 1999 when I was applying to university and reviewing vacancy rates in several cities. At the time Montreal’s vacancy rate was 8%!! Can you imagine? We all know why it’s plummeted since then but it would be politically incorrect to say so.

#96 BillyBob on 06.25.19 at 4:54 am

#35 MF on 06.24.19 at 7:01 pm
Wait, are we for more government regulation this time around?

It’s getting confusing!

MF

====================================

Try not to be obtuse, grasping at the slightest feeble excuse to make a claim that isn’t even accurate. Garth has never advocated laissez-faire capitalism. There’s a lot of space on the spectrum between communism and anarchism.

And looking at the “sharing” economy, most of it seems based on parasitism of systems built by others – Uber: leverages mapping tech and network infrastructure they didn’t pay for, to exploit drivers by offloading risk onto them. AirBnB: covered nicely in this post. It may be clever to take existing technologies and leverage them for your own purposes, but hardly innovative.

They are truly products of Millennial minds – want everything, but don’t want to contribute anything. Then have the supreme irony to call it “sharing” while keeping a straight face.

The thing about parasites is, they eventually kill themselves left to their own devices, as they consume their hosts. Already happening with the ride-sharing platforms. Witness LAX – all the surrounding streets absolutely clogged with loitering Uber/Lyft drivers hoping for a fare. So much traffic that nothing moves – kind of of the antithesis of an efficient transport system, no? Certainly more drivers than money to be made. Absolute gridlock and chaos. Adapt to THAT, amigos.

And so it will go until it collapses, or is regulated, like…a traditional taxi service.

Thus was it ever.

#97 Under the radar on 06.25.19 at 5:41 am

A lawyer bought the house next to my office. Renovated it without any permits , mess everywhere , does not care. Stiffed his contractor for 15k does not care. Winter did not shovel snow, does not care. Runs it as an airbnb, does not care. Bylaw enforcement too busy. They need to catch people showing up who admit they are using it as an airbnb , otherwise no evidence. A real piece of work and to think he represents the public.

#98 Captain Uppa on 06.25.19 at 6:43 am

>>Interesting that the point of the post was the impact of Airbnb on the supply, and cost, of rental housing. The anti-corporate agenda has blinded an entire generation, it seems. – Garth>>

You can be quite hypocritical at times Garth.

On one hand you scold Horgan and the NDP for trying to fend off excessive investor/speculator purchases in BC leading to higher RE prices, but now seemingly abhor the same investors/speculators for purchasing property leading to higher RE prices.

What did you think they were gonna do with these investments? Rent them out at affordable prices?!

Furthermore, it’s not just mom-and-pop investors behind Airbnb, it’s major corporations. So really it’s the for-corporate agenda that is screwing this situation.

(source: https://www.cbc.ca/news/business/biggest-airbnb-hosts-canada-corporations-1.5116103)

#99 Hamsterwheelie on 06.25.19 at 6:58 am

Dang! Miss a Garth post and offer up your opinion at #97 where no one will read ya!
I have a lot to say about Air bnb – we have a whole seperate unit, it’s in our primary residence, we claim the income. We turned a large single family house into 4 units, we live in one unit, have 2 long term sets of tenants and the Airbnb
– we like it short term because we have guests or family a few times a year (dad stayed for 3 months after his knee surgery) oh yah – we also made it accessible since there are few units built this way and we’re near a hospital.
Also, I’d like to add that since the government in no way, incentivized anything like housing co-ops, decent rental unit builds, or put in new social housing over the last decade – here we are.
Add in a gazillion laws to protect tenants while allowing landlords to go swing when a tenant decides not to pay the rent (because every tenant is a victim according to law and every landlord is a fat, opportunistic greedy pig at the trough)
I can stand at the back door of my 4 unit house and see 2 other Air bnb’s – one in a shared home where the income supplements a family to stay in their home and one that’s a whole house contributing nothing to the neighbourhood but definitely contributing to the local restos, coffee shops etc.
So – its complicated and we’ll be ok because I can rent out our place long term for close to what we make on the short term rentals – I just won’t have a suite for family to stay in. (Oh and I save myself the work of cleaning for 3 hours at every turnover)

#100 the Jaguar on 06.25.19 at 7:15 am

Hard to know who I appreciate more on this blog…Fishman (mafia) or Billy Bob ( the cool realist).
Thank you both for being you.

#101 A Dollar is a Dollar is a Dollar on 06.25.19 at 7:29 am

All of this is contributing to the impoverishment of the masses whose dollars are taxed at a higher rate than investors in Airbnb etc….

We need to stop this insanity, and treat all dollars, and all people, equally.

Even the smart wealthy ones agree.

https://www.cnn.com/videos/business/2019/06/25/abigail-disney-wealth-tax-income-inequality-ctn-vpx.cnn

#102 Expat on 06.25.19 at 7:41 am

Just wait, when CRA figures out (which they probably have) that billions aren’t being claimed, the hammer will come down.

My friends strata council has implemented a 300/night fine for all bnb owners.

20 units went for sale immediately.
Bubble? You bet

#103 maxx on 06.25.19 at 7:55 am

@ #7

100% agree that condo boards need to start writing the ban into their regulations (like yesterday) and enforcing it.

Airbnb activity of any type is 100% verboten in our building. No leases for less than a year at a time. Zero. And if management so much as gets a whiff of Airbnb activity, you’re fined. And just try not paying the fine. The place is loaded with legal types.

People want a quiet, clean, safe and pleasant place to call home. Not one filled with idiots throwing chairs off of balconies or trashing the place and being a total pain to other residents.

They can pi$$ off and take it back to hotels or do everyone a favour and stay home.

And huge kudos to Quebec for taking the initiative to force registration of Airbnb activity and tax it.

#104 [email protected] on 06.25.19 at 7:56 am

Airbnb is a plague. I’ve no problem with people renting out their spare room or basement on a short term basis. It’s entirely against the public interest to allow short term rentals for full apartments/condos where those units should be rented out long term. If you want to run a hotel, do it the right way.

#105 Tater on 06.25.19 at 8:02 am

#24 Sail away on 06.24.19 at 5:48 pm
“Welcome to the online, sharing economy. Shifting wealth. Shuttering businesses. The creative destruction of capital.”

By no means is the AirBNB, Uber, Lyft, Rover system destroying capital. What it is doing is shifting previously-taxed business income into the hands of private citizens who may or (more likely) may not pay tax.

————————————————————–
As of now, those companies have been huge destroyers of capital. At some point, their models might become profitable, but that remains to be seen. So far, they’ve been a transfer of capital from early investors to consumers.

#106 BigQ on 06.25.19 at 8:05 am

Sorry Garth, for once I think you are dead wrong.

The free market signaled a demand and need for short term rentals, which are made unavailable by government regulations and hotellery lobbies.

Airbnb created a way people could create income from their – most likely – money losing actions of buying a condo. The voluntary exchange of money between two consenting adults.

To want this to stop, and any other sharing economy progress, means to desire the shutdown of Uber/Lyft because of the voluntary exchange of money for a ride between consenting adults, the desire to shutdown Turo because of the voluntary exchange of money for a rental car between consenting adults, and the desire to shutdown Sidecar, Yerdle, JustPark, Vayable, Dogvacay, Spinlister, Leftoverswap, kijiji, Craigslist, Homedine, Homeaway, and more.

Government regulations caused monopolies in the market, but the free market will always find ways for money to be exchanged where it is treated best.

Government needs to step away from this file and let the economy flourish.

Then I trust you oppose residential tenancy regulations, too? – Garth

#107 LP on 06.25.19 at 8:05 am

#78 PonziusSemantics.

You must be the live of the party.
Oops, nobody would invite a pendant like you. Pilatus on 06.24.19 at 11:38 pm
************************************
Likely he would just hang around anyway.

#108 Louis on 06.25.19 at 8:23 am

“taking in overnight guests, collecting the revenues, yet paying no income tax, hotel tax, HST, employee costs, suppliers or commercial property tax.”

How about taxing the hotel less ? Get rid of Hotel tax and commercial property tax and let competition decide what is more efficient.

Taxi licence and Hotel tax are just government legal mafia style grab on ressources. It’s actually a good thing that innovation shake things up and put downward pressure on the prices for the benefit of the customer.

Starve government! Anarchy has broken out on this pathetic blog. Naivete is so cute. – Garth

#109 maxx on 06.25.19 at 8:27 am

@ #23

Point 1 – false. Who charges a friend for the use of a book?

Agree with the principal of market efficiency, however only inasmuch as it burns down to ash: 100% efficiency with zero fallout or spillage outside of the transaction’s equation and not such as you might find with damage caused by animals who rent and trash a place or throw a chair thrown off of a balcony onto someone or something below. Lots of negative economic fallout there.

Huge market inefficiency which society needs to impute and charge with all attendant costs to the offending business owner.

#110 Ponzius Pilatus on 06.25.19 at 8:41 am

#105 BigQ on 06.25.19 at 8:05 am
Sorry Garth, for once I think you are dead wrong.

The free market signaled a demand and need for short term rentals, which are made unavailable by government regulations and hotellery lobbies.

Airbnb created a way people could create income from their – most likely – money losing actions of buying a condo. The voluntary exchange of money between two consenting adults.

To want this to stop, and any other sharing economy progress, means to desire the shutdown of Uber/Lyft because of the voluntary exchange of money for a ride between consenting adults, the desire to shutdown Turo because of the voluntary exchange of money for a rental car between consenting adults, and the desire to shutdown Sidecar, Yerdle, JustPark, Vayable, Dogvacay, Spinlister, Leftoverswap, kijiji, Craigslist, Homedine, Homeaway, and more.

Government regulations caused monopolies in the market, but the free market will always find ways for money to be exchanged where it is treated best.

Government needs to step away from this file and let the economy flourish.

Then I trust you oppose residential tenancy regulations, too? – Garth
———
Send me your address.
And I’ll open a brothel next to you.

#111 thebarold on 06.25.19 at 8:44 am

Once politicians realize that ‘innovation’ these days means getting around pesky rules and regulations with fewer employees, maybe they won’t be courting and subsidizing it as much and look to actually increasing productivity of the workforce.

#112 dharma bum on 06.25.19 at 8:53 am

If consumers of services (accommodation, transportation, parking, etc.) can ultimately be satisfied by alternative creative means (VRBO, AirBnB, Uber, Lyft, driveways, etc.) then that’s indicative of a market force that’s working. Consumers gravitate to what is ultimately their best option, in terms of cost, convenience, and quality.
Nobody is twisting the consumers’ arms to use Air BnB.
It is not the job of government to protect the old school business models and their owners. This is an economy that rewards creativity and innovation if it perceived as such by the customer. Ever hear of the better mousetrap?
Governments and businesses have been trying to shut down the emergence of new technologies for centuries.
Why don’t we lament all of the shit shovelers that are out of work since the last horse and buggy was displaced by the automobile?
Hotels, motels, taxis, and parking lots just need to adapt, or die.
Nikon and Canon adapted to digital technology whey film became obsolete.
Should the government have banned digital imaging, or unfairly taxed the life out of it because it threatened Eastman Kodak’s business model?
The consumer decides what’s worth spending their money on.
If someone invents a device that allows consumers to communicate at a fraction of the cost of what they are paying for their overpriced cellphone plans, does anyone think that they would eschew these devices because it’s not fair to Bell, Rogers, and Telus? Ha!
These brilliant new ideas are a boon to consumers, and give users a bit of choice for a change in a country that is rife with monopolies, oligopolies, high prices, lack of consumer choice, and low quality.
Tim Horton’s anyone?

#113 IHCTD9 on 06.25.19 at 9:06 am

#78 Ponzius Pilatus on 06.24.19 at 11:38 pm
#25 Penny Henny on 06.24.19 at 5:48 pm
#32 Ponzius Pilatus on 06.23.19 at 10:45 pm
Re: Picture
Finally, someone figured out how to use the trunk of his
F-150 to make money.
Uber-Hearse.

//////////////////////////

First off it is not an F150. Secondly pick up trucks do not have trunks they are called ‘beds’.
What planet are you from?
————
Semantics.
You must be the live of the party.
Oops, nobody would invite a pendant like you.
______

Hey Ponzie! Won’t be too long now and I should have the Insurance renewals in for the Grizz and Raptor.

I’m thinking I can insure both machines in our private sector Insurance system for a whole year, for about the same as one month worth of insurance costs you on your car through your gov. run insurance Co.

Sound about right to you?

I’m just guessing…

#114 maxx on 06.25.19 at 9:07 am

@ #24

In what world is not paying your freight a good thing?

What society needs to focus on is developing the ability to come down hard and effectively on government waste.

Everybody who makes a buck needs to pay for the privilege of living in our society. Far too many freeloaders as it is.

#115 dharma bum on 06.25.19 at 9:10 am

#96 Billy Bob

It may be clever to take existing technologies and leverage them for your own purposes, but hardly innovative.
——————————————————————–

How do you think all technologies and “inventions” evolved throughout history?

Read: Guns, Germs, and Steel – The Fates of Human Societies (by Jared Diamond).

Everything we know and do has occurred by the constant leveraging of “existing” technologies.

Everything.

The existing controllers of the technologies have always opposed it.

The governments have always protected the existing controllers and owners because it was in their own best financial interests (tax, levies, tariffs).

Change inevitably comes, and the existing structures and models get shaken up. The governments eventually figure out ways to get their pound of flesh.

Sometimes it takes millennia, sometimes centuries, sometimes decades, sometimes years.

But everything WILL continue to change.

Societies move on.

#116 Tater on 06.25.19 at 9:14 am

Man, all you gold-lickers who think rates are going dramatically lower need to learn about eurodollar futures.

#117 maxx on 06.25.19 at 9:15 am

@ #28

Sharing is a complete misnomer. I have nothing against the concept so long as there is zero fallout for the rest of society and that these “sharing” entities pay their bloody taxes.

“Share” indeed……it puts a specious, slippery positive spin on activity that has absolutely the same motive as any other business – profit.

#118 BillyBob on 06.25.19 at 9:29 am

#111 dharma bum on 06.25.19 at 8:53 am
If consumers of services (accommodation, transportation, parking, etc.) can ultimately be satisfied by alternative creative means (VRBO, AirBnB, Uber, Lyft, driveways, etc.) then that’s indicative of a market force that’s working. Consumers gravitate to what is ultimately their best option, in terms of cost, convenience, and quality.

====================================

What horseshit. Consumers, or as I like to call them, human beings, act solely and almost entirely in their own self-interest. Suggesting that because a growing number of people are embracing options that are more advantageous to them, means the options are “better” for society as a whole is an utterly false, self-serving argument. The number of self-serving wannabe AirBnB moguls rationalizing away is hilarious. “We’re just doing it to move things forward”. Ah, bs.

Again: cobbling together OTHER people’s innovations into a product then selling it may be clever – and immensely profitable – but not innovation or brilliance. Most would call it leeching. Not those who profit from the changes, of course.

Your attempts at drawing parallels to obsolescence are a complete failure. The sharing services aren’t making hotels/taxis obsolete, they’re trying to make regulations that are designed to protect end users obsolete so they can pocket the profit saved by not abiding by existing rules. The fact a small fraction is passed to the end user is hardly something to celebrate.

There’s nothing wrong with changing the ways things are done, but it’s usually a good idea to make sure the new way is better than what it replaces. And “cheaper in the short term” is not synonymous with better. The fact that hordes are willing to take their chances with unregulated services to save a few bucks does not make a service “better”.

#119 crowdedelevatorfartz on 06.25.19 at 9:40 am

Well.
Since we’re in “Free the people” and “justice for all” mode.

HERE is what keeps politicians busy in the Lower Brain Land.

https://vancouversun.com/news/local-news/motion-to-remove-cecil-rhodes-sign-from-playground-on-school-board-agenda

Rewriting history one day at a time.

One hopes a student from that school will eventually qualify for a Rhodes Scholarship…….

#120 the real gong show on 06.25.19 at 9:48 am

The real gong show is yet to come. Here is a courtesy link of the precursor
https://www.buzzfeednews.com/article/karlazabludovsky/venezuela-rockefeller-bolivar?utm_source=pocket-newtab

#121 crowdedelevatorfartz on 06.25.19 at 9:58 am

@#92 Jane twofour
“One can either join in the sharing economy and make it work for you or just continue to pay for services you could get for free.”

++++++
“Sharing Economy?”
Is that what we’re calling wringing every last penny out of the middle class called?
My how altruistic of you.
Ebeneezer Scrooge would be proud.
You get school books from the garbage and sell them to students for extra cash rather than donate them to needy students.
You rent out your driveway for extra cash….I’m sure the neighbors are thrilled ( does the city By-Law Dept know?)
You make money from your multiple homes by renting to the great unwashed…..(Does your insurance company know you allow paying strangers into your home?)

Yeesh.

#122 Gravy Train on 06.25.19 at 9:59 am

#94 Smoking Man on 06.25.19 at 4:40 am
“Back in SoCal with brief trip to Canada taken advantage of my free health care.” I imagine you’ll be back to Canada for your inevitable heart, lung and liver surgeries at Canadian taxpayers’ expense. Why not, eh? Ayn Rand received Social Security payments later in life. :P

“My cardiologist who has got to be pushing 95 said I’m in good shape I should easily make 90 years old.” Better not take any chances with that winning healthy lifestyle of yours. Just to be on the safe side, smoke two extra packs of Camels, drink an extra bottle of Jack, and check out the Heart Attack Grill in Las Vegas. :P
https://en.m.wikipedia.org/wiki/Heart_Attack_Grill

Ahhh The good life! :P

#123 Howard on 06.25.19 at 10:06 am

#110 dharma bum on 06.25.19 at 8:53 am

What in God’s name was the point of this screed?

Garth’s post discussed the impact of AirBnB on the rental market and rampant tax evasion of hosts. He said nothing about government restricting it, and certainly not to protect to the hotel lobby, only that the tax evasion end and hosts treated as business people and all the responsibilities that come with it.

It’s interesting though that Canadians not declaring AirBnb income raises his ire (as it should), but millionaire satellite families claiming poverty-level incomes to receive taxpayer-funded benefits that should be reserved for Canada’s working poor….no problem!

#124 Ponzius Pilatus on 06.25.19 at 10:36 am

#112 IHCTD9 on 06.25.19 at 9:06 am
#78 Ponzius Pilatus on 06.24.19 at 11:38 pm
#25 Penny Henny on 06.24.19 at 5:48 pm
#32 Ponzius Pilatus on 06.23.19 at 10:45 pm
Re: Picture
Finally, someone figured out how to use the trunk of his
F-150 to make money.
Uber-Hearse.

//////////////////////////

First off it is not an F150. Secondly pick up trucks do not have trunks they are called ‘beds’.
What planet are you from?
————
Semantics.
You must be the live of the party.
Oops, nobody would invite a pendant like you.
______

Hey Ponzie! Won’t be too long now and I should have the Insurance renewals in for the Grizz and Raptor.

I’m thinking I can insure both machines in our private sector Insurance system for a whole year, for about the same as one month worth of insurance costs you on your car through your gov. run insurance Co.

Sound about right to you?

I’m just guessing…
—————–
I sold my car 3 years ago.
My 52$ monthly Compass card get’s me everywhere.
Keep on guessing.

#125 Ponzius Pilatus on 06.25.19 at 10:48 am

#117 BillyBob on 06.25.19 at 9:29 am
#111 dharma bum on 06.25.19 at 8:53 am
If consumers of services (accommodation, transportation, parking, etc.) can ultimately be satisfied by alternative creative means (VRBO, AirBnB, Uber, Lyft, driveways, etc.) then that’s indicative of a market force that’s working. Consumers gravitate to what is ultimately their best option, in terms of cost, convenience, and quality.

====================================

What horseshit. Consumers, or as I like to call them, human beings, act solely and almost entirely in their own self-interest. Suggesting that because a growing number of people are embracing options that are more advantageous to them, means the options are “better” for society as a whole is an utterly false, self-serving argument. The number of self-serving wannabe AirBnB moguls rationalizing away is hilarious. “We’re just doing it to move things forward”. Ah, bs.

Again: cobbling together OTHER people’s innovations into a product then selling it may be clever – and immensely profitable – but not innovation or brilliance. Most would call it leeching. Not those who profit from the changes, of course.

Your attempts at drawing parallels to obsolescence are a complete failure. The sharing services aren’t making hotels/taxis obsolete, they’re trying to make regulations that are designed to protect end users obsolete so they can pocket the profit saved by not abiding by existing rules. The fact a small fraction is passed to the end user is hardly something to celebrate.

There’s nothing wrong with changing the ways things are done, but it’s usually a good idea to make sure the new way is better than what it replaces. And “cheaper in the short term” is not synonymous with better. The fact that hordes are willing to take their chances with unregulated services to save a few bucks does not make a service “better”.
————–
Good one.
My friend who owns a Subway franchise, told me that people are using SkiptheDishes to get a few cookies delivered.

#126 Free Health Care on 06.25.19 at 10:56 am

#121 Gravy Train – Did it ever occur to you that the Smoker might be pulling a fast one? He reminds me of a quick change artist who used to work as a cashier at a major grocery chain. Does the Smoker even qualify legally for OHIP anymore?

#127 JB on 06.25.19 at 10:59 am

#109 Ponzius Pilatus on 06.25.19 at 8:41 am

#105 BigQ on 06.25.19 at 8:05 am
Sorry Garth, for once I think you are dead wrong.

The free market signaled a demand and need for short term rentals, which are made unavailable by government regulations and hotellery lobbies.

Airbnb created a way people could create income from their – most likely – money losing actions of buying a condo. The voluntary exchange of money between two consenting adults.

To want this to stop, and any other sharing economy progress, means to desire the shutdown of Uber/Lyft because of the voluntary exchange of money for a ride between consenting adults, the desire to shutdown Turo because of the voluntary exchange of money for a rental car between consenting adults, and the desire to shutdown Sidecar, Yerdle, JustPark, Vayable, Dogvacay, Spinlister, Leftoverswap, kijiji, Craigslist, Homedine, Homeaway, and more.

Government regulations caused monopolies in the market, but the free market will always find ways for money to be exchanged where it is treated best.

Government needs to step away from this file and let the economy flourish.

Then I trust you oppose residential tenancy regulations, too? – Garth
———
Send me your address.
And I’ll open a brothel next to you.
……………………………………………………………….
So today literally thousands of condo units in Toronto (and Vancouver) have been bought by investors, registered with Airbnb and are rented out as virtual hotel rooms. This means they’re commercial properties, yet pay low residential taxes. They’re usually in contravention of condo bylaws, almost undetectable. The owners collect cash flows they may not report as taxable income. And all these units are neither primary residences nor on the rental market. As a result the overall housing stock is diminished, forcing prices and rents higher.

Garths words not mine. He is correct though that these Condo Airbnb rentals have destroyed every Condo in the GTA. They are all now hotels and rental apartments. Pride of ownership is gone when they trash the places and leave a trail of destruction. That my freinds is what you get now living in a Condo. Good luck to the retirees who wanted the quiet life with no responsibilities. Now you have to wonder what is going on beside, above and below your unit.

#128 IHCTD9 on 06.25.19 at 11:00 am

#110 thebarold on 06.25.19 at 8:44 am
Once politicians realize that ‘innovation’ these days means getting around pesky rules and regulations with fewer employees…
____

You’ve brushed up against the core problem here IMHO.

Air BnB was never meant to compete on an even keel with Hotels and such. It was designed to dodge the entire ball of red tape, regulation, fees, taxes Hotels deal with, and offer a simple room in a principal residence for like half the price of a Hotel. Within this limitation, I suspect things could have carried on just fine without government or neighbours caring too much. A good idea overall.

The forces of Capitalism have since driven the original idea to where we are now – with folks buying multiple condos with the express purpose of Air BnB’ing them and nothing more. Pissing off neighbours, and entire floors in condominium towers the world over. Doing real business and not paying any taxes. Undercutting everyone. Avoiding every regulation in the book. Everyone was making money, so I guess everyone decided to not look at the future ramifications.

The Air BnB folks should have known better than to allow the (multiple) full time rentals – especially in condo towers. They asked for it – and they’re going to get it (eventually).

True story: Back in the late 90’s, there was a global top speed war going on between sport bike manufacturers. When the ’99 Hayabusa blasted to 312 km/h Regulators and Politicians took notice, and started debating if (of course) ALL sport bikes should be banned. So, to preempt regulation and avoid negative publicity, the motorcycle industry came to a gentleman’s agreement to cap speeds at 300 km/h. The concerns dissipated.

Air Bnb should have been this smart. They’re toast if they are made to compete nose to nose with Hotels – and all these STR only condo owners are going to burn with them. The last thing that burns, will be the original good idea of renting out a spare bedroom in a principal residence for a night in a tax and regulation free manner – under the radar. That will now be business activity too…

#129 whiplash on 06.25.19 at 11:11 am

Operate an Airbnb? I would be giving my insurance broker a call to see if my homeowners or tenant insurance covers any claims. I highly doubt that a claim would be covered if a guest slipped on a throw rug and broke their arm and decided to file a lawsuit. Or do you roll the dice and hope the hell nothing happens with any guests. What are medical costs these days? Expensive.

#130 James on 06.25.19 at 11:15 am

#121 Gravy Train on 06.25.19 at 9:59 am

#94 Smoking Man on 06.25.19 at 4:40 am
“Back in SoCal with brief trip to Canada taken advantage of my free health care.” I imagine you’ll be back to Canada for your inevitable heart, lung and liver surgeries at Canadian taxpayers’ expense. Why not, eh? Ayn Rand received Social Security payments later in life. :P

“My cardiologist who has got to be pushing 95 said I’m in good shape I should easily make 90 years old.” Better not take any chances with that winning healthy lifestyle of yours. Just to be on the safe side, smoke two extra packs of Camels, drink an extra bottle of Jack, and check out the Heart Attack Grill in Las Vegas. :P
https://en.m.wikipedia.org/wiki/Heart_Attack_Grill

Ahhh The good life! :P
__________________________________________
Old Man you are so full of bullshit that it flows left right and centre out of you. What would any so called multi millionaire be coming here with what most Americans refer to a second class socialized medicine in Canada. You trash us every single time your on this blog. Go and pay for your American health care medicine and checkups out of your own pocket and stop feeding at the trough here. If your so dam wealthy go to to Blue Shield of California with the Platinum 90 PPO. Its only 3000 USD per month. That will cover you and the wife.

#131 Eks dee Siple on 06.25.19 at 11:16 am

As usual, most of you are missing the point Garth is making in this post (reading comprehension obviously is not a strong suit for you dogs). He is not suggesting that competition and technology is a bad thing. Just that ‘politicians’ have been dinosaurs in catching up. But I would like to point out that it is mostly boomers who have guzzled up these condos (yeah, I know, “for their kids”) and created this AirBNB fiasco. And those ‘politicians’ Garth is referring to, have dozens of these airbnb condos themselves (not to mention homes as well), so it is no wonder they have been slow to do anything.

But this is a case study in what I always say: Any economic system based solely on greed will always fail. A rising tide DOES NOT lift all boats if some of them were taking on water. The economics of these oligopolies in transport and accommodation is crumbling. Financial advisors next:)

#132 Flop... on 06.25.19 at 11:51 am

Garth’s favourite buddies, the B.C NDP, just got 14 million out of Air Bnb in P.S.T remittances.

pssst…..they are doing a better job of just sweeping everything under the Filth Rug like the last lot…

M45BC

#133 IHCTD9 on 06.25.19 at 11:52 am

#123 Ponzius Pilatus on 06.25.19 at 10:36 am

I sold my car 3 years ago.
My 52$ monthly Compass card get’s me everywhere.
Keep on guessing.
____

So you got no wheels, and are shelling out 625.00/yr to sit on buses and trains.

Sorry to hear.

Why don’t you get a small motorcycle? It’ll cost less than your fancy bus pass to run (well, in Ontario it does, YMMV in CCCP land). Ms IH has a Virago 250, gets almost 90 mpg on the highway, and costs 400.00/yr to insure.

What happens when you want to go camping/fishing/road trip etc…

#134 fishman on 06.25.19 at 11:53 am

Jaguar: The Bulls in the Lower Brainland can only wish that the Italians & H.A.’s were still running things. At least they could deal with those people. Punjabi, Chinese. Middle Eastern Arabs, Hispanics, Africans. These ethnic gangbangers march to a different & crueler drummer.

#135 Damifino on 06.25.19 at 12:05 pm

#131 Flop…

Garth’s favourite buddies, the B.C NDP, just got 14 million out of Air Bnb in P.S.T remittances.
——————————————-

A pittance, equal to maybe three Dunbar tear downs.

#136 Damifino on 06.25.19 at 12:10 pm

#132 IHCTD9

What happens when you want to go camping/fishing/road trip etc…
————————————–

A true Vancouverite would never do anything so vulgar.

#137 Smoking Man on 06.25.19 at 12:13 pm

Doesn’t take much to trigger the socialist on here

Ha

#138 Gravy Train on 06.25.19 at 12:39 pm

#125 Free Health Care on 06.25.19 at 10:56 am
“Did it ever occur to you that the Smoker might be pulling a fast one? He reminds me of a quick change artist who used to work as a cashier at a major grocery chain. Does the Smoker even qualify legally for OHIP anymore?” Well, regardless of his eligibility for medical services here in Canada, I was merely pointing out his hypocrisy (or, as James said earlier today, his bullshit).
I am grateful you didn’t criticize me for the health advice I gave him! :P

#139 Ubul on 06.25.19 at 12:46 pm

Rover, Rbnb, Uber, Lyft exists only, because there is a market for the service they provide.

They utilize mostly “dormant/dead” asset. Some of those were utilized before, like renting out driveway, rooms, apartment, cottages, but with local, fairly small operators.

What sets apart these new companies is that they create technology that can make their services available for enterprising individuals, on a global scale, that previously only giant companies could afford.

In the past very expensive technology was a tool to maintain market dominance by the high entry cost.

These new companies turned this around and made technology a tool to lower the cost of entering into the economy as a business actor, offering individuals to monetize their dormant assets, labour capacity.

The revenue taxation is not an issue, as sharing economy runs on software that keeps much more accurate record on accounting than previous, small, local agencies or completely under the table deals, from flyers.

Taxi licenses were prone to corruption, due to artificial selection and because what they were really buying was being a protected player on a market, with limited competition. What happened was the concentrated ownership of licenses and horrible service.

If Rbnb drives up the price of rentals, the obvious free market option is to build more, to bring supply demand in a better balance.

#140 MaxBerniersShorts on 06.25.19 at 12:49 pm

#105 BigQ
LOL, I knew someone would show up simpering about the virtues of the “sharing economy”! There’s nothing “sharing” about AirBnB, are you cooking them a meal in exchange for a room? You’re paying them . They’re not “sharing”.

#141 JB on 06.25.19 at 12:49 pm

#125 Free Health Care on 06.25.19 at 10:56 am

#121 Gravy Train – Did it ever occur to you that the Smoker might be pulling a fast one? He reminds me of a quick change artist who used to work as a cashier at a major grocery chain. Does the Smoker even qualify legally for OHIP anymore?
……………………………………………………………………..
Yes I agree I think he is scamming the health system while living in the LA socal area. It appears that he comes back to the GTA every six months and I think that is what you have to legally do in order to keep your Ontario health care valid. It appears that Smoky is good only for two years of scamming this though. I thought he was a millionaire with all of his money tucked in a Caribbean offshore account too?

Working outside Canada

If you’re planning to work outside Canada on a full-time but temporary basis, you can apply for this coverage if you:

have a valid Ontario health card
e.g. offer of employment, contract or letter from them
will be in Ontario for at least 153 days a year in each of the two years immediately before you leave the country

#142 Flop... on 06.25.19 at 12:57 pm

#134 Damifino on 06.25.19 at 12:05 pm
#131 Flop…

Garth’s favourite buddies, the B.C NDP, just got 14 million out of Air Bnb in P.S.T remittances.
——————————————-

A pittance, equal to maybe three Dunbar tear downs.

//////////////////////////////

The main point was at least the current government is having a stab at solving local problems, naturally not everyone will be satisfied.

The 14 million is just the start, I guess they are going for the if you can’t beat them, tax them, angle.

Someone wrote the other day that the NDP had a mandate to tackle the provincial housing problems.

I would hardly call sliding into power the way they did a mandate but they drew up a plan and are executing it and will be judged accordingly at the next election.

The former government rode a global tidal wave and decided to try and insist it was different here and decided not to tackle local problems.

After losing the election the B.C Liberals had a chance to go younger, fresher, with new ideas but they wheeled out the same cronies and might pay for that at the next election.

Governments like to promise a lot on the campaign trail and then put it in the too hard basket when in power, love them or hate them the current government in B.C cannot be accused of this…

M44BC

P.S NoName, China versus Italy in women’s soccer.

Battle of the shorties…

#143 Sail away on 06.25.19 at 12:59 pm

There’s a fair bit of hard-edged anger on this blog. My guess from the comments is that most of the posters are not employers, 1%-ers, or financially independent, since the ‘stick it to the rich’ mentality seems to dominate.

Anyway, my time in the comment section is over. I know a few of the lower species will take great pleasure.

#144 James on 06.25.19 at 1:19 pm

#136 Smoking Man on 06.25.19 at 12:13 pm

Doesn’t take much to trigger the socialist on here

Ha
_________________________________________
Ha your a socialist then as you use the social medicine system in Canada, therefor by using it you you practice the use of it and promote it.
Socialist: a person who advocates or practices socialism.

#145 IHCTD9 on 06.25.19 at 1:23 pm

#111 dharma bum on 06.25.19 at 8:53 am
____

Your post is essentially not wrong, but the pretense that Air BnB is “out-competing” its rivals incorrect. Air BnB is simply undercutting its competition (so far) by avoiding the regulation and taxes its competition must pay. In essence, Air BnB (and the like), are the black market versions of standard Hotels. Like hiring a guy to roof your house, or fix your car for cash. The guy is going to be cheaper, but it is not through creativity or innovation that it was done. Such is life in a highly taxed, big (slow) government Country, too easy, and too tempting.

Real innovation and creativity would out-compete its competition on a level playing field, and as far as I can see; most of these “sharing” apps don’t do that. They all cut the government out to lower the price.

That said – if our bird-brained government is going to sit on their hands – then more power to the short term rental crowd. Our [email protected] leadership is near useless – how much of that knowledge is baked into the short term rental market in Canada? Air BnB has (quickly) folded like a cheap suit to the demands of the Chinese Government, as have the rental owners themselves – wonder why?

Here in Canada, everyone knows it takes forever and a day to get anything done. Then, after 5-10 years and 200 million spent on studies and inquiries – no consequences for anyone whatsoever. I expect after legislation finally hits the books, they’ll keep on renting because we can’t enforce jack either.

Our government created the playing field, and it’s their responsibility to make sure everyone plays by the rules. If they won’t do it, then I couldn’t care less if every Hotel in Canada folded and re-opened under the table as an Air BnB.

#146 I'm A Believer on 06.25.19 at 1:35 pm

If government starts telling owners who they can and can’t take as tenants, why would anyone invest/construct rental unit(s). Shouldn’t matter if it’s short or long term rental. Rental is rental. Doesn’t that also reduce rental unit market?

#147 Cardiologist on 06.25.19 at 2:15 pm

I find it hard to believe that a cardiologist pushing 95 would be even working on a Saturday or Sunday, let alone would ever have the equipment at his residence to conduct an assessment. Maybe the Smoker came back to party, and there was the Parade on Sunday to attend.

#148 oh bouy on 06.25.19 at 2:30 pm

@#142 Sail away on 06.25.19 at 12:59 pm
There’s a fair bit of hard-edged anger on this blog. My guess from the comments is that most of the posters are not employers, 1%-ers, or financially independent, since the ‘stick it to the rich’ mentality seems to dominate.

Anyway, my time in the comment section is over. I know a few of the lower species will take great pleasure.

___________________________

Vocal minority populates this comments section.

#149 PoorEngineer on 06.25.19 at 2:55 pm

I know someone who runs a taxi and nets over 200K per year, mostly cash. He only decades around 40K, and he says he declares more than his friends. Government also gives him a fat check monthly for his child since he makes so little..

Hence I support Uber!
(Along with AirBnB, Rover, etc).

#150 AGuyInVancouver on 06.25.19 at 2:58 pm

#142 Sail away on 06.25.19 at 12:59 pm
There’s a fair bit of hard-edged anger on this blog. My guess from the comments is that most of the posters are not employers, 1%-ers, or financially independent, since the ‘stick it to the rich’ mentality seems to dominate.

Anyway, my time in the comment section is over. I know a few of the lower species will take great pleasure.
_ _ _
Earth to Sail Away: most of the population are not employers, 1%-ers, or financially independent.

#151 CJBob on 06.25.19 at 2:59 pm

You’re already required by law to report all your income from whatever source. Air BnB income is not exempt and requires no additional laws to require its reporting. Failing to report may well amount amount to tax evasion, a criminal act.
_____________
Yep, that is just one of many, many alternative facts in Garth’s post today. No credibility when you are trying to make a valid point and just make sh*t up.

#152 oh bouy on 06.25.19 at 3:01 pm

@#96 BillyBob on 06.25.19 at 4:54 am
#35 MF on 06.24.19 at 7:01 pm
Wait, are we for more government regulation this time around?

It’s getting confusing!

MF

====================================

Try not to be obtuse, grasping at the slightest feeble excuse to make a claim that isn’t even accurate. Garth has never advocated laissez-faire capitalism. There’s a lot of space on the spectrum between communism and anarchism.

And looking at the “sharing” economy, most of it seems based on parasitism of systems built by others – Uber: leverages mapping tech and network infrastructure they didn’t pay for, to exploit drivers by offloading risk onto them. AirBnB: covered nicely in this post. It may be clever to take existing technologies and leverage them for your own purposes, but hardly innovative.

They are truly products of Millennial minds – want everything, but don’t want to contribute anything. Then have the supreme irony to call it “sharing” while keeping a straight face.

The thing about parasites is, they eventually kill themselves left to their own devices, as they consume their hosts. Already happening with the ride-sharing platforms. Witness LAX – all the surrounding streets absolutely clogged with loitering Uber/Lyft drivers hoping for a fare. So much traffic that nothing moves – kind of of the antithesis of an efficient transport system, no? Certainly more drivers than money to be made. Absolute gridlock and chaos. Adapt to THAT, amigos.

And so it will go until it collapses, or is regulated, like…a traditional taxi service.

Thus was it ever.

_________________________

LOL, Mf makes a good point.
you dinosaurs just can’t stand change at all.

#153 powder_hound86 on 06.25.19 at 3:08 pm

Wow, the conservative leaning Garth is crying for government intervention into markets. Oh the hypocrisy.

#154 Russ on 06.25.19 at 3:17 pm

James on 06.25.19 at 1:19 pm
#136 Smoking Man on 06.25.19 at 12:13 pm

Doesn’t take much to trigger the socialist on here

Ha
_________________________________________
Ha your a socialist then as you use the social medicine system in Canada, therefor by using it you you practice the use of it and promote it.
Socialist: a person who advocates or practices socialism
===============

Whoa!

Jimmy Boy called Smokie a socialist.

Is Smoking Man gonna take it or walk out on us?

Cheers, R

#155 Ronaldo on 06.25.19 at 3:39 pm

Anyway, my time in the comment section is over. I know a few of the lower species will take great pleasure.
—————————————————————–
He’ll be back. Addicted like the rest of us.

#156 PastThePeak on 06.25.19 at 3:46 pm

Stock market is throwing a temper tantrum…

#157 bdwy sktrn on 06.25.19 at 4:46 pm

Witness LAX – all the surrounding streets absolutely clogged with loitering Uber/Lyft drivers hoping for a fare. So much traffic that nothing moves
———————
???
google says all green right now.
my recent trips in and out by car were faster than yvr. it was the rest of the city that was gridlock

#158 Shawn Allen on 06.25.19 at 5:18 pm

Don’t Bash Tim Hortons

These brilliant new ideas are a boon to consumers, and give users a bit of choice for a change in a country that is rife with monopolies, oligopolies, high prices, lack of consumer choice, and low quality.
Tim Horton’s anyone?

*****************************
Agreed about new ideas being a boon to consumers. They need to be regulated to some extent and not interfere with others reasonable enjoyment of property.

But why bash or disparage Tim Hortons?

They created their business one location at a time as something that basically did not exist before the 1970’s. There were a few donut shops but I don’t think there was a big habit of going there.

As a kid in the late 60’s and through the 70’s my family did a lot of road trips. There was zero stopping at the likes of Tim Hortons or the few McDonalds that then existed. Gas stations were just gas stations where you got gas (and not infrequently oil) No coffee or snacks of any kind were ever purchased. Especially not with the five and then six kids plus parents. Food was prepared at the trailer or tent site. Nothing bought from restaurants of any kind in those days. (Which so many think were such easy days)

Now people, whether they like to admit it or not, tend to stop after about two or three hours and buy coffee and often a snack. Which leads to a restroom break at the next Tim Horton’s within another two hours.

There are a number of choices of where to stop. We all can see that Tim Hortons wins the lions share of the business. Customers apparently see it as good value no matter that some complain about quality. They vote with their wallets.

Better to invest in Tim Hortons than to bash such a proven winner.

#159 X on 06.25.19 at 5:23 pm

So everyone wants to utilize Air BnB, Rover, Lyft, Uber, to make some extra $ and not pay tax on the income earned, yet they want the rich to pay more in taxes for everything to be provided for them.

#160 Where's The Money Galen? on 06.25.19 at 7:23 pm

Re: #9 The Wet One on 06.24.19 at 4:47 pm
Garth,

You’re already required by law to report all your income from whatever source. Air BnB income is not exempt and requires no additional laws to require its reporting. Failing to report may well amount amount to tax evasion, a criminal act.
+++++++++++++++++++++++++++++
Wouldn’t it be nice to see this extend to Galen Weston, who owes we Canadians and CRA $368 Million for tax evasion, determined last August after a 4 year legal proceeding.
How come this scofflaw hasn’t been criminally charged?
“On Friday, the Tax Court of Canada ruled on a case that was started in 2015 but traces its roots to 1992, when the grocery chain incorporated an offshore company in Barbados that later obtained a banking licence and became known as Glenhuron Bank Ltd.”.
https://www.cbc.ca/news/business/loblaws-tax-barbados-1.4816973

#161 Nonplused on 06.25.19 at 7:48 pm

Oh and I forgot to mention in my rant car2go and all the crazy half electric powered bikes that are showing up on sidewalks everywhere.

The future seems to be renting, not owning, whether cars, bikes, skis, houses, boats, anything. Of course renting has always been around, but I think the concept of renting everything really took off with the VHS tape. Too bad for Blockbuster that they did not see the internet coming, but they introduced (and others, actually it was probably the mom and pops but Blockbuster became big) the concept of renting a cassette tape. If you can rent a cassette tape, you can rent anything.

It was actually very environmentally responsible, if you think about it. If everyone who wanted to watch “Raiders of the Lost Ark” in the comfort of their own home twice maybe or three times had to buy a copy, that’s a lot more cassette tapes than what Blockbuster did. Other than “the tragedy of the commons”, economic capitalism actually does move towards environmental conservation over the long run. The point of capitalism is to extract the most benefit at the least cost, so where things can be re-purposed they will be.

We are already at the point where an iPhone is more computer than most people will ever need. And look how small it is! A lot smaller than my desktop computer or even my laptop. It fits in my pocket! I have to assume it causes less environmental damage to produce and recycle or trash than either of these other computing formats. Motorola did an experiment years ago where they tried to sell a phone that had an available laptop type docking station so the phone would be both a phone and a laptop. It didn’t sell well. But the concept was good, had it taken off you could upgrade your whole system by just replacing the phone.

Anyway, get out there and buy your “paper water box sort of things”.