Strata hotels will have short-term rental exemptions, says BC government

Boucherie Beach Cottages in West Kelowna. (Kind Developments)

Following an outcry from some municipal governments of tourism-dependent communities and hospitality property owners, the Government of British Columbia has provided a new clarification for short-term rentals operating in strata hotels and motels.

The forthcoming new short-term rental regulations with a principle residence requirement will begin on May 1, 2024.

Properties used as strata hotels or motels on and prior to December 8, 2023, can qualify for the principle-residence exemption if they operated similarly to a hotel or motel, including a staffed front desk on site, have one or more staff or contractors that provide housekeeping services and have a platform providing platform services available exclusively for the use of owners offering short-term rentals at the property.

Alternatively, for such properties before December 8, 2023, there would be exemptions if the accommodation was being provided in a manner similar to a hotel or motel, and more than one strata lot on the property is not able to be used as a principal residence by anyone due to legal-use restrictions under zoning, a rental management agreement, and/or a restrictive covenant.

For newly built strata hotels or motels that were ready for guests on or after December 8, 2023, in order to be exempted, such properties must operate similarly to a hotel or motel — following the three aforementioned operational requirements — and at least one of the legal-use restrictions.

“The exemption for strata hotels and motels is expected to apply to all units on the property, so there is consistent treatment of all of the units for the entire property. Other properties, such as existing residential buildings that do not meet the above requirements, will not meet this exemption from the Province’s principal-residence requirement,” reads the provincial government’s bulletin today.

“Strata hotels and motels are facilities made up of individually owned strata lots, where accommodation is provided in a manner similar to a hotel or motel. Units in strata hotels and motels are often managed and rented out by the strata hotel or motel, not the individual.”

Last month, in accordance with some of the flexibility offered under the provincial legislation, the City of West Kelowna created a principle-residence exemption for short-term rental properties within the jurisdiction’s tourist commercial zones, which is a move that enables purpose-built commercial vacation properties such as Barona Beach Resort, Boucherie Beach Cottages, Paradise Estates, The Cove Lakeside Resort, and Casa Loma Resort to retain their longtime short-term rental operations.

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