Short-term rental units are becoming very popular – and sometimes a nuisance – in larger urban centres or quiet cottage-country communities, but Sault Ste. Marie has not experienced the crisis that others have.
It’s been over a year since the City of Sault Ste. Marie followed the wave of many other municipalities and passed a bylaw ensuring short-term rental units (STR) are properly licenced and regulated.
The trend to impose licensing grew substantially over the past few years, and to date, has been left to the municipalities to enact and enforce their own bylaw.
Some argue regulations should be established at the provincial level to create an even playing field across Ontario, especially noting health and safety standards, and eliminate unnecessary confusion between municipalities. Provincial legislation would likely also come with stronger enforcement tactics and relieve a potential financial burden on municipalities.
Sault Ste. Marie’s licencing process is designed to ensure an STR home is safe.
Under the current process, the building department ensures compliance under the building code, fire safety is examined, and the home is registered to ensure Tourism Sault Ste. Marie receives the municipal accommodation tax for short term stays. Hosts are also provided with good neighbour guidelines and various tips.
The bylaw also requires STR hosts to include their municipal licence in all advertising. Hosts must also have “appropriate” insurance to satisfy the city’s $2-million liability requirements and add short-term rental as a property use.
The number of short-term rental properties in Sault Ste. Marie saw a slight surge in popularity over the past five years, but those numbers have since leveled off, city staff said.
It’s not known how many illegal — or unlicenced — STR’s exist in Sault Ste. Marie.
City data released last year shows that in March 2017 there were 17 active STR listings, 66 in February of 2020 and 158 in September 2023.
Most the listings – 71 per cent – are for entire residences, 46 for private rooms. There were listings for 114 houses and 44 for apartments, the data found.
To date, there are 21 approved STR licenses across Sault Ste. Marie. Another 20 applicants have filed applications to obtain their licence.
The city has said it will be increasing its enforcement of its STR licencing bylaw, focusing on a more proactive enforcement policy.
Sault Ste. Marie’s chief building officer Freddie Pozzebon said a joint working group has been formed to develop the framework around some proactive enforcement to ensure STR are not disruptive to neighbourhoods.
Licencing requires a home inspection from the city’s building division to ensure that safety standards are met, and the house follows the current property standards and building code, among other things. The city also ensures that any open permits receive their final inspections and are closed.
Some jurisdictions regulate the minimum number of rented nights per unit and limit the number of renters per bedroom. Some municipalities limit short-term rentals to primary residences only – allowing a property owner to only rent out a room in their home rather than the entire property.
City solicitor Karen Fields said changes can always be made to the bylaw but limiting STRs wasn’t believed to be necessary at the time the bylaw was drafted, and subsequently approved by council.
Bylaws are enacted to enforce licencing requirements, often with hefty fines attached for failing to comply with licensing procedures.
To date, there has not been any charges under the bylaw laid, Fields said, although the city’s legal staff has begun to review two cases where potential charges could be laid in the future.
Short-term rentals can also impact the affordable housing market in a community, preventing the long-term availability of rental units, some argue.
“That’s an issue that can especially worsen housing affordability in large urban centres,” said Tonazzo.
“We recognize that short-term rentals can lower the availability of rental units in a market, but it is our opinion that in Sault Ste. Marie, there is such a small number (of STR’s) and they’re not necessarily in the same markets, that the impact would be negligible,” he said.
Tonazzo said that with an influx of international students and newcomers through the Rural and Northern Immigration Pilot program, some use STR’s instead of hotels as their first places to live to “fill the gap” to become accustomed to the community until they are able to secure more suitable housing.