Supporting the expansion of affordable housing in Toronto’s Kensington Market

Short-term rental platforms like Airbnb have been shown to remove available housing stock in markets already suffering from a housing crisis. In fact, they have removed housing stock faster than land trusts have been able to protect them. In neighbourhoods that depend on tourism, growth in commercial short-term rentals has begun to threaten the housing security of residents.

This project will:

• demonstrate an alternative model for community-based tourism accommodations that also support housing availability and affordability for residents
• establish a short-term rental cooperative platform that provides residents with an income stream
• help support housing security and protect the availability of existing housing stock

The platform’s booking fees will be used to create a regular revenue stream for local land trusts working on affordable housing.

Project scope and expected outcomes

Using the short-term rental market as a way of preserving housing affordability

The community land trust (CLT) movement is gaining recognition across Canada as a tool to address affordability challenges in cities. CLTs are non-profit corporations created to acquire and hold land for a community. The land is perpetually held in trust to help provide access for community use, such as affordable housing. CLTs are membership-based organizations, governed by an elected board of directors, and often made of community members and non-profit organizations.

Scaling up CLT activities is a challenge, but Toronto’s short-term rental market offers an opportunity to help housing affordability. Many of Toronto’s short-term rentals have been converted from long-term housing to tourist housing. This contributed to skyrocketing rental costs before the pandemic, and evictions linked to commercial short-term rental conversions were common.

This demonstration, however, aims to use the short-term rental market more sustainably, as a way of preserving housing affordability and helping local CLTs.

Implementing an innovative short-term rental platform cooperative

The project will focus on Toronto’s Kensington Market, a downtown neighbourhood that depends on tourism, but where most residents are tenants. With support from the National Housing Strategy’s Demonstrations Initiative, it will pursue 2 separate but related objectives:

• It will establish a model cooperative short-term rental platform that can provide residents with a stream of income to support housing security.
• It will use the platform’s booking fees to create a regular revenue stream for local land trusts working in affordable housing.

The project will take advantage of Fairbnb.coop, an innovative short-term-rental platform cooperative already used in several European cities. It will establish the first North American Fairbnb node in Kensington Market, recruiting and training short-term rental hosts. These hosts will offer rentals, much like other short-term rental platforms, but in their own homes. No long-term housing will be converted into short-term rentals.

This cooperative structure will enable residents to earn a stream of income to support their housing security. The platform’s booking fees will be split equally between cooperative operations and the Kensington Market Community Land Trust. This will provide the Trust with an income stream that it can use as it sees fit.  

Increasing resident incomes and improving overall housing affordability in Kensington Market

The model offers many benefits. Kensington Market residents will earn a supplemental income from the short-term rentals. This will help with their housing security and the entire neighbourhood will benefit from the increase in resident incomes.

Importantly, it will also help overall housing affordability without affecting tourist accommodation. Short-term rentals will be offered through existing homes, meaning local residents will not compete with tourists for accommodation.

The short-term rental platform cooperative will also help establish and grow a sustainable revenue stream for the Trust. This will help the trust continue its work to support, protect and increase Kensington Market’s affordable housing. As the cooperative grows, it will be able to offer support to other CLTs and affordable housing providers, first in Toronto and then in other Canadian markets struggling with the impacts of overtourism.

Supporting a sustainable tourism model

The team and its partners will engage with neighbourhood groups and housing advocates to promote resident participation in the project. The project team will also work to incorporate Fairbnb locally, adapting it to local conditions and regulations. This includes working with a cooperative developer to ensure that Fairbnb Toronto’s governance and operations reflect community priorities.

The project will then begin building a host network and launching its operations. Fairbnb Toronto and the Trust will hold information sessions for potential hosts. They will also ensure host eligibility, help them register with the City of Toronto and provide training and other support. The local Fairbnb node will launch once 30 hosts have been registered and have listed their properties.  

The team will then work to increase the host network for the remainder of the project. They will work with local universities and colleges that are likely to use short-term rentals. They will also host events to attract domestic visitors and support a sustainable tourism model. The project will undergo a final evaluation to see if it met its goals and targets.

Demonstrating a sustainable, replicable model for raising community land trust revenue

The project will demonstrate a sustainable, replicable model for raising revenues for CLTs in Canadian cities with tight housing markets. It will be adaptable to other urban markets and those with a significant tourism presence. The project’s final stage will create a workshop on lessons learned for other CLTs and community groups to use.

In the short term, the project will give residents a chance to earn income through short-term rentals. They will also be able to help with community development through the CLT and cooperative contributions. Over the longer term, the neighbourhood will benefit from a decrease in short-term rental operations and an increase in resident income. The Kensington Market Community Land Trust will also benefit from an increase in revenue, which could develop into a significant revenue stream over time.