In a bid to balance surging demand for short-term rentals listed on online booking services and concerns about noise, traffic and public safety, city staff are recommending London move to implement licensing for owners of short-term rental accommodations (STAs).

A report coming to the city's community and protective services committee Wednesday outlines proposed regulations for STAs, which allow property owners to rent out their houses and apartments using an online booking tool.

The report says STAs were used in over 57,000 guest arrivals between January 2019 and January 2020. Airbnb hosts earned about $7.7 million in the last 12 months, the report says.

But the ease of renting and posting properties online can also lead to problems.

In August, nine people were arrested after a wild party caused $80,000 in damages at a house in Old South that was listed on Airbnb.

This month, Airbnb announced it will step up its security measures after three people were fatally shot in a downtown Toronto condo unit rented using the online booking platform.

And while landlords of traditional rental properties must adhere to a host of rules, STAs currently operate without any regulations in London.

Coun. Anna Hopkins pushed for staff to look at regulations last fall, saying shot-term rentals were leading to problems with with neighbourhood houses "being used as hotels."

Last year London property owners raked in about $7.7 million renting out their properties on Airbnb. There were 57,000 inbound guest arrivals in 2019. (Charles Platiau/Reuters)

The staff report lays out proposed regulations aimed at allowing short-term rentals to operate while trying to mitigate potential problems.

They include:

Creating a new class of rental licence within the city's existing residential rental units licensing bylaw. Applicants would have to meet the same eligibility conditions required of other landlords.

Property owners would need to list a valid registration number on any online ad for short-term accommodation.

The property owner would have to list whether or not the rental is their primary residence, among other information.

What about the accommodation tax?

In 2018, the city brought in an accommodation tax, which charges four per cent on every hotel room stay to help promote and maintain local attractions and events.

The report coming to committee on Wednesday says if STA licensing is approved by council, staff will bring forward bylaw amendments to start collecting the tax on short-term rentals.

The report says regulations aren't an easy fix to the problems created by STAs.

It flags challenges with enforcing any rules. Namely that bylaw officers have to identify a unit being rented, prove the rental is happening on a short-term basis and figure out the duration of the rental. That's not easy when most online ads only list a general location, not a specific address.

"The fact that a location is advertised is not adequate evidence for a chance," the report says.

The report also recommends the city hold a public participation meeting to gather input on the proposed regulations.

In an online survey posted on the city's website, 80 per cent of the 811 people who responded said short-term rentals should be allowed. About 60 per cent of respondents in the same survey said they support some kind of regulations for short-term rentals.

A total of 35 per cent of respondents wanted short-term rentals to be limited to the owner's principal residence.