These Hamilton tenants say their units are in disrepair while Airbnb guests fill up the building

On wet days in east Hamilton, Melissa Gudgeon says a stream of water runs from the bottom corner of her bedroom window, down the wall and across the floor, pooling by the door.

In the bathroom, black mould blooms across the ceiling, moisture bubbling and peeling the paint.

Gudgeon said since 2019, she's pushed her current landlord to fix these issues in her two-bedroom apartment she shares with her teenage daughter. She thinks new windows, a new bathtub and maybe even a ventilation fan would make all the difference.

But the repairs have never been done, Gudgeon said.

"We don't really matter," she said. "The Airbnbs are what matter."

She's one of three tenants who told CBC Hamilton their apartments at 2322 King St. E are in need of repairs and maintenance but the work goes undone while their landlord renovates empty units that are then listed on Airbnb. Two of the tenants requested their names be withheld, saying theyfearedrepercussions from the landlord.

They said it's a process that's unfolded close to a dozen times over the last four years: A neighbour moves out or dies. Their unit is renovated with laminate floors, upgraded kitchen appliances and bathrooms, dark wood cupboards and fresh paint. Within a month or so the units are listed on Airbnb for significantly more money.

In a phone interview, landlord Beni Colalillo, who, according to property records, bought the 50-year-old building in 2018, said he has "nothing to do" with the units listed on Airbnb, sayingthey're rented out by other tenants. He confirmed he renovated the units.

He denied the allegation that he is neglecting repairs in units like Gudgeon's, saying he does regular maintenance and is responsive to tenants' needs.

Paralegal Kimberely Farrell, who is representing Gudgeon and several other tenants at the Landlord and Tenant Board (LTB), described their situation as a "nightmare."

"Most of the tenants have some medical conditions, mental health conditions that are being exacerbated tremendously by the landlord," Farrell said.

"[Colalillo] refuses to do proper maintenance in their units because he thinks that they're going to be out."

Airbnb unitrents out for $2,400 a month

CBC Hamilton found 10 different Airbnb listings that match the location and appearance of the five-storey, 22-unit building, and were available to rent almost every day into 2024. After Colalillo was interviewed for this story, most of the listings appeared to have been removed from the website.

The units previously posted on Airbnb cost between $51 and $80 per night, or up to $2,400 a month more than triple what Gudgeon said she currently pays for her unit she's lived in for 12 years.

"I don't want to be removed from my home," Gudgeon said. "It shouldn't be for Airbnbs. It should be for residents."

The building is heavily surveilled, with security cameras installed in hallway corners, a tall fence around the back of the parking lot and the front door locked so tenants can't rely on the buzzer system inside the foyer.

Colalillo said the measures are to deter "drug addicts and homeless people" from entering his property and to keep tenants safe.

"I don't want any trouble," said Colalillo,who added he is a "good guy."

'Exactly' what new bylaw is trying to limit: councillor

The vacancy rate in Hamilton for purpose-built rentals is the lowest in 20 years at 1.9 per cent, reported the Canada Housing and Mortgage Corporation in January.

Rent prices are soaring. A two-bedroom apartment in the city on average costs $2,145 a month, up more than 15 per cent year over year, according to a recent Rentals.ca report.

Short-term rentals contribute to "worsening housing affordability and availability," said McGill University Prof. David Wachsmuth, an expert on the impacts short-term renting platforms have on cities around the world.

His research indicates there's more than 1,000 entire homes listed on short-term rental sites like Airbnb in Hamilton more than the estimated 860 vacant units currently available on the long-term market.

Last month Hamilton city council passed a new bylaw that will make it illegal for people to rent out properties short-term if they don't actually live there. That includes commercial operators with multiple units listed on Airbnb.

The city will begin enforcing the bylaw in June in the hopes it will put more units back in the long-term market and help ease the housing affordability crisis.

Wachsmuth said he expects when the bylaw comes into effect units will flood the rental market, as long as the city is committed to enforcing the new rules.

"It will contribute positively to a new, lower equilibrium for rent," Wachsmuth said.

Coun. Tammy Hwang, who represents Ward 4 where 2322 King St. E is located, said she's aware of the situation and it demonstrates why short-term regulations are necessary to ensure residents have access to safe housing.

"Just letting things go to disrepair just so they're forced to leave is not a 'housing is a right' mentality," Hwang said. "It's exactly what the short-term rental bylaw is trying to limit that level of behaviour."

Landlord has applied to evict tenants through tribunal

Colalillo said he's not concerned about the city's bylaw.

"If Hamilton wants to bring it in, go ahead," he said. "I have nothing to do with it."

The units in his building were listed on Airbnb by one of two different hosts named David or Derek and Debra whose profiles begin the same way: "We are thrilled to welcome guests from around the world to share our homes and our love of the surrounding area."

When contacted for this story, both responded with identical messages.

"Thanks for your interest in our home. Just give me a few moments and I'll respond momentarily. :)." Neither account did.

Colalillo said his tenants must have hired the same property management company to rent out their units while they're away on vacation.

Airbnb lists the hosts as "verified," which means the company may have confirmed their identities by requesting their legal names and addresses and/or government ID and checking third-party databases, according to the website.

Gudgeon lives next to one of these units. While she's had to bang on the door many times in the middle of the night to ask the occupants to be quiet, she said she's never met or spoken to anyone who claims to be a long-term renter who may be listing their apartment online.

"There's no way," she said. "How are they on vacation all year round?"

Colalillo says he has two applications at the LTB for the King Street Eastbuilding, to increase rent and to end tenancies in order to do renovations, both of which have been delayed.

The board is facing a huge backlog of cases after proceedings were paused during the pandemic.

The first application to increase rent three per cent dating back to 2020, which is above the province's guideline of 2.2 per cent for that year.

Colalillo said he needs the extra income to keep up with repairs like replacing windows and doors. He said he'salready spent millions of dollars to get the building "up to snuff" including installing cameras, repainting balconies, replacing the roof and hallway carpet and renovating units when they become vacant.

"It's frustrating because as a landlord I'm handcuffed when we've got inflation that's causing massive price increases," said Colalillo.

Farrell, the paralegal representing some of the tenants at the LTB, said she is working on both cases. CBC Hamilton has seen the notices provided to tenants as a result of the applications.

The second application is to end tenancies in at least seven units including Gudgeon's unit. Colalillo said he needs them out so he can do "a complete gut," although he would not specify what work needs to be done and why tenants need to permanently leave.

When asked about black mould in Gudgeon's unit, which CBC Hamilton has seen, Colalillo said he has "no knowledge of it" and said some tenants have an ulterior motive to make him seem like a "schmuck."

He said if there is mould in a unit it's because some tenants are "dirty pigs" and it's not his job to clean it up.

However, landlords are responsible for keeping interior walls and ceilings free from mould and other fungi, according to the Residential Tenancies Act.

Extensive patches may require a professional to clean up and can indicate a larger moisture problem, said Health Canada's website. People who live in homes with mould and damp conditions are more likely to have eye, nose and throat irritation among other symptoms.

The city said it has received six complaints about conditions in the building between 2019 and 2022, but no tickets were issued to the building's owner.