Across Canada, short-term rentals (STRs) make up only a small part of the overall housing stock. According to Statistics Canada, in 2023, properties that could serve as long-term homes but were instead used predominantly for short-term stays amounted to less than 1% of Canada’s 15.5 million housing units. Despite this, public attention often focuses on these listings as a primary driver of rising rents and dwindling availability.

Although maintaining affordable housing is a critical issue, and the rise of short-term rentals may cause concern, the limited number of units they potentially remove from the long-term market indicates they are not the primary culprit. As Canada’s housing crisis persists, questions about the more critical causes, and the role, or lack thereof, that short-term rentals play, are being raised.

Why Owners Choose Short-Term Over Long-Term Rental Models

Many property owners cite higher income potential and more flexible arrangements as key reasons for favouring short-term rentals. Revenue from a well-managed short-term rental unit can exceed long-term leases by two to three times during peak seasons, even after accounting for added cleaning, furnishing and platform fees. Moreover, quick guest turnovers reduce the risk of prolonged legal entanglements. Unlike traditional tenancies, where disputes can drag through tribunals for months or even years, short-term hosts reset relations with each new booking, avoiding a backlog of eviction or rent-arrears cases that sometimes leaves long-term landlords absorbing huge losses.

Supplemental income is another draw. Many STRs are homeowners’ primary residences rented out part of the year to offset mortgage and maintenance costs. Others still rent out a portion of their home as an STR while they live there full-time. In these cases, the property is not truly available for long-term rental, regardless of STR policies.

Misplaced Blame and the Bigger Picture

Despite being a small portion of the national supply, short-term rentals can sometimes shoulder an outsized portion of the blame in media and policy discussions. Multiple analyses find no strong link between STR activity and aggregate rent increases. A 2023 Conference Board of Canada report concluded there is “no compelling evidence” that Airbnb-style listings have driven up housing costs. In fact, many units listed short-term would never have entered the long-term market, such as vacation homes, snowbird properties, student accommodations and other such properties.

Policies targeting these listings often risk penalizing small-scale hosts rather than addressing underbuilding, zoning delays and demographic pressures. The narrative that short-term rentals alone fuel affordability issues overlooks the more significant supply-side constraints: Canada needs millions of additional homes by 2030 in order to meet demand and population growth, as acknowledged by federal and provincial agencies alike.

STRs Support Local Economies

Many STR landlords are local entrepreneurs who reinvest earnings into their properties and their communities. They also pay municipal and tourism taxes, which help support public transit, parks, and other services. STRs additionally sustain a web of small businesses: cleaners, maintenance contractors, local managers and suppliers. By keeping revenue within neighbourhoods rather than funnelling it to multinational hotel chains, these hosts help preserve local character and livelihoods.

Local Variations and Context

While national averages remain low, it is important to note that certain communities may see sharper impacts. Canmore, Alberta, reported at least 15% of its housing stock used for short-term rental, reflecting its tourism-driven market. On the other hand, cities with diverse housing stock and robust vacancy rates show almost no distortion from short-term activity.

Client Advocates

Understanding both long- and short-term trends is crucial to crafting tailored strategies for clients. Real estate professionals can use these insights to inform client conversations, particularly with investor clients. Real estate professionals should also be sensitive to public perceptions around these trends.

RLP InvestorsEdge™ agents at Royal LePage® bring specialized expertise and a clear understanding of the Canadian investment real estate trends. They deliver professional, investor‑focused advice. A critical reason for their expertise and knowledge is the comprehensive RLP InvestorsEdge™ Master Class. Real estate professionals interested in helping investors while driving their careers forward can learn more about the RLP InvestorsEdge™ program here.