There’s no denying that adding an Airbnb to your investment portfolio can be hugely advantageous.
Canadian Airbnb hosts are profiting big time from their investments, earning roughly $7.1 billion (CAD) since 2010. For new hosts that want a piece of this revenue, it is crucial to consider what makes a great location for an Airbnb property.
In this article, we will discuss what to look for in an Airbnb property investment. Plus, we will dive into 7 of the best cities and towns in Canada to buy an Airbnb in.
What Makes an Area Good for Airbnb Investment?
As you hunt for the perfect Airbnb property, it is crucial to consider what factors make a property a great investment.
These factors include:
Always do your research into the current Airbnb market in a certain geographic area.
Most well-known towns and cities are likely to have an active Airbnb market, so don’t be immediately discouraged if you find a lot of listings. Instead, consider what holes in the market there may be – such as affordably-priced rentals or unique stays.
Even in highly competitive areas, you can find properties that can stand out.
Popular Attractions Nearby
It is important to consider the number of visitors and tourists a town or city receives each year – and a major indicator of how much to expect is by assessing the nearby popular attractions.
In Canada, for instance, many small towns are very close to major skiing destinations and ski resorts. This gives them a fantastic attraction for tourists who are looking for comfortable, small-town experiences to couple with their skiing adventures.
By looking at the popular nearby attractions, you can gain these types of insights about your potential future visitors.
When looking at properties to invest in, consider the seasonality of the rental. Ask yourself:
- Is this a property I could rent out year-round?
- What attractions or other factors affect the seasonality of this rental?
- If I plan to rent this property only during certain seasons, is there enough local tourism revenue to ensure this investment is profitable?
Considering the seasonality of your Airbnb is especially important in places like Canada, where the seasons can be drastically different in terms of weather and accessibility throughout the year.
Airbnb Laws and Regulations
When you are looking at potential property investments in different regions and cities, it is important to note that there will be varying legal regulations and requirements to adhere to.
The most important legal requirements to look for in a given town or city include:
- Business Licenses: Each individual city or town will have its own licensing standards, requiring you to get the proper local business license to operate an Airbnb property.
- Zoning By-laws: Many cities and towns have begun taking action to preserve their residential areas, introducing zoning by-laws that dictate where an Airbnb or other rental property can and cannot be located within the town or city limits.
- Operational Requirements: Each city or town will have its own set of short-term rental regulations that include a list of operational requirements. Always research these regulations before committing to purchasing a property.
Public Transport Accessibility
Many vacation rental visitors want the ability to easily get around the town or city they are visiting.
To make the most out of your Airbnb, try to find a property that is located close to public transport stations and stops. This can be a huge selling point for guests, especially if your property is located in a major city where they need to know how to easily get around.
Considerations for Buying an Airbnb in Canada
If you are thinking about buying an Airbnb property in Canada, it is essential to familiarize yourself with the Canadian laws and regulations for Airbnbs and other rentals.
Thankfully, the Airbnb Help Center offers a comprehensive webpage on Responsible Hosting in Canada, which includes key information, such as:
- National taxes
- Regulations and permissions
- Local and city-specific regulations (for Calgary, Edmonton, Kingston, Mississauga, Montréal, Nova Scotia, Ontario, Ottawa, Quebec, Regina, Saskatoon, Toronto, and Vancouver)
- Insurance and liability coverage
Pay special attention to the various differences in local regulation, as different cities can vary significantly in the strictness of their short-term rental property rules.
7 of the Best Places to Buy an Airbnb Property Canada
So, you are ready to take the leap and purchase an Airbnb property in Canada – but which city is best for starting your Airbnb venture?
Here are 7 of the best places in Canada to purchase an Airbnb:
1. Airbnb in Canmore
Tucked away in the Rocky Mountains of Alberta is the town of Canmore. This lovely location is a utopia for outdoors-lovers, situated just 20 minutes east of the famously renowned Banff National Park.
Banff National Park attracts more than 2.5 million visitors per year, bringing a whole lot of tourism traffic through and near Canmore – a town with a population of just under 14,000. This scenic destination is especially great for Airbnb owners with more rural or outdoorsy properties.
The biggest considerations for Airbnb owners in Canmore are the zoning laws and requirements. Tourist accommodations are not permitted in the majority of residential zones in Canmore, so Airbnb properties must be located within commercial and mixed-use districts, according to the Town of Canmore.
2. Airbnb in Whistler
Whistler is a scenic mountain and skiing destination situated north of Vancouver in British Columbia.
With consumers spending more than $1.5 billion in Whistler per year – as well as an average of 2.7 million unique visitors coming to Whistler each year – Whistler is a hot spot for adventure-seeking tourists.
From a business standpoint, to rent out an Airbnb property in Whistler, you must comply with the Tourist Accommodation Regulation Bylaw set forth by the Resort Municipality of Whistler. This regulation requires rental property owners to either:
- Work with a property management company covered by a business license
- Obtain their own business license for tourist accommodation
Additionally, Whistler has strict zoning regulations that prohibit property owners from marketing tourist accommodations in residential zoning areas.
3. Airbnb in Tofino
Located on Vancouver Island, Tofino is a beautiful small town best known for its idyllic natural scenery, including sprawling forests and lakes.
For a small island town, Tofino certainly knows how to attract a profitable tourist base. The tourism industry in Tofino is reported to bring in $240 million annually and roughly 600,000 visitors.
As a small town, local lawmakers are focused on keeping Airbnb rentals in check by requiring all Airbnb owners actively renting their properties to obtain a valid business license. Your property must also be correctly zoned.
4. Airbnb in Montréal
Montréal is one of the largest urban areas in Quebec and an incredibly popular travel destination for both Canadian and international visitors alike.
In 2019, Montréal attracted more than 11.1 million tourists and a total of more than 29 million visitors as a hub for both business and leisure. With an abundance of attractions – including more than 40 international museums and more than 4,900 acres of public parks – Montréal is a tourist’s delight.
Montréal is one of the local areas that Airbnb offers an official webpage for, including all the necessary legal requirements for operating an Airbnb in the city. These legal requirements include:
- Registration & a classification certificate
- Business licensing
- Adherence to zoning laws
- Quebec sales tax
5. Airbnb in Ottawa
Seated on the southern bank of the Ottawa River, Ottawa is the capital city of the great nation of Canada. As a mecca for Canadian culture and history, Ottawa is a must-see on the bucket lists of visitors from all around the globe.
With more than 11 million tourists visiting Ottawa each year – and bringing with them more than $2.2 billion in tourist revenue – the city is the perfect destination for aspiring Airbnb entrepreneurs.
For Airbnb owners in Ottawa, the main regulation to follow is the Short-Term Rental By-law that requires property owners to have a permit. There is a separate permit that must be obtained as well if the property qualifies as a “cottage rental.”
Learn more on the City of Ottawa’s website.
6. Airbnb in Victoria BC
Victoria – the capital city of British Columbia – is home to stunning architecture and unforgettable sight-seeing destinations. With more than 2,100 hours of sunshine each year, Victoria is an excellent location for visitors to enjoy the natural beauty of the city year-round.
7. Airbnb in Kimberley BC
A picturesque mountain town filled with outdoor adventures, the small city of Kimberly is an excellent travel destination in British Columbia.
Kimberly’s tourist industry is largely focused around its unique pedestrian centre – a car-free plaza known as the Platzl. Largely thanks to the popularity and commerce of the Platzl, Kimberly drew in $38.2 million in tourism revenue in 2021 alone.
To own and operate a short-term Airbnb rental in Kimberly, property owners must hold a valid license and adhere to Kimberly’s operational requirements. Learn more about operating an Airbnb in Kimberly with the City of Kimberly’s Short Term Rental Guidebook.
Canada is a beautiful country with countless scenic destinations that are perfect for Airbnb investments.
To make the most of your Canadian Airbnb, make sure you comply with all local legal regulations and have a good understanding of the tourism industry in your chosen town or city.