Short-term rentals: know what is and isn't allowed

In major metropolitans across Canada, it is very tempting to hop on the short-term rental bandwagon. Whether you own the property or rent it, there can be many bonuses as well as headaches that go along with short-term rentals.

With the Pan-Am Games that just went down, many Torontonians were cashing in on renting out rooms in their homes. As you can imagine, short-term rentals are a major pain to the hospitality industry, and because of that, in many cities the government is cracking down. In places like New York and the province of Quebec, it is illegal to rent your place for less than 30 days. However, there are no laws prohibiting short-term rentals in Ontario, or the rest of the country – yet.

If you own the property, the only thing you need to worry about is insurance (and perhaps the idea of a stranger sleeping in your bed and rifling through your things!). Many insurance companies don’t want the headache of covering short-term rentals, which means you’ll need to find a speciality insurance company (like those used to insure strip clubs).

If you’re a renter, then it’s a whole other story. Technically, short-term rental isn’t illegal anywhere in Canada, other than Quebec. That being said, you still need to get your landlord’s approval. As per the Ontario Tenant’s Act, a landlord has every right to evict you if you sublet without consent (act s.100).

Another important thing to remember, as per act s.134(3), you can’t charge a subletter more than your monthly rent. So if you’re thinking about renting out your living room during the Pan Am Games, make sure the total amount charged doesn’t exceed your monthly rent.

As in all things, it’s better to ask questions first. Talk to your landlord, your roommate, your condo board, and your insurance broker before jumping into any new business venture!