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Calgary Short Term Rental Regulation: A Guide For Airbnb Hosts

Calgary, Canada

What are short term rental (Airbnb, VRBO) regulations in Calgary,Canada?

The City of Calgary defines a short-term rental (STR) as the business of providing temporary accommodation for compensation in a dwelling unit or portion of a dwelling unit for periods of up to 30 consecutive days11. STRs are often operated by property owners or management companies, with transactions usually completed between hosts and guests through online platforms like Airbnb, VRBO, HomeAway and Flipkey5.

As of June 2023, there were over 4,000 licensed STRs in Calgary, with the industry projected to continue growing steadily6. Most of Calgary's Airbnbs are located in the city center next to major tourist attractions, with an average occupancy rate of 71%12.

Starting a Short Term Rental Business in Calgary

The City of Calgary defines a short-term rental (STR) as the business of providing temporary accommodation for compensation in a dwelling unit or portion of a dwelling unit for periods of up to 30 consecutive days11. STRs are often operated by property owners or management companies, with transactions usually completed between hosts and guests through online platforms like Airbnb, VRBO, HomeAway and Flipkey5.

As of June 2023, there were over 4,000 licensed STRs in Calgary, with the industry projected to continue growing steadily616. Most of Calgary's Airbnbs are located in the city center next to major tourist attractions, with an average occupancy rate of 71%12. The STR market presents a lucrative opportunity for property owners looking to generate additional income.

However, starting an STR business in Calgary requires careful planning and adherence to local regulations. Conducting thorough market research is essential to determine if there is sufficient demand for STRs in your desired location and to identify opportunities to offer a unique and competitive rental property18.

Choosing the right neighborhood is crucial, considering factors like safety, walkability, proximity to amenities, and accessibility to popular attractions and public transportation18. Making your rental property stand out with high-quality furnishings, unique amenities, and excellent customer service can give you a competitive edge18.

It's critical to familiarize yourself with Calgary's legal requirements for operating an STR. The city has a two-tier licensing system, with fees ranging from $100 to $172 per property, plus additional costs for fire inspections219. Hosts must obtain a valid business license, comply with safety regulations, maintain guest records, and include their license number in any advertising19.

Effective January 1, 2024, additional requirements will come into effect, including obtaining written consent from property owners and condo boards, providing a fire safety plan and undergoing fire inspections, securing proper insurance coverage, and allowing the city to review the property for any prior concerns614.

Setting reasonable and competitive pricing is another key factor. Researching what other properties in your area charge and finding the right balance between profitability and competitiveness is essential18. Calgary's average daily STR rate is $160, with the potential to reach $224 during peak months, and an average occupancy rate of 63%13.

Developing an effective marketing strategy, creating appealing listings on platforms like Airbnb and VRBO, and delivering exceptional guest experiences to earn positive reviews are all vital for success18. Utilizing technology solutions for property management, cleaning, and regulatory compliance can streamline operations13.

While Calgary is relatively STR-friendly compared to some other major cities4910, it's important to stay informed about evolving regulations and bylaw changes. The city aims to balance the economic benefits of STRs with minimizing community impacts and ensuring guest safety16.

Building a strong reputation, being prepared for challenges like unexpected maintenance issues or low occupancy periods, and having a backup plan are all part of running a successful STR business18. With the right approach, mindset, and commitment to compliance and customer service, Calgary offers a rewarding opportunity for STR entrepreneurs.

Short Term Rental Licensing Requirements in Calgary

To legally operate an STR in Calgary, all current and prospective hosts must obtain a valid business license from the city6111519. The licensing process aims to ensure consumer protection for guests, transparency between hosts and guests, and reduced community impacts19.

Calgary has implemented a two-tier licensing system219:

  • Tier 1 License: For hosts offering 1 to 4 rooms for rent, accommodating up to 8 guests (not including minors under 12). The license fee is $100 per property.
  • Tier 2 License: For hosts offering 5 or more rooms for rent. The license fee is $172 per property, plus a mandatory fire inspection costing $104.

Licenses must be renewed annually and can be applied for online through the Short-Term Rental Business License Portal or in-person at the Calgary Planning Service Centre1519.

Effective January 1, 2024, additional licensing requirements will be introduced to enhance accountability, safety, and community impact16. These include:

  • Proof of property owner's consent for the STR to be offered to guests for compensation
  • Written approval from the condo board, if applicable, confirming the STR is permitted
  • A fire safety plan, including a floor plan of the dwelling unit, location of smoke alarms, fire extinguishers, and exits
  • A fire inspection to validate safety standards and allowable number of guests
  • Proof of liability insurance coverage for the STR
  • A review of the property for any prior concerns

Failing to comply with licensing and operating regulations can result in fines of $1,000 for each offense upon conviction219. The city's approach is to work with hosts to achieve voluntary compliance whenever possible before resorting to penalties211.

Required Documents for Calgary Short Term Rentals

When applying for or renewing an STR business license in Calgary, hosts will need to provide several key documents to demonstrate compliance with local regulations61419. As of January 1, 2024, the following will be required:

Proof of Property Ownership or Consent:

  • Validation of property ownership through a title search conducted by the city or a land title provided at application
  • If the host is not the property owner, written consent from the owner authorizing the STR to be offered to guests for compensation

Condo Board Approval (if applicable):

  • For STRs located in condominiums, written proof from the condo board confirming the STR is permitted
  • Documentation must include the condo board's seal

Fire Safety Plan:

  • A detailed floor plan of the dwelling unit or portion offered for rent, clearly indicating:
  • All rooms and floors accessible for rent, including bedrooms and living spaces used for sleeping
  • Location of smoke alarms, fire extinguishers, and fire exits

Liability Insurance:

  • Proof of insurance coverage specifically for home-sharing or STR use
  • The STR license applicant must be the insurance policy holder
  • For property management companies, proof of their liability insurance is required
  • Insurance must be issued by a company registered to do business in Alberta (a list of approved companies is available)
  • Minimum liability coverage of $2 million

License Inspector Review:

  • The property will undergo a review by the city's License Inspector to assess any prior concerns and ensure compliance with regulations

In addition to these documents, Tier 2 license applicants will need to schedule a mandatory fire inspection conducted by the Calgary Fire Department to verify adherence to life safety requirements19.

Gathering and submitting all necessary documentation is crucial for a smooth and successful licensing process. The city encourages both current and prospective hosts to familiarize themselves with the application requirements and prepare well in advance of the January 1, 2024 implementation date16.

By ensuring all required documents are in order, STR operators demonstrate their commitment to guest safety, community responsibility, and regulatory compliance - key factors in building a thriving and sustainable STR business in Calgary.

Calgary Short Term Rental Taxes

As the STR industry continues to grow in Calgary, the topic of taxation has come to the forefront. While the city has not yet implemented a specific tax regime for STRs, changes are on the horizon.

The province of Alberta has announced plans to introduce a tourism levy that would require STR hosts to collect a percentage of the accommodation fee from guests15. This levy, similar to a hotel tax, aims to generate revenue for tourism promotion and development initiatives.

However, as of March 2024, the tourism levy is not yet in effect for STRs in Calgary or the rest of Alberta15. The provincial government is expected to provide more information and guidance on the implementation process in the coming months.

It's important to note that income earned from STRs is still subject to federal and provincial income taxes3. The Canada Revenue Agency (CRA) classifies STR income as business income, which means hosts must report all earnings and pay the applicable taxes3.

Calgary STR hosts who are residents of the city will need to report their rental income on their T1 Personal Income Tax Return, while non-resident hosts will file a T1-NR Non-Resident Income Tax Return3. Hosts can deduct eligible expenses related to their STR business, such as maintenance, utilities, insurance, and property taxes, to calculate their taxable income3.

Failure to report STR income or pay the required taxes can result in penalties and interest charges from the CRA3. The penalty amount depends on the tax owed and the length of the delay in filing, potentially reaching up to 50% of the unpaid tax3.

To minimize their tax liability, Calgary STR hosts should keep detailed records of all income and expenses related to their rental property3. Consulting with a tax professional familiar with the STR industry can also help ensure compliance and optimize tax planning strategies.

As the regulatory landscape evolves, it's crucial for Calgary STR operators to stay informed about any new tax requirements implemented at the municipal or provincial level. Regularly reviewing official sources, such as the City of Calgary and Government of Alberta websites, can help hosts stay up-to-date with the latest tax obligations for their STR business.

By understanding and fulfilling their tax responsibilities, Calgary STR hosts can maintain compliance, avoid penalties, and contribute to the overall economic well-being of the city and province.

Calgary-wide Short Term Rental Rules

In addition to obtaining a valid business license and complying with tax requirements, Calgary STR hosts must adhere to several city-wide regulations outlined in the Business License Bylaw21119. These rules are designed to ensure guest safety, minimize community impact, and maintain a fair and well-regulated STR market.

Egress Requirements19:

  • Hosts cannot rent a room that does not have one or more egress windows, except in multi-story apartment or condo buildings where existing fire safety standards are in place
  • This rule ensures guests can safely evacuate in case of an emergency

Occupancy Limits21119:

  • No more than 2 adults (not including minors) are allowed per room
  • This regulation addresses overcrowding and safety concerns

Overlapping Bookings21119:

  • Hosts are prohibited from scheduling overlapping bookings where separate rooms are rented to different guests under separate reservations
  • However, multiple rooms can be rented together as part of a single reservation

Advertising Requirements21119:

  • Hosts must include their STR business license number in any advertising or listing for their rental property
  • This measure helps prevent unlicensed operators and informs guests that the property is licensed and compliant

Emergency Contact Information21119:

  • The name, phone number, and email address of a 24/7 emergency contact person must be prominently displayed in the rental property
  • This allows guests and enforcement authorities to quickly address any issues that may arise

Guest Records21119:

  • Hosts must keep an electronic record in English of each booking, including the full name and email address of each paying guest, along with their length of stay
  • These records must be provided to the License Inspector upon request to ensure transparency and compliance

Failure to comply with any of these regulations can result in fines of $1,000 for each offense upon conviction219. The city's primary approach is to work with hosts to achieve voluntary compliance, providing education and guidance to help operators understand and follow the rules211.

Calgary STR hosts should familiarize themselves with these city-wide regulations and implement the necessary measures to ensure their properties are fully compliant. This includes installing proper egress windows, setting appropriate occupancy limits, avoiding overlapping bookings, displaying license numbers in advertisements, posting emergency contact information, and maintaining detailed guest records.

By adhering to these rules, Calgary STR operators demonstrate their commitment to providing safe, responsible, and well-managed accommodations for guests while being good neighbors and contributing positively to the local community.

Does Calgary Strictly Enforce STR Rules?

When it comes to enforcing STR regulations, Calgary takes a balanced approach that prioritizes education, collaboration, and voluntary compliance211. While the city has specific rules in place for STRs, the level of enforcement is not considered extremely strict compared to some other major cities4910.

Calgary's STR enforcement strategy focuses on working with hosts to help them understand and follow the regulations whenever possible211. The city provides resources, guidance, and support to assist operators in achieving compliance, rather than immediately resorting to penalties or fines211.

Many hosts have successfully operated STRs in Calgary without facing major issues, as long as they obtain the proper licensing, adhere to the city-wide rules, and maintain open communication with the authorities410. This collaborative approach has contributed to Calgary's reputation as a relatively STR-friendly city4910.

However, it's important to note that with the upcoming bylaw changes set to take effect on January 1, 2024, Calgary is aiming to strengthen accountability for hosts and minimize negative community impacts6

How to Start a Short Term Rental Business in Calgary

Starting a short-term rental (STR) business in Calgary can be a lucrative venture, but it requires careful planning, compliance with regulations, and a commitment to providing exceptional guest experiences. Here's a step-by-step guide to help you get started:

Understand the legal requirements:

  • Familiarize yourself with Calgary's STR regulations, including the Business Licence Bylaw and any zoning restrictions18.
  • As of January 1, 2024, additional requirements will be in effect, such as obtaining written consent from property owners and condo boards, providing a fire safety plan, undergoing fire inspections, securing proper insurance coverage, and allowing the city to review the property for any prior concerns614.

Obtain necessary permits and licenses:

  • Apply for the appropriate STR business license (Tier 1 for 1-4 rooms, Tier 2 for 5+ rooms) from the City of Calgary18.
  • Submit all required documentation, including proof of ownership/consent, condo board approval (if applicable), fire safety plan, liability insurance, and pay the license fee614.
  • For Tier 2 licenses, schedule the mandatory fire inspection18.

Prepare your property:

  • Ensure your property meets all safety requirements, such as egress windows, smoke alarms, fire extinguishers18.
  • Create a welcoming and well-equipped space with quality furnishings, amenities, and local touches1.
  • Develop a cleaning and maintenance plan to keep the property in top condition between guests1.

Create your listing:

  • Take high-quality photos and write an engaging, accurate description of your property1.
  • Highlight unique selling points, local attractions, and amenities.
  • Set competitive rates based on market research and your target audience13.
  • List your property on platforms like Airbnb and VRBO, including your business license number18.

Establish operational systems:

  • Implement a reliable booking and reservation management system1.
  • Automate guest communication, check-in instructions, and house rules where possible.
  • Arrange for professional cleaning and maintenance services1.
  • Keep detailed records of all transactions, guest information, and compliance documents18.

Promote your listing and deliver excellent guest experiences:

  • Utilize the platforms' promotional tools and consider additional marketing channels1.
  • Communicate promptly and professionally with guests before, during, and after their stay.
  • Provide helpful local recommendations and thoughtful touches to enhance guest satisfaction1.
  • Encourage guests to leave reviews and maintain a high rating.

Stay informed and adapt to changes:

  • Monitor your performance metrics, guest feedback, and occupancy rates13.
  • Stay up-to-date with any changes to Calgary's STR regulations and bylaws614.
  • Join local host communities and attend industry events to network and share best practices5.

By following these steps, conducting thorough research, and prioritizing compliance and guest satisfaction, you can build a successful STR business in Calgary. However, it's essential to understand that the STR market is dynamic and competitive, so adaptability and a commitment to continuous improvement are key to long-term success.

Who to Contact in Calgary about Short Term Rental Regulations and Zoning

When navigating the complex world of short-term rental regulations and zoning in Calgary, it's essential to know who to contact for accurate information and guidance. Here are the key resources:

City of Calgary's Planning Services Centre18:

  • For questions about the STR licensing process, requirements, and bylaw compliance.
  • Phone: 403-268-5311
  • Email: [email protected]

City of Calgary's Development and Building Approvals18:

Short-Term Rental Business License Portal15:

Calgary Fire Department19:

  • For information about fire safety requirements, inspections, and compliance for STRs.
  • Phone: 403-268-8742
  • Email: [email protected]

Alberta Health Services (AHS)13:

Alberta Tourism and Tourism Levy15:

  • For updates on the implementation of the provincial tourism levy on STRs.
  • Phone: 780-427-3044
  • Email: [email protected]

In addition to these official sources, connecting with local host communities and industry associations can provide valuable insights and support:

Airbnb Host Community - Calgary10:

Calgary Hotel Association13:

  • An industry organization that advocates for fair and balanced STR regulations and provides resources for hosts.
  • Phone: 403-265-3400
  • Web: https://www.calgaryhotels.org/

By proactively reaching out to these contacts and staying engaged with the local STR community, hosts can ensure they have the most current and accurate information to operate their businesses successfully and compliantly in Calgary.

What do Airbnb hosts in Calgary on Reddit and Bigger Pockets think about local regulations?

Discussions about Calgary's short-term rental regulations on platforms like Reddit and Bigger Pockets reveal a range of perspectives among Airbnb hosts and real estate investors. Here's a summary of some key themes:

Impact on housing affordability and availability79:

  • Some hosts express concerns that the growth of STRs is contributing to rising rents and reducing the supply of long-term housing for residents.
  • Others argue that many Calgary Airbnbs are operated out of primary residences, so they likely wouldn't otherwise be available as long-term rentals12.

Reasonableness of regulations410:

  • Many Calgary hosts on Bigger Pockets feel the city's STR regulations are relatively reasonable and not overly restrictive compared to other major cities410.
  • They appreciate that the city takes an approach of working with hosts to achieve voluntary compliance before resorting to fines11.
  • However, some hosts express frustration with the licensing costs, paperwork, and potential for increased enforcement10.

Profitability and investment potential414:

  • Despite the regulations, many Calgary hosts report operating STRs profitably, with good demand and occupancy rates4.
  • The city is seen as a decent market to invest in STR properties, especially compared to more restrictive cities like Toronto or Vancouver4910.
  • However, hosts caution that thorough research, realistic expectations, and careful property selection are essential for success14.

Condo and community restrictions1415:

  • Hosts note that many Calgary condos and homeowners' associations have rules against or restricting STRs, which can limit investment opportunities1415.
  • Some hosts report challenges with neighbors complaining or buildings strictly enforcing no-STR policies15.

Uncertainty around future changes10:

  • With the new bylaw changes coming into effect in January 2024, some hosts are concerned about how the added requirements may impact their businesses10.
  • They are waiting to see how the regulations will be enforced and whether compliance will become more challenging or costly.

Responsible hosting and community impact811:

  • Many Calgary hosts emphasize the importance of being responsible operators, following the rules, and minimizing negative impacts on neighbors and communities11.
  • They recognize that the STR industry's reputation depends on hosts acting ethically and working to address legitimate concerns8.

Overall, while there are diverse opinions among Calgary Airbnb hosts, there seems to be a general sentiment that the city's regulations are manageable and that opportunities exist for responsible STR operators. However, hosts also acknowledge the need to stay informed, adapt to changes, and balance their business interests with the well-being of the wider community.

By engaging in these online forums and learning from the experiences of fellow hosts, aspiring STR entrepreneurs can gain valuable insights into the realities of operating in Calgary and make more informed decisions about their own ventures.

Reveal your property’s rental profitability

Buy this property and list it on Airbnb.