British ColumbiaSince 2024, new provincial regulations have restricted short-term rentals to principal residences, but municipalities can request an exemption if their vacancy rate reaches three per cent or higher for two consecutive years. City will request early consideration to have new regulations take effect by May in time for tourism seasonMichelle Gomez · CBC News · Posted: Nov 04, 2025 5:59 PM EST | Last Updated: November 4Listen to this articleEstimated 3 minutesKelowna city council voted Monday to request an exemption from the province’s short-term rental restrictions. (Thomas Popyk/CBC)The city of Kelowna could see relaxed short-term rental rules amid an increasing vacancy rate. Since May 2024, new provincial regulations have restricted short-term rentals to principal residences, a secondary suite, or a structure like a laneway house on the property. But Kelowna city council voted Monday to proceed with requesting an exemption, which municipalities can do if their vacancy rate reaches three per cent or higher for two consecutive years. Kelowna’s vacancy rate reached 3.8 per cent at the end of 2024, and is currently estimated at over five per cent, according to a report from the city, up from 1.2 per cent in 2023. There was debate at Monday’s council meeting as Coun. Luke Stack pointed out that having a rising vacancy rate could allow rental prices to decrease.“It’s so important that we don’t undermine the fact that we’re now getting a reasonable vacancy rate … some of the costs will eventually come down on some of our rental properties,” said Stack. “It’s been a crisis for so long.” Nola Kilmartin, Kelowna’s chief planner, said the new rules would not allow a free-for-all on short-term rentals in the city, but would ease restrictions for some cases. The strategy presented to city council would allow short-term rentals in larger buildings that had been approved for short-term rentals prior to 2024, and with permission from the building’s strata. “Before it was a bit of government whiplash. We went completely banning something outright from allowing it pretty broadly before. This is more of a middle-road line,” Kilmartin said on CBC’s Daybreak South. Kilmartin said the city is hoping this cautious approach will be a win-win. “It took a very long time for us to get out of a chronically low vacancy rate, our prices were out of control,” she said. “There needs to be some guardrails around how we approach this.”Heather Harps invested in two short-term rental properties in Kelowna before the 2024 restrictions were announced. One of her units is a micro-suite located in the waterfront Aqua building, which had been zoned for short-term rentals before the new provincial regulations came into play. She says it has been difficult to fill the 320-square-foot unit with a long-term tenant as it was built for short-term use. She says she has been paying the mortgage mostly out of pocket. Harps is hopeful that restrictions will be eased in her building. “It has really been a ride over the last couple years,” said Harps. “We expected some risk, but certainly not this.”Kilmartin said while the provincial timeline would allow the change to be in place by November 2026 at the earliest, the city will request early consideration to have the new regulations take effect by May in time for tourism season. She says cabinet would need to pass a motion for early consideration. ABOUT THE AUTHORMichelle Gomez is a writer and reporter at CBC Vancouver. You can contact her at michelle.gomez@cbc.ca. With files from Daybreak South
Kelowna looks to ease short-term rental rules amid a higher vacancy rate
