If you own an investment property in the Greater Toronto Area and are considering listing it on Airbnb, you've probably heard about the principal residence requirement. Here's what the rules actually say, what hosts are doing in practice, and your options.
The Principal Residence Rule
Most municipalities in the GTA have short-term rental regulations that include a principal residence requirement. On paper, this means:
That's what the bylaws say. But like many regulations, the reality on the ground is more nuanced.
What Hosts Are Actually Doing
We can't provide legal advice, and we're not suggesting anyone break rules. But here's what we're seeing across the GTA:
Some hosts claim principal residence
Some investment property owners register their property as their principal residence for STR purposes. They may spend time there, keep belongings there, or have mail delivered there. We can't advise on this approach — there are potential risks if the city investigates and determines the property isn't genuinely your primary home. This is a personal decision that some hosts make, but it's not something we can recommend or guide you on.
Enforcement varies widely
Different cities have different enforcement approaches. Some are complaint-driven, others are more proactive. Some hosts have operated for years without issues. Others have received notices. Things can change, and what works today may not work tomorrow.
Mid-term is the clean path
Many investors choose mid-term rentals (28+ days) because it's completely exempt from STR rules. No gray areas, no registration required, and strong demand from corporate travelers and relocations. This is the approach we can fully support.
We can't provide legal advice on residency claims. If you're considering registering an investment property as your principal residence, consult with a lawyer who understands municipal bylaws. What we can do is help you execute a mid-term rental strategy or manage your property once you've made your own decisions about registration.
GTA Cities & Their Rules
Here's a quick overview of how major GTA cities handle investment properties and short-term rentals:
| City | Principal Residence | Limits |
|---|---|---|
| Toronto | Principal residence required | 180 nights/year |
| Mississauga | Principal residence required | 180 days/year |
| Brampton | Principal residence required | 180 days/year |
| Oshawa | Principal residence required | 180 days/year |
| Caledon | Principal residence required | 180 nights/year + 300 cap |
| Vaughan | Principal residence required | No written limit* |
| Hamilton | Principal residence required | No written limit* |
| Oakville | Principal residence required | No written limit* |
Note: Regulations change frequently. Always verify current rules with your municipality before listing.
*Why "No written limit"? Vaughan, Hamilton, and Oakville don't specify a maximum number of nights in their bylaws like Toronto does. However, they all require principal residence — meaning you must ordinarily live there, keep your identification and documents at that address, and conduct your daily affairs from that home. While there's no explicit cap, we don't recommend exceeding 180 nights of short-term rentals per year. If you're away more than half the year, it becomes harder to demonstrate the property is genuinely your principal residence. The CRA and municipalities generally expect you to spend the majority of your time (183+ days) at your principal residence.
What Qualifies as Principal Residence?
To meet the principal residence requirement, your property typically must be:
Where You Live
The address on your driver's license, tax returns, and voter registration.
Your Primary Home
Where you spend most of your time and receive mail.
Documented
You'll need proof of residency when registering with the city.
Common documentation includes:
- Ontario driver's license with the property address
- Tax returns showing the address
- Utility bills in your name
- Bank statements
- Voter registration
Your Options for Investment Properties
Here are the paths investment property owners in the GTA are taking:
Short-Term with Registration
Some owners register the property and operate STRs. This can be the highest-earning option, but carries risk if residency is questioned. We can't advise on this path — consult a lawyer if considering it.
Mid-Term Rentals (30+ days)
Exempt from STR regulations entirely. Strong demand from corporate travelers and relocations. The "clean" path with no gray areas.
Corporate Housing
Furnished rentals for business travelers, often 1-6 months. Higher rates than unfurnished long-term, and listed on platforms like Furnished Finder.
Traditional Long-Term Rental
Standard 12-month leases provide stable, predictable income with less management overhead. Lower returns but lowest effort.
Mid-Term Rental Strategy
Mid-term rentals (30+ days) offer a compelling middle ground for investment property owners:
- Exempt from most STR regulations
- Higher rates than traditional long-term leases
- Less turnover than short-term rentals
- Still listed on Airbnb, VRBO, and Furnished Finder
- Attracts quality tenants (business travelers, relocations)
Many property owners find mid-term rentals provide 20-50% higher returns than traditional long-term leases while avoiding the regulatory complexities of short-term rentals.
Who Rents Mid-Term?
- Corporate employees on temporary assignments
- Healthcare professionals on contracts
- Families relocating to the GTA
- Students doing internships or co-op terms
- People between homes during renovations or sales
- Snowbirds needing a base for part of the year
Frequently Asked Questions
Can I rent my investment condo on Airbnb in Toronto?
Toronto's bylaws require short-term rentals to be your principal residence, which rules out most investment properties. We can't give legal advice, but mid-term rentals (28+ days) are a great alternative that's exempt from these rules.
What if my condo allows short-term rentals?
Even if your condo corporation permits STRs, city bylaws still apply. Some hosts operate anyway, while others stick to mid-term rentals for a cleaner approach.
Are there any cities in the GTA without the principal residence rule?
A few areas like King Township, Ajax, and Pickering don't have specific STR bylaws yet. Richmond Hill also has no restrictions currently, though the city is studying regulation. Others have varying enforcement levels. Regulations are always changing, so check your specific municipality.
Can I do mid-term rentals on an investment property?
Yes! Rentals of 28-30+ days are exempt from most STR regulations in the GTA. Many investors use mid-term rentals for corporate housing, relocations, and extended stays. This is often the easiest path.
What are hosts actually doing with investment properties?
Some hosts claim the property as their principal residence, though this carries risk if investigated. Others focus on mid-term rentals, which are fully compliant since they're exempt from STR rules. We can only advise on compliant strategies like mid-term rentals.
Ready to Put Your Investment Property to Work?
Nurture manages short-term and mid-term rentals across the Greater Toronto Area. If your investment property doesn't qualify for STR, we can help you set up a mid-term rental that earns more than a traditional lease.
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