London is Ontario's largest city outside the GTA, home to Western University's 40,000+ students and a growing tech sector. That creates year-round STR demand from visiting parents, academics, and professionals.
The city regulates short-term rentals through Schedule 21 of their Business Licensing By-law (L.-131-16), effective October 2022. It's a comprehensive framework with strict requirements including criminal background checks. Here's everything you need to know.
What Counts as a Short-Term Rental?
London's definition is clear and specific:
"Short-term Accommodation means a temporary accommodation in all or part of a Dwelling that is provided for 29 consecutive days or less in exchange for payment including a bed and breakfast, but not including a hotel, motel, inn, resort, hostel, lodging house or rooming house." London By-law L.-131-16, Schedule 21 § 1.0
Key elements of this definition:
- 29 days or less - one day shorter than most Ontario cities (30 days)
- In exchange for payment - free stays aren't regulated
- Includes B&Bs - traditional bed and breakfasts fall under STR rules
- Excludes commercial hospitality - hotels, motels, hostels have separate rules
The Resident Address Requirement
London takes a strict approach to ensuring STRs are in primary homes:
"Resident Address means the place at which an individual habitually sleeps, eats, keeps their personal effects, and has a regular place of lodging; an individual may have only one Resident Address." London By-law L.-131-16, Schedule 21 § 1.0
The application requires:
- Sworn declaration that the STR address is your Resident Address
- Government-issued ID showing your Resident Address
- Attestation that you're an individual (corporations cannot be STR providers)
Corporations Cannot Be STR Providers
London explicitly requires STR providers to be individuals, not corporations or partnerships. The by-law states the provider "does not include a corporation or partnership." If you hold property through a corporation, you cannot operate it as an STR. This is stricter than many Ontario municipalities.
License Requirements
London has one of the more demanding application processes in Ontario:
Application Requirements
- Sworn declaration that you're 18+, an individual, and the address is your Resident Address
- Government-issued ID with photo showing your Resident Address
- Criminal Record and Judicial Matters Check (CRJMC) dated within 90 days
- Proof of ownership if you own the dwelling
- Landlord permission (if you're a tenant)
- Condo board permission (if in a condo)
- $2,000,000 liability insurance certificate
- Signed indemnity in favor of the City
License Fees
Ongoing Requirements
Once licensed, you must:
- Display your license number on all listings and marketing materials
- Provide local emergency contact to all guests
- Post fire safety materials provided by London Fire Department
- Issue receipts/invoices showing license number, prices, and MAT
- Maintain insurance and file renewals 5 days before expiry
Platform Broker Requirements
London also licenses the platforms themselves:
"Short-term Accommodation Broker means any individual, partnership, or corporation that, for compensation, markets and brokers the booking, reservation, or rental, of a Short-term Accommodation on behalf of a Short-term Accommodation Provider by means of a website or digital application." London By-law L.-131-16, Schedule 21 § 1.0
Platforms like Airbnb must:
- Get a Broker License from the City of London
- Maintain $5,000,000 liability insurance (higher than host requirement)
- Verify host license numbers before allowing listings
- Collect and remit MAT on behalf of hosts
- Provide Ontario address for receiving city notices
Bedroom Limits
London caps the size of STR operations:
"shall not offer more than five bedrooms as Short-term Accommodation" London By-law L.-131-16, Schedule 21 § 7.1(d)
The 2-STR limit is interesting - it means you could potentially operate your primary home and one other unit (though the other would need to be at your Resident Address, making this practically limited).
Insurance Requirements
London requires substantial coverage:
"an insurance certificate demonstrating general liability insurance for the operations of the proposed Short-term Accommodation against claims filed against the applicant with respect to bodily injury, including personal injury and death, and property damage with a per occurrence limit of at least $2,000,000" London By-law L.-131-16, Schedule 21 § 5.1(h)
Key requirements:
- $2,000,000 minimum per occurrence
- Must cover STR operations specifically
- Bodily injury and property damage coverage required
- File renewals 5 days before expiry of current policy
Additionally, you must sign an indemnity agreement in favor of the City, protecting them from claims arising from your STR operation.
Municipal Accommodation Tax (MAT)
London charges 4% MAT on short-term rentals under By-law A.-8290-227, effective October 1, 2022. Note: hotels and motels pay a separate 5% rate; the 4% rate applies specifically to STRs. Revenue is split 50/50 between Tourism London and the City's general programs that support visitors.
For most hosts using Airbnb, the 4% MAT is collected automatically. For direct bookings, you're responsible for collecting from guests and remitting to the City.
Fines and Penalties
London's penalty structure escalates significantly:
Fines double for subsequent offenses. And each day of continued violation can be treated as a separate offense, meaning penalties can accumulate rapidly.
Staying Compliant in London
London has relatively low compliance rates (~152 licensed out of ~700 listings as of 2023). The city is increasing enforcement. Here's how to stay compliant:
- Get your CRJMC early. The criminal background check must be dated within 90 days of application. Schedule it well in advance so processing delays don't hold up your license.
- License before listing. Display your license number on every listing and advertisement. Operating without a visible license number is an easy violation to prove.
- Get landlord/condo approval in writing. If you don't own outright, you need documented permission. Verbal agreements won't satisfy the application requirements.
- Stay under 5 bedrooms. Even if your home has 6 bedrooms, you can only rent 5 as STR. Consider keeping one as personal space.
- Post fire safety materials. London Fire Department provides specific materials that must be displayed in your STR. Contact them if you haven't received them.
- Issue proper receipts. Every guest should get documentation showing your license number, itemized pricing, and MAT. This is a requirement, not optional.
- File insurance renewals 5 days early. Don't let your coverage lapse. Mark your calendar for 5 days before your policy expires to file the renewal.
- Consider the 30-day workaround. Bookings of 30+ consecutive days aren't STRs in London. Good for longer-term guests or slower seasons.
Official City of London Resources
Always verify current rules with official sources:
Official Links
- City of London - Short-Term Accommodation Licensing
- Business Licensing By-law L.-131-16
- Service London: 519-661-4500
Common Questions From London Hosts
Can I Airbnb my investment property in London?
No. London requires STRs to be at your Resident Address - the place where you habitually sleep, eat, and keep personal effects. You can only have one Resident Address. Investment properties don't qualify. Consider mid-term rentals (30+ days) for investment properties.
How much does a London STR license cost?
$196 per year, and the fee is not pro-rated. So if you get licensed in November, you still pay the full $196 and need to renew the following year. Plan your timing accordingly.
What insurance do I need?
$2,000,000 liability insurance per occurrence that covers short-term rental operations. Standard homeowner's insurance won't suffice - you need specialized STR coverage or a rider.
How many bedrooms can I rent?
Maximum 5 bedrooms can be offered as Short-term Accommodation. This applies regardless of how large your home is.
Does Airbnb collect the MAT tax?
Yes. Airbnb and other major platforms are registered as Short-term Accommodation Brokers with London and collect the 4% Municipal Accommodation Tax automatically on platform bookings.
What if I'm a tenant, not an owner?
You can still get licensed, but you need written proof that your landlord permits STR operation. If you're in a condo, you also need condo board approval. Both documents are required with your application.
Do I need a criminal background check?
Yes. London requires a Criminal Record and Judicial Matters Check (CRJMC) dated less than 90 days before your application. This is a stricter requirement than many Ontario cities.
What are the fines for operating without a license?
Fines start at $500 for the first offense but can reach $25,000 (individual) or $50,000 (corporation) for first offenses. Subsequent offenses can reach $50,000 individual or $100,000 corporate. Each day of violation can be a separate offense.
This article is for informational purposes only and does not constitute legal advice. Bylaw and regulation details change frequently. Always verify current rules directly with your local municipality before making hosting decisions.
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