How To Start an Airbnb Business in Canada

Introduction.

If you’ve been thinking about diving into the world of Airbnb, you’re not alone. Many Canadians are looking to capitalize on the booming short-term rental market, and it’s easy to see why.

With millions of travelers seeking unique, affordable places to stay, becoming an Airbnb host can be a smart way to make some extra income—or even turn it into a full-fledged business.

Whether you’ve got a spare room, a vacation property, or you’re looking to start fresh, starting an Airbnb business in Canada can be a rewarding venture.

But let’s be honest: getting into the Airbnb game can feel overwhelming, especially if you’re new to it. There are a lot of things to think about—from the legal side to setting up your space, attracting guests, and keeping everything running smoothly.

That’s where this guide comes in. I’ve broken down all the key steps for starting your own Airbnb business in Canada so you can hit the ground running without any surprises.

Why Start an Airbnb Business in Canada?

Before we dive into the “how,” it’s important to understand why starting an Airbnb business is such a great idea. Canada has become one of the most sought-after destinations for travelers, with millions of visitors every year.

According to Airbnb, Canada welcomed over 16 million guest arrivals in 2019 alone. This number has only grown, and cities like Toronto, Vancouver, Montreal, and Calgary are in high demand.

Whether you’re in a bustling urban center or a more remote area, there’s a strong chance people will want to book your place.

Additionally, the flexibility of Airbnb is hard to beat. You can decide when to rent out your space, how much to charge, and you’re your boss. It’s a fantastic opportunity for anyone looking to make extra money or start a side hustle.

How Do I Start an Airbnb Business in Canada?

Step 1: Understand the Legal Requirements.

Before you even think about listing your space, you need to be sure you’re following the laws in your province or city. Every place has different rules when it comes to short-term rentals.

Some areas have specific regulations regarding zoning, taxes, insurance, and permits. For instance:

In Toronto, you must register your listing with the city, and you’re only allowed to rent out your primary residence.
In Vancouver, short-term rentals like Airbnb are only allowed in certain areas and require a business license.
Montreal has specific rules about renting out units in apartment buildings, and it’s mandatory to declare income from Airbnb to the tax authorities.

To make sure you’re on the right track, it’s worth checking with local authorities or even seeking legal advice. This can save you a lot of headaches down the road.

Step 2: Choose Your Property and Decide on the Type of Listing.

You don’t have to own a huge mansion to make money on Airbnb. It could be an extra bedroom in your apartment, a guest house in your backyard, or even a cabin in the woods. The key is to figure out what you can offer that will appeal to potential guests.

Private room: Rent out a room in your home and share common areas like the kitchen and bathroom.
Entire home: Rent out an entire property, which is perfect for those with vacation homes or empty rental units.
Unique stay: Do you have a quirky property? A treehouse, tiny house, or even a boat could attract guests looking for something different.

Pick the option that works best for you, depending on your space and how much time you’re willing to invest. Keep in mind, the more unique or appealing your space is, the more likely it is to stand out.

Step 3: Set Your Budget and Prepare the Space.

Starting an Airbnb business isn’t free, so it’s important to set a budget and be prepared for upfront costs. Here’s what you should consider:

Furnishing: If your space isn’t already fully furnished, you’ll need to budget for furniture, bedding, and décor to make your place comfortable and inviting.
Cleaning and maintenance: You’ll need to keep your place clean between guest stays. You might need to invest in professional cleaning services or create a cleaning routine.
Photography: High-quality photos are essential to attracting guests. You can hire a professional photographer or take your own, but make sure the photos are clear and showcase your space in its best light.
Airbnb setup fees: Airbnb takes a commission (around 3% for most hosts), so factor that into your pricing when you calculate how much you want to earn.

Once everything is set up, you’ll want to create a welcoming environment that encourages good reviews and repeat bookings. Little touches like fresh towels, a bottle of wine, or a guide to local attractions can make a big difference.

Step 4: Create an Attractive Listing.

When it comes to listing your property, you want to make sure your description is clear, accurate, and enticing. Here are a few tips:

Write a catchy title: Make it stand out but also be truthful about what you offer. “Cozy Downtown Apartment Near the CN Tower” will grab attention while still being specific.
Describe the space: Talk about the size, layout, amenities, and what makes your property unique. Is there a great view? A hot tub? Fast Wi-Fi?
Set expectations: Be clear about any rules, such as whether pets are allowed or if smoking is permitted. Transparency upfront helps avoid conflicts later.
Highlight local attractions: If your place is near restaurants, parks, or popular tourist spots, mention it! Guests love to know what’s nearby.

Great pictures and a clear, inviting description are key to getting those first bookings.

Step 5: Set Competitive Prices.

Pricing can be tricky, but the good news is that Airbnb gives you some help. The platform has a tool that suggests pricing based on your location, property type, and other factors.

However, you should still research the market to get a sense of what other hosts in your area are charging.

Be aware of peak seasons. In Canada, for example, tourist-heavy months in summer or around major events can mean higher demand and prices. The key is to find a balance that maximizes your earnings while staying competitive.

Step 6: Manage Bookings and Guest Expectations.

Once your listing is live, guests will start booking. It’s important to be responsive to inquiries and bookings. Quick responses improve your ranking on Airbnb and make your listing more attractive to potential guests.

Keep your guests’ needs in mind during their stay. Provide helpful information, respond to questions promptly, and address any issues that arise.

If you have a good relationship with your guests, they’re more likely to leave positive reviews, which is crucial for attracting more bookings.

Step 7: Understand Taxes and Insurance.

As an Airbnb host, you’ll need to pay taxes on the income you earn. In Canada, Airbnb will report your earnings to the Canada Revenue Agency (CRA) for tax purposes.

You’ll also want to look into insurance options to protect yourself in case of accidents, property damage, or other unforeseen situations. Airbnb offers host protection insurance, but you might want to supplement it with your coverage.

FAQs

Q: Do I need a license to host on Airbnb in Canada?

A: It depends on where you live. Some cities, like Toronto and Vancouver, require a business license and registration. Be sure to check with your local government.

Q: How much can I earn on Airbnb in Canada?

A: Earnings vary widely depending on location, property type, and how often you rent out your space. On average, Canadian Airbnb hosts earn about $3,500 per year, but it can be much higher in tourist-heavy areas.

Q: What happens if a guest damages my property?

A: Airbnb offers host protection insurance, but it’s a good idea to have additional coverage through your own insurance provider for added peace of mind.

Conclusion

Starting an Airbnb business in Canada can be an exciting and profitable venture if you’re prepared. From understanding the legal requirements to setting up your space and pricing it right, there’s a lot to consider. But if you approach it the right way, it can lead to a steady stream of income and a fun side business.

So, are you ready to become an Airbnb host? What’s holding you back from turning your extra space into a money-making opportunity?