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The Impact of Property Tax Increases on Short-Term Rental Owners

Owners can ensure economic viability amid these restrictions with the help of specialized companies without violating regulations.

03/07/2024 - An article published by La Presse reports the consequences of recent property tax increases, in certain localities of Quebec, on owners who rent their properties through platforms like Airbnb. The increases have had a significant impact on property income, causing concern and financial difficulties for many.

Property Tax and Its Implications

The property tax increase has been a heated topic of debate among property owners and legislators in Canada. The intention behind measures such as tax increases is to make temporary rentals more difficult, under the pretext that this would increase the supply of long-term housing and reduce rental prices.

On the other hand, the total number of temporary rental units is less than 1% of rental properties in municipalities like Montreal, with little potential to interfere with the housing crisis. The tax increase raises the cost of tourist stays and can make travel unviable for both Canadian and international tourists.

Owners in Difficulty

For many owners, especially those who rely on income generated from short-term rentals, these changes have resulted in heavy and unexpected bills. The La Presse article highlights stories of owners facing difficulties due to these new taxes.

Many bought their properties with the hope that short-term rentals through Airbnb would help cover mortgage and maintenance costs. However, with higher taxes, this financial balance has been severely affected, leaving some owners struggling to pay their bills.

Montréal recently promised a lower increase in residential taxes. To learn more, read the full article on the Radio Canada website here.

The Short-Term Rental Market

These changes raise questions about the future of the short-term rental market. With higher taxes, some owners may decide to leave this market, potentially reducing the availability of short-term accommodations and possibly increasing prices for travelers. Additionally, the changes could lead to increased regulation and oversight of short-term rental platforms like Airbnb by municipal and government authorities.

Read the full La Presse article here.

Need for Professional Guidance Given this scenario, professional guidance for short-term rental property owners becomes even more necessary. With the help of specialists, they can find strategies to ensure their units remain viable and profitable, even with the increase in property taxes.

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