Guide to Renting Out Your Condo in Toronto – Step-by-Step Compliance

If you own a condo in Toronto and are considering renting it out—whether for the long term or as a short-term rental—there are crucial rules and regulations you must follow. Renting out a condo isn’t as simple as listing it online; you need to navigate condo bylaws, city regulations, and provincial laws to ensure compliance.

This guide will break it all down so you can rent with confidence.

1. Check Your Condo Corporation’s Bylaws

Before listing your unit, your first step should always be reviewing your condo corporation’s bylaws. Each condo board sets its own rules regarding rentals. While some may allow short-term rentals like Airbnb, most strictly prohibit them.

Even for long-term rentals, buildings often have specific policies. Some may require a minimum lease term of six months or a year. Others might mandate that all tenants renting a unit must be related. Believe it or not, some buildings do not permit unrelated roommates to share a condo.

To avoid fines or legal trouble, obtain this information directly from your condo board or property manager.

What does a condo board do? Watch our video: Navigating Toronto Condo Boards to find out!

2. Short-Term Rentals: Know the City of Toronto’s Rules

If you’re considering Airbnb or another short-term rental option, you must comply with the City of Toronto’s regulations in addition to your condo corporation’s rules.

Key short-term rental regulations in Toronto include:

You can only operate a short-term rental from your primary residence. Investment properties are not permitted for short-term rental use.
You must register with the City of Toronto as a short-term rental operator.
You are required to pay the Municipal Accommodation Tax (MAT), which is currently 4%.

Due to these restrictions, short-term rentals are only viable for those who travel frequently and want to rent out their condo while away or for homeowners looking to rent out a portion of their unit, such as a single room.

3. Long-Term Rentals: Complying with Ontario’s Residential Tenancies Act

If you opt for a long-term rental, Ontario’s Residential Tenancies Act (RTA) applies. This legislation protects both landlords and tenants and includes rules on:

Rent increases (which are regulated and require proper notice)
Eviction procedures (which must follow legal guidelines)
Maintenance responsibilities (ensuring landlords maintain the property in good condition)

Every Toronto landlord should familiarize themselves with the RTA to ensure compliance and avoid potential legal disputes.

Do you have more condo questions? Here are a few more videos you might find interesting:

4. Get the Right Insurance Coverage

Standard condo insurance does not typically cover rental activity. Whether you’re renting short-term or long-term, you’ll need specialized coverage:

Landlord insurance for long-term rentals
Short-term rental insurance for platforms like Airbnb

Consult your insurance provider to make sure you’re adequately covered.

5. Understand the Tax Implications

Any rental income you earn—whether from an Airbnb guest or a long-term tenant—is taxable in Canada. You must:

Keep detailed records of rental income and expenses
Report earnings to the Canada Revenue Agency (CRA)
Consider hiring an accountant to ensure proper tax compliance

Final Thoughts: Renting Smart & Legally

Renting out your Toronto condo can be a great opportunity, but following the rules is essential to avoid fines, legal troubles, or conflicts with your condo board. Whether you choose a short-term or long-term rental, understanding condo bylaws, city regulations, provincial laws, insurance requirements, and tax obligations will set you up for success.

By staying informed and compliant, you can confidently rent out your property and maximize your investment potential.

Thinking about renting out your condo? Make sure you’re following all the right steps to protect yourself and your investment!

If you have condo questions, we’re here to help! Get in touch today by filling out the form on this page, calling 416-909-9235, or emailing info@yaelandco.com today!