Two Strategies, One Question: Where Does the Money Actually Go?

Ontario property owners have been wrestling with this question for years, and it has only grown more complicated as municipal licensing rules tighten and the provincial regulatory environment shifts. Should you furnish a unit, list it on a short-term rental platform, and chase peak-season rates? Or should you find a reliable long-term tenant, sign a lease, and collect steady monthly income?

We want to be upfront before you read another word: Blue Anchor Property Management manages long-term residential rentals only. We cover Oshawa to Belleville, with properties as far north as Campbellford and down into Picton. We do not manage short-term rentals, and we are not going to pretend that long-term is always the right answer for every property in every location. What we will do is give you an honest comparison so you can make a decision that fits your situation.

With that said, here is what the two strategies actually look like in Ontario right now.

The Short-Term Rental Case: Real Upside, Real Complexity

Short-term rentals through platforms like Airbnb can generate significantly higher gross revenue per night than a long-term lease, particularly in high-tourism corridors. Niagara Falls, Prince Edward County, cottage country, and parts of Toronto remain strong markets for this reason. When a property is well-located and well-managed, peak occupancy can produce monthly gross figures that a long-term tenant simply cannot match.

The honest caveat is that gross revenue and net income are very different numbers. Short-term rental owners carry costs that long-term landlords largely avoid:

• Platform service fees, which typically range from roughly 3 percent to 15 percent per booking depending on the platform and listing structure.
• Professional cleaning after every guest stay.
• Higher insurance premiums, since most standard landlord policies exclude short-term rental use.
• Furnishings, linens, toiletries, and ongoing supply replenishment.
• Active listing management and guest communication, which is either your time or a paid service.
• Municipal licensing fees and Municipal Accommodation Tax remittance where applicable.

Seasonality is the other variable that projections often understate. A property that earns strong revenue in July and August may sit at low occupancy in January and February, and the carrying costs do not pause for the off-season. In secondary markets and smaller towns outside the major tourism corridors, short-term occupancy can be unpredictable enough that annual net income falls below what a long-term tenant would have paid.

Municipal Licensing: What Is Verifiable Right Now

Short-term rental regulation in Ontario is set at the municipal level, so the rules vary considerably by city. A few verified reference points:

• Toronto requires short-term rental hosts to register with the city and limits short-term rental to a host's principal residence. Secondary investment properties cannot legally operate as short-term rentals in Toronto under this framework.
• Prince Edward County has had its own short-term rental licensing regime, including caps on the number of licensed properties in certain areas. Owners should check directly with the County for current limits and fees, as these have been subject to revision.
• Ottawa requires registration and collects a Municipal Accommodation Tax from hosts.
• Many smaller Ontario municipalities have introduced or are actively considering similar requirements.

The principal residence restriction in particular is a significant constraint for investors. If you cannot legally operate a short-term rental on a property you do not personally live in, the entire income model changes. Always verify the current rules with the relevant municipality before purchasing or converting a property for short-term use.

The Long-Term Rental Case: Predictable Income and Lower Daily Involvement

Long-term rentals in Ontario operate under the Residential Tenancies Act. Tenants sign leases, typically for twelve months, and then continue on a month-to-month basis. The landlord receives rent on a fixed schedule, carries no furnishing costs, and does not manage guest turnover. Maintenance costs tend to be lower because the property is not being cleaned and reset repeatedly, and because a stable tenant has an incentive to treat the property reasonably.

Vacancy rates across Central Ontario have remained low by historical standards, which means well-priced, well-maintained units in markets like Belleville, Trenton, Cobourg, and Oshawa are not sitting empty for long when they come to market. Demand from families, working professionals, and retirees in these communities is steady and less tied to tourism cycles than short-term rental demand is.

The trade-off is that long-term rental income is capped in a way that short-term income is not. Ontario's rent increase guideline for 2026 is 2.1 percent, set by the province under the Residential Tenancies Act. If you have a sitting tenant in a unit that was first occupied for residential purposes before November 15, 2018, that guideline applies to any rent increase you serve. Units first occupied after November 15, 2018 are exempt from the guideline cap, but landlords must still provide 90 days' written notice on Form N1 and can only raise rent once every 12 months. The article incorrectly implies the only restriction is tenant agreement; the notice and timing requirements still apply.

For investors focused on understanding the full cost picture of rental ownership, long-term rentals tend to produce more predictable net income because the cost variables are narrower. You are not absorbing cleaning fees, platform commissions, or supply costs every time someone checks out.

Regulatory Environment for Long-Term Landlords in 2026

The regulatory picture for long-term landlords has shifted meaningfully over the past few years, and staying current matters.

Bill 97, the Helping Homebuyers, Protecting Tenants Act, 2023, strengthened renovation right-of-first-refusal rules and doubled RTA fines.

Bill 60, the Fighting Delays, Building Faster Act, received Royal Assent on November 27, 2025, and its most significant change for landlords came into force on September 21, 2026. The N4 notice period for non-payment of rent was shortened from 14 days to 7 days. Separately, Bill 60 updated the persistent late payment test for N8 notices. The change, via new s.8.1 of O. Reg. 516/06, codifies a specific legal threshold — rent paid more than 7 days late on at least 3 occasions within any 6-month period — which guides LTB adjudicators; it is not solely a pre-service documentation requirement. These are meaningful procedural changes, and understanding exactly how the new N4 timeline works is worth your time if you are self-managing.

Regarding own-use evictions: the bad-faith presumption is triggered when the person named in the N12 fails to occupy the unit within 60 days of the termination date (or actual move-out date if the tenant vacates late) — not by re-renting within a year. The presumption is rebuttable. This change came from Bill 60, effective September 21, 2026.

Rent increases must still be served using the correct form with proper notice. Our post on using the N1 form to increase rent in Ontario walks through the mechanics if you need a refresher.

A Side-by-Side Cost Comparison

The numbers below are illustrative. Actual figures will vary by property, location, and how each strategy is executed. The purpose is to show the structure of costs, not to predict your specific outcome.

Illustrative Short-Term Rental (monthly, mid-size unit in a tourism market)

• Gross rental revenue: variable, potentially high in peak months, low in off-season
• Platform fees: roughly 3 to 15 percent of each booking
• Cleaning per turnover: cost depends on frequency and unit size
• Insurance premium uplift: typically significant compared to standard landlord coverage
• Supplies and furnishing replacement: ongoing
• Municipal licensing and accommodation tax: varies by municipality
• Net income: can be strong in peak season, can be negative in slow months

Illustrative Long-Term Rental (monthly, same unit)

• Gross rental revenue: fixed monthly amount per lease
• Property management fee (if using a manager): at Blue Anchor, our Standard plan is 5 percent of collected rent per unit per month, with a $50 minimum on occupied units and no fee in a month where the unit is vacant and no rent is collected
• Maintenance and repairs: lower frequency than short-term due to stable occupancy
• Tenant placement: at Blue Anchor, 50 percent of one month's rent on Standard, paid once at placement
• Net income: lower ceiling than peak short-term, but consistent across all twelve months

One structural advantage of long-term rentals that often goes unmentioned: you are not absorbing a cost every time someone leaves. With short-term rentals, every checkout triggers a cleaning bill, a linen cycle, and a re-listing effort. With a long-term tenant who stays for two or three years, those costs simply do not exist.

You can review our full fee structure, including our Platinum plan at $295 per unit per month with ancillaries included, at our pricing page.

Which Strategy Fits Which Investor?

Short-term rentals tend to make the most sense when the property is in a genuine tourism destination, the owner can legally operate it as a short-term rental under local rules, the owner is willing to actively manage or pay for active management, and the owner accepts income variability as part of the model.

Long-term rentals tend to make more sense when the property is in a market driven by employment and population rather than tourism, the owner values predictability over upside, the owner wants lower daily involvement, and the owner is building a portfolio over time rather than maximizing a single unit's short-term output.

For most of the markets we work in, from Oshawa through Cobourg and into Belleville and Picton, the tenant base is made up of families, working adults, and retirees who want stable housing. That demand supports long-term rentals well. Short-term rental demand in most of these communities is thinner and more seasonal than in the major tourism corridors, which changes the math considerably.

If you are evaluating a specific property and trying to decide which path to take, our post on what to look for when buying a rental property covers the due diligence questions worth asking before you commit to either strategy.

Frequently Asked Questions

Can I switch a property from short-term to long-term rental if the numbers stop working?

Yes, and many owners do exactly that. The main consideration is that once you place a long-term tenant, you are subject to the Residential Tenancies Act and cannot simply end the tenancy because you want to switch back. The decision to go long-term is easier to make than it is to reverse, so it is worth thinking through your medium-term plans before placing a tenant.

Does Blue Anchor manage short-term rentals or help with Airbnb listings?

No. Blue Anchor Property Management manages long-term residential rentals only. We do not manage short-term rentals, Airbnb listings, or vacation properties. If short-term rental management is what you need, you will need to find a specialist in that area.

How does the 2026 rent increase guideline affect my long-term rental income?

The 2026 guideline is 2.1 percent, set by the province. If your unit is subject to rent control, you can increase rent by up to 2.1 percent with proper notice using the N1 form, provided you have not already increased rent in the previous 12 months. For units exempt from rent control (first occupied after November 15, 2018), there is no guideline cap — but landlords still cannot raise rent without providing at least 90 days' written notice using Form N1 and waiting at least 12 months since the last increase or tenancy start. The statement implies the tenant's agreement is the only constraint, which is incorrect.

What changed with the N4 notice in 2026?

Bill 60, which received Royal Assent on November 27, 2025, shortened the N4 notice period from 14 days to 7 days, effective September 21, 2026. This means that when a tenant fails to pay rent, you can now serve an N4 giving them 7 days to pay or vacate, rather than the previous 14. Bill 60 also updated the persistent late payment test for N8 notices, codifying a specific legal threshold via new s.8.1 of O. Reg. 516/06. This change came from Bill 60, not from Bill 97.

Is long-term rental income truly more stable, or is that just a talking point?

It is genuinely more stable in the sense that a signed lease produces a fixed monthly obligation from the tenant regardless of season, tourism trends, or platform algorithm changes. The risk in long-term rentals is concentrated in tenant quality and vacancy between tenancies, not in month-to-month demand fluctuation. Good tenant screening and low vacancy periods are the main levers. Short-term rental income is more variable by design, with the upside of higher peak revenue and the downside of low-season gaps and higher operating costs.

Blue Anchor manages rentals along the 401 from Oshawa to Belleville. See the communities we serve and our management fees and pricing.

Ready to Talk About Your Property?

If you own a residential rental property between Oshawa and Belleville, or as far north as Campbellford or down into Picton, and you are considering long-term professional management, we would be glad to have a straightforward conversation about whether Blue Anchor is the right fit. There is no obligation, and we will tell you honestly if we think self-management or a different approach makes more sense for your situation. Reach out through our website to get started.