Kelowna Breaks Free From BC's Short-Term Rental Rules — What It Means for Investors, Visitors, and the Province

✍️ By Debbie Balfour | WBN News | April 22, 2026| Click HERE for your FREE Subscription to WBN News and/or to be a Contributor.

• 6.9%Kelowna vacancy rate — highest of any major Canadian metro
• 14.3%Drop in BC asking rents since 2023 STR restrictions
• 60+BC communities are still under the principal residence rule

The BC government announced April 17 that Kelowna, the only municipality to apply this year, has been granted an exemption from the provincial principal residence requirement under the Short-Term Rental Accommodations Act. Starting June 1, property owners in eligible tourism-zoned buildings no longer need to live in a unit to list it short-term on platforms like Airbnb.

The city qualified by sustaining a rental vacancy rate above 3% for two consecutive years. From a crisis-level 1.2% in 2023, Kelowna's vacancy climbed to 3.8% in 2024 and surged to 6.9% by the end of 2025; the highest of any large Canadian metro. It also secured a one-time accelerated timeline, moving the effective date from November 1 to June 1 to capture the summer season, which includes the BC Summer Games, Touchdown Kelowna, and Rock The Lake.

What it means for investors

Condo owners in eligible STR-subzone buildings, those with pre-2024 approvals like Aqua, Movala, and Brooklyn, can now once again cash-flow investment units. A business licence and provincial registration are still required. Importantly, the exemption is narrow: residential zones remain protected, and strata consent is mandatory. The presale market, chilled since 2024 when STR income assumptions vanished, may also stabilize.

What it means for visitors and tourism

Two summers of constrained accommodation hurt Kelowna's restaurants, wineries, and event venues. More short-term inventory ahead of a packed calendar should translate into more visitor nights and stronger local spending. BC Tourism Minister Anne Kang called STRs "an important part of the tourism sector" and framed the change as key to sustainable economic growth.

What does it signal for the rest of BC?

Kelowna is a proof of concept, not a template. The 60-plus communities still under the rules remain far from the 3% vacancy threshold. Starting in 2027, the opt-out application window shifts to February 28 with a June 1 effective date, better aligned to the tourism season. But earning that flexibility still requires solving the housing problem first.

"Accelerating these timelines will assist communities like Kelowna that have brought vacancy rates to healthy levels through their hard work on housing." — Christine Boyle, BC Minister of Housing and Municipal Affairs.

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