What You Need to Know Before Buying a Vacation Rental Kelowna

So you’re thinking about buying a vacation rental in Kelowna? Good news for you, short-term rentals (STRs) are back on the docket. After a bit of a rollercoaster with local bylaws, Kelowna has updated its stance to line up with the province. That means you can now legally rent out your place short-term again. However, there are still some caveats to the new regulations. Whether you’re looking to invest, cash in on Kelowna’s tourist traffic, or just make your mortgage more manageable, now is a good time to look into this. Though a word of caution, while there’s money to be made, you must know the rules, pick the right property, and understand how to run an STR. 

Understanding the New Short-Term Rental Rules in Kelowna

Let’s start with the new regulations. Last year, the city cracked down hard on STRs, especially ones operating in areas where they weren’t supposed to. The changes caused a lot of confusion, and plenty of owners had to shut their doors or rethink their strategy. But that’s changing now.

As of this month, Kelowna’s back in business when it comes to vacation rentals. You can now apply for a short-term rental license if the property is your principal residence. That means you must live there most of the year. You can rent it out when you’re away, or rent a secondary suite or carriage house on the same lot. No more operating full-time Airbnbs in investment-only condos downtown. The rules are clearer now, but they’re also stricter.

Every STR needs a city license and registration with the province. No license, no rental. And fines are hefty for those who violate the requirements. So make sure you’ve done your homework. City officials recommend using the online portal to apply, because it’s faster on all fronts. Also, get your unit inspected, and make sure your insurance is STR-approved. 

So what does this mean for buyers? It opens the door again. If you find a home with a suite or carriage house, and you’re planning to live there too, it could work. But make sure it’s legal. Illegal suites might be cheap, but they won’t get you an STR license. Always confirm zoning and check if a property has a valid occupancy permit. Talk to your REALTOR® or a lawyer if you’re not sure. 

What Kind of Return Can You Expect From a Vacation Rental Kelowna?

Vacation rentals in Kelowna can pull in strong income, especially in the summer. Between wine tours, lake days, and ski season at Big White, there’s demand almost year-round. If you’ve got the right place in the right location, you’re looking at solid potential for revenue.

A good one-bedroom suite near downtown or the lake might bring in $250 to $450 a night during peak season. A two-bedroom carriage house with some style? Could be $500 a night or more in July and August. If you can rent it 20 nights a month, you’re looking at $5,000–$10,000 monthly. Compare that to long-term rents and you’ll see why STRs are so appealing.

That said, there are costs. Cleaning fees, platform fees (Airbnb and VRBO both take a cut), maintenance, and wear-and-tear. Don’t forget income tax either. Run the numbers carefully. Work out your mortgage, property taxes, utilities, insurance, and a buffer for repairs. Then compare that to what you can realistically earn based on Kelowna’s tourist season.

If you’re looking to buy a property with STR potential, consider homes with lake views, walkability to restaurants and shops, a hot tub, or even just a modern interior. Guests want convenience and hotel-style luxury. The better your place looks, the more you can charge and the better your reviews will be.

Ready to Buy? Here’s What to Keep in Mind

If you’ve made it this far, you’re probably ready to start looking. First, you’ll want to search for properties zoned for suites. That way, you can legally rent out a separate unit while living on-site. Most of Kelowna’s newer subdivisions are great for this, especially in the Lower Mission, Glenmore, and parts of Rutland. You’ll also find carriage house-friendly properties in the Pandosy area or near Knox Mountain.

Second, think like a guest. Would you want to stay there? Is it quiet at night? Close to restaurants? Does it have parking? A place near the lake or with mountain views will always rent better than something beside a construction site or highway. 

Third, think long-term. Can this property work as a family home or long-term rental if the rules change again? Kelowna’s market moves fast, and policies change. Buy something that still makes sense even if STR income disappears.

Finally, get help. Work with a REALTOR® who knows the STR market here. You’ll avoid nasty surprises and probably find better options than what’s listed on public sites. And if you’re not ready to manage it yourself, look into property management companies that specialize in vacation rentals. 

Ready to Start a Vacation Rental Kelowna

With short-term rentals legal again, this could be your window to invest in a property that pays for itself and then some. But don’t rush it. Learn the rules, pick the right property, and make sure you’ve got a clear plan. If you’re thinking of buying a vacation rental Kelowna, contact us today! We’ve helped numerous Kelowna buyers find investment properties. Be sure to check out our social media for the latest news and updates!