Kelowna council greenlights bid for partial short-term rental exemption to support tourism surge

As expected, Kelowna City Council has directed city staff to apply for an exemption from the province’s short-term rental regulations.

On Monday, Kelowna council gave staff the greenlight to also request a fast-track approval by this spring to support accommodations for major summer events.

Currently, the province’s rules limit short-term rentals to the home the host lives for a majority of the year. However, municipalities with a vacancy rate of 3% or higher for two consecutive years can opt out of that rule.

In mid-December, the numbers were released and show that Kelowna had a vacancy rate of 6.9% in 2025. The previous year saw a rate of 3.8%.

Although the city will be requesting an exemption from the primary resident rule, it won’t apply to the entire city.

If approved, the exemption would only apply to buildings that operated or permitted short-term rentals before the province introduced changes in late 2023, which is in line with changes Kelowna City Council made in early 2024.

Under the current guidelines, the exemption wouldn’t go into effect until Nov. 1.

The city will be lobbying to the province to allow for an earlier exemption. The City of Kelowna is not alone in its advocacy. Kelowna Mission MLA Gavin Dew has been pushing for an earlier exemption date as well.

The advocacy is in preparation for several large events coming to the city including the Memorial Cup, the BC Summer Games and two BC Lions games.

Development planning department manager Nola Kilmartin told council that the city has between 2,500 and 3,000 rooms but close to 4,000 are going to be needed for the Memorial Cup in May.

Kilmartin told council that the city has been a “leader in delivering housing in accordance with provincial mandates” and has exceeded Housing Supply Act targets.

She also pointed out that Kelowna was the first municipality in BC to adopt bylaws implementing Bills 44, 46 and 47 while introducing shelter solutions through the HEART & HEARTH program.

“Staff will then return to council, we’re targeting in early February, with necessary bylaw amendments that would receive initial consideration,” Kilmartin said.

“We would not be in a position to adopt those bylaws, of course, until we are able to perceive that early exemption approval from the province.”

Kilmartin told council that staff have already started advocacy and have had numerous discussions with the Minister of Housing. She said the minister was positive in late December during media and said “they were looking forward to working with Kelowna.”