One year before the Alberta government launched its “Alberta is Calling” campaign to attract workers, Marissa Kidd and her family had to return to Ontario, unable to find a place to live in Jasper, a national park townsite in the Canadian Rockies. They’d lived in Jasper since 2016, after her husband took a job in the charming mountain town.

In the fall of 2020, after many months of negotiation with their landlord, Kidd and her husband were notified they had to leave the basement unit they’d occupied for three years by June 2021. When the couple first learned about their landlord’s plan to renovict them, they considered buying a home in town to ensure long-term stability for their growing family. But they couldn’t find anything within their budget at the time — in fact, they couldn’t find another rental, either.

“The thing about Jasper is that, because everyone is so desperate to find housing, there’s always someone who needs housing more desperately than you do,” says Kidd, who’d become pregnant with the couple’s third child during this tumultuous time.

As the eviction date loomed closer, Kidd and her husband grew increasingly worried, and tried everything they could think of to find a place to live, she says. “We were putting up posters and putting in ads all over town.”

But their efforts proved unsuccessful, and in June 2021 the young family moved into a trailer with a newborn baby, a two-year old toddler, and a four-year-old child. After about three weeks in the trailer, the family decided to leave for Ontario, with hopes that Kidd’s husband would find a job there.

“It was, hands down, one of the most stressful times in my entire life,” Kidd says. “Having just given birth and it being a pandemic, and losing our housing.”

Vacancy rate close to zero for a decade

In a province touted for its housing affordability, Kidd’s experience may sound like an exception to the rule — but for those trying to raise a family in a resort town where rental vacancy rates have remained close to zero for at least a decade, driving up rents by 30 per cent over the same period. Finding housing stability isn’t an easy feat, even for those who already own a home.

“Airbnb is the only way for people to afford the absurd prices of housing,” Kidd says, acknowledging the challenges many Jasper homeowners face. “It’s much more lucrative to Airbnb your place than it is to rent long term. Everyone turns spare units into tourist accommodations because they can’t afford their houses otherwise — it’s a cycle.”

Indeed, the town of Jasper is a prime example of how the revenue gap between long- and short-term rentals incentivizes landlords to pull their properties from the long-term rental market and list them instead on a home-sharing platform like Airbnb or HomeAway.

“Landlords are going to do what’s lucrative for landlords,” says Michael Clancy, a professor of politics, economic and international studies at the University of Hartford, in Connecticut, whose research focuses in the political economy of tourism, including the financialization of housing.

So rather than providing housing that local workers can afford, landlords in tourist destinations are choosing to rent out their property to tourists, who can pay more, he says.

Danielle Kerrigan is a graduate researcher with the Urban Politics and Governance research group at McGill University focussed on short-term rentals and the platform economy. She says the movement of units between the short-term and long-term markets is more evident in areas that are attractive to tourists.

“The main ‘pull’ factor is that in certain areas, and with certain units, property owners can make a lot more money having a short-term rental,” she says. “And then the push factor is wanting to shirk the responsibilities of being a landlord.”

This problem, however, isn’t new.

Resort towns in Alberta and elsewhere have borne the havoc short-term rentals (STRs) wreak on the local rental market for many decades.

Since the 1990s Jasper, Banff, and Canmore began regulating STRs as tourist accommodations, and today these towns have the most stringent regulations in the province. By contrast, frameworks regulating STRs in Alberta’s largest cities, Calgary and Edmonton, are some of the laxest in Canada — though this doesn’t mean they’re exempted from similar challenges.

‘Alberta is calling’ but you may be forced to live in an Airbnb

Before the pandemic, STRs in Alberta experienced significant revenue growth, but unlike provinces like P.E.I., Quebec or British Columbia, the share of dwellings listed in a home-sharing platform remained modest at below one per cent.

However, as Alberta aims to diversify its economy and boost tourism growth, the role STRs play is shifting, albeit slowly and unevenly across the province.

Roughly 60 per cent of STR listings in Alberta are concentrated in Edmonton and Calgary; 15 per cent in Jasper, Canmore and Banff; and the remaining 25 per cent of listings are scattered across smaller cities such as Lethbridge, Red Deer, Fort McMurray and Grande Prairie.

According to AirDNA, a company that collects data and analytics on short-term rentals, the number of STR units in Alberta increased by 46 per cent between 2019 and 2023 — from 9,787 units in the first quarter of 2019, to 14,274 in 2023.

This growth has come at the expense of rental units in the secondary market — that is, units rented out by non-commercial, private landlords. The impact of STRs in areas outside of Calgary and Edmonton is hard to determine, however, as small jurisdictions in Alberta lack data on the number of rentals in the secondary market.

A patchwork of regulation across the province

In the absence of provincial STR guidelines, as is the case of Quebec, each Alberta municipality can implement the regulations that suit best the local context, while the province’s only requirement is that STRs collect a 4 per cent tourism levy.

Banff and Jasper have the most rigorous STR regulations in Alberta, as the number of permitted STRs is capped in the former and limited by the zoning bylaw in the latter. In Canmore, zoning also determines where STRs are allowed, making a distinction between home accommodations exclusively for visitors, and units that can be rented in either the long- or short-term markets (tourist homes). (In June, town administration recommended removing tourist homes from the land-use bylaw as part of Canmore’s housing plan. Amendments to the land-use bylaw will be debated this month.)

Smaller jurisdictions that are starting to attract visitors such as Hinton and Drumheller, have only recently considered regulating short-term rentals. In 2022, the town of Hinton, which is located 78 kilometers northeast of Jasper, approved its short-term rental bylaw. This fall, the town of Drumheller expects to implement its short-term rental regulation, which was approved in the spring.

Calgary and Edmonton have few restrictions in place. In these cities, recently enacted regulations focus on three goals: to ensure the safety of STR guests; minimize nuisances caused to neighbours; and bring in revenue to the municipal coffers.

According to Gillian Petit, a research associate at the University of Calgary’s School of Public Policy, the reason for this is that, at the time the regulations were created, the local context didn’t seem to indicate a need to “clamp down on short-term rentals.”

In 2019, when Edmonton city council voted to mandate a business licence for short-term rentals, the city’s vacancy rate was 4.9 per cent, a rate that would continue to increase over the following two years. Similarly, when the City of Calgary required STRs register as a business in 2020, rental vacancies had peaked at 6.3 per cent, the highest rate since 2017. (Generally, a vacancy rate of 3 per cent is considered healthy.)

However, since these regulations were enacted, the local context has changed significantly — especially in Calgary.

In October 2022, CMHC estimated Calgary’s rental vacancy rate for units in the secondary market at 1.8 per cent, the lowest since 2019 — that’s about 522 rental units vacant. Meanwhile, 5,233 units were listed in the short-term market in the last quarter of 2022, and between 20 and 30 per cent of these units are listed full-time in a home-sharing platform.

“In Calgary, the long-term rental market has definitely tightened up,” Petit says. “There’s definitely an affordable housing issue.”

Petit is part of a research team working on a city-funded project whose goal is to identify the implications of the uptake of STRs in Calgary. He says that even though the number of STR listings in Calgary has increased — by 30 per cent since 2019, according to AirDNA data — these units aren’t alone in driving the challenges in Calgary’s long-term rental market.

“In Calgary, I would say there may be an argument for city council to step in and do something,” Petit says.

Housing affordability is a global issue driven by a complex combination of factors, Clancy says. “And then you add things like more tourism, and the introduction and expansion of short-term rentals — that just pushes everything over the top.”

Indeed, evidence shows that short-term rentals can increase housing costs in the long-term rental market, and experts agree that regulating STRs and home-sharing platforms can mitigate some of the negative impacts short-term rentals have on local markets.

“Short-term rentals are definitely part of the problem,” Kerrigan says.

Also to blame is the federal government shifting away from funding, building, and maintaining non-market housing, towards a reliance on the private market to house Canadians, she says. “Short-term rentals represent another way for individuals and companies to use housing to make money at the expense of all of us who need it for survival.”

In Alberta, about one quarter of the rental stock is provided by private landlords in the secondary market, and less than 2 per cent of all dwellings are non-market, including non-profit, public and co-op housing. (For context, 3.5 per cent of all dwellings in Canada are non-market). This situation, added to weak tenant protections, leaves Alberta renters especially vulnerable to the rent gap, as landlords can choose to rent out their property in whatever market is the most profitable at any given time — at the expense of tenants like Kidd and her family.

Moreover, the orientation of Canada’s social support system towards asset-based welfare, where homeowners rely on the value of their home to support their retirement, or in rental revenue to make up for falling real wages, results in strong opposition to policies that hamper the alternatives available to those who’ve come to own one or more properties.

This situation is apparent in Jasper. In the face of a housing shortfall of 700 units, last year Parks Canada proposed an amendment to the land-use bylaw that would limit STRs further. But despite a relatively small number of STR listings (peaking at 112 last summer), Park’s proposal quickly fell through due to community pushback. (The housing shortfall in Jasper has tripled since 2022, yet the construction of 40 non-market units continues to stall.)

“We have a very powerful political constituency of homeowners deeply invested in the value of their homes continuing to appreciate and relying on that for retirement, for their own financial wellbeing,” Kerrigan says. “And we have a government that’s unwilling to change this paradigm.”

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