We're going to talk about short-term rentals like Airbnb versus long-term rentals, like your traditional year lease. And I know some of you are thinking, well, Airbnb in Ottawa, we actually can't do that we have to live in the property. And that's true. But this is for the broader perspective of the investment strategies overall. And keep in mind that laws and bylaws always change. And I definitely see the potential for Airbnb to be a viable option in the future.

So first, let's talk about the pros of each. And long-term rentals, you're going to have to worry about furnishing and you're going to have a lot less work and management, and three, you're gonna have a predictable income. Assuming you get the right tenant who pays on time every month, you're gonna be able to have a predictable income that you can budget for.

Now, with short term rentals, whether using Airbnb, VRBO, or HomeAway, you're going to have a higher income, you're going to have the ability to use the place if you like, and you're going to have a diversified risk. Firstly, when we're talking about higher income, we can see the difference between maybe $2,000 a month on a long term rental and $5,000 a month for Airbnb. But you got to remember that this isn't all profit, Airbnb is going to come with higher fees like cleaning fee, management fee, fees to Airbnb, and taxes depending on the city that you live in. Another big advantage to Airbnb is being actually able to use the property. So say the property is on the water or near desired location you like to visit, you always have the opportunity to book it yourself when it isn't booked. If you have a long term rental, the tenant is going to be there, you aren't able to just kick them out and say that you want to use it for the week.

So the last major advantage is going to be diversified risks. Just like in the last scenario, if you get a good tenant, you can count on that money coming in every month. But what happens if they lose their job or if you have problems with them and need to get them out, the eviction process can take a very long time, it can be very costly. With Airbnb, you have different tenants booking all the time, you never going to have to worry about getting them evicted, or them not being able to pay, you have more ones coming in.

Now, on to the cons for long-term rentals being that you aren't able to use them. Any eviction process can be very difficult, and it's going to be less revenue. So we know less revenue is going to bring a little bit less work as well. But the major con is the eviction process and going to have to deal with different city laws and regulations. Of course, being in Ottawa, we'll talk about how a lot of this stuff doesn't apply because in Ottawa right now, the city says that you actually have to live in your unit as your primary residence to be able to Airbnb, it’s more management is pretty self-explanatory having to deal with the labor tenant board. I know from experience this can get a very costly and drawn-out process.

Now for the cons of Airbnb, it's going to be a lot more work, you're going to have to fully furnish the place and you're going to have to deal with different cities laws and regulations. Of course, being in Ottawa, we'll talk about how a lot of this stuff doesn't apply because in Ottawa right now, the city says that you actually have to live in your unit as your primary residence to be able to Airbnb, it’s more management is pretty self-explanatory, you're going to need to find a cleaner, you're going to need to find someone to manage the property, and of course deal with any Airbnb issues, and finally furnishing it. This can only be costly, but quite a bit of work. I personally hate moving around furniture. I'm joking, but not really.

So finally, when deciding whether you want to Airbnb your property or have it as a long-term rental, there are a few things that you want to consider the first ones being the laws and regulations. Like I said in Ottawa, right now you have to legally be living in the unit. But in a lot of cities, we see an extra tax for Airbnb. And I could also see that's where Ottawa was going in the future. The second one is going to be your ROI or your return on investment. Now we took a look and we saw that okay, Airbnb might be able to get $5,000 versus $2,000 For long-term rental. But you also have to account for all the extra costs and all the extra work. I think in this scenario, it would make sense to Airbnb the property. But if the difference was only $3,000 to $2,000, I would take the long-term rental every time. So the third factor would be, do you want to use this property yourself? If you're buying properties in the city you live in? The answer is probably no. But if you're buying properties outside of the city, or in different cities, you might want to look at Airbnb. So you can also use the property as well. The fourth-biggest one is going to be knowing your market. Is this market prime for Airbnb, or is it prime for long-term rental? What's going to make the most sense depending on where the property is.