180-Day Full Unit Rentals or Unlimited Room Rentals: Which Short-Term Rental Strategy Works Best For You?

Toronto’s short-term rental market is changing fast, and with the city enforcing stricter regulations, hosts now face a crucial decision: Should you rent out your entire apartment under the 180-day limit, or opt for the flexibility of renting rooms year-round? This decision can dramatically impact your income, workload, and overall hosting experience. So, let’s break down the factors—location, room rates, occupancy, and guest preferences—that should guide your strategy.

First, Location is Everything

Toronto’s neighborhoods vary widely in rental demand, and where your property is located plays a big role in which strategy will work best. If your property is in a high-demand area like the downtown core, near universities, or in trendy spots like Queen West, renting out your entire apartment could yield high per-night rates. Guests looking for whole apartments in these areas are often tourists, families, or larger groups willing to pay a premium for privacy and centrality. These areas typically see high occupancy, even if you’re limited to 180 nights per year. Think of it like maximizing your revenue per booking.

However, in quieter residential areas where demand might fluctuate, the unlimited partial-room option could be more lucrative. Renting out individual rooms on a year-round basis works better in these less tourist-heavy zones. Why? It keeps your property occupied during off-peak seasons when entire-apartment bookings might slow down. Long-term, consistent income in exchange for fewer guests per night could be a more stable play.

Room Rates: High per Night vs. Steady Income

Let’s talk numbers. Whole apartments, especially those that sleep multiple guests, generally command higher nightly rates. You can expect to charge significantly more for a large, fully equipped space that accommodates groups than for a single room. But here’s the catch: You’re capped at 180 nights. While those high rates may look appealing, you need to consider whether you’ll book out those nights consistently enough to hit your income goals. Are you in a location where tourists book far in advance for extended stays, or are you competing in a crowded market?

On the other hand, renting out rooms individually year-round can provide a more stable, predictable income stream. If your property has multiple bedrooms, renting each one separately could keep money flowing in, even during slower months. Sure, the rates per night might be lower, but over the course of the year, this strategy could lead to higher total earnings. This is especially true if your property is near universities or businesses, attracting students or professionals looking for budget-friendly options.

Occupancy Rates: Can You Keep it Booked?

For whole-home rentals, occupancy rates can be a double-edged sword. High demand areas can keep your place booked solid for the full 180 days, making the most out of the cap. But what happens if you can’t fill those nights? A low occupancy rate means leaving money on the table, as those missed nights won’t roll over to the next year. You either maximize the 180-day cap or lose income potential altogether.

Partial-room rentals, however, allow for more flexibility and potentially higher occupancy throughout the year. With fewer rooms to fill at any given time, you’re more likely to maintain steady bookings. Moreover, renting out a few rooms at once means you’re not solely reliant on landing one big booking to fill the whole place. If one room is vacant, the others can still generate income. Think of it as diversifying your hosting portfolio.

Who Should Choose What?

So, which type of host are you?

• The Full-Apartment Strategist: If your property is in a hot spot, you’re confident in your ability to keep it booked for peak times, and you want higher short-term gains, the 180-day cap could work in your favor. This option works best if you prefer fewer guest interactions and higher per-night payouts, and if your place is in high demand for large groups or families.

  
  

• The Consistent Room-Renter: If you value consistency, have a property in a more residential or slower market area, or don’t mind managing multiple guests simultaneously, renting out rooms individually is your best bet. This strategy allows for year-round income, lower vacancy risk, and flexibility in pricing, especially if you're located near schools, offices, or residential hubs.

Key Takeaway: Know Your Market, Play to Your Strengths

Ultimately, there’s no one-size-fits-all approach. Your location, target audience, and willingness to manage frequent guest turnover all play into which strategy will work best for you. Whole-home rentals are fantastic if you’re in a prime location with strong seasonal demand, while room rentals provide more stability and year-round earning potential.

Ready to make your choice? Analyze your market, check your rates, and pick the strategy that aligns with your goals. The key is to stay adaptable and maximize every opportunity that Toronto’s rental landscape throws your way!