Niagara Falls ON Short Term Rental Rules, Regulations & Laws [2025]

Last Updated on September 18, 2025 by Fullhome Airbnb Manager

Niagara Falls, ON requires all short-term vacation rental hosts to obtain a Vacation Rental Unit (VRU) license, pay a $500 initial fee plus $250 annual renewal, collect a $2 per night Municipal Accommodation Tax (MAT), and follow strict zoning, building, parking, insurance and safety rules. Operating in non-commercial zones or without a license can result in fines up to $50,000 for a first offence, and $100,000 for repeated violations.

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Introduction

Tourism in Niagara Falls drives strong demand for short-term rentals, but hosts must navigate strict laws to avoid huge fines or forced shutdowns. Whether you’re starting your first Airbnb or managing multiple properties, understanding Vacation Rental Unit (VRU) regulations is essential.

In 2025, Niagara Falls has clear rules around licensing, zoning, safety, and taxation. Want to legally host without legal headaches? This guide will walk you through:

• Who needs a license and how to apply

• Where STRs are allowed (which zones)

• What safety, insurance & occupancy standards must be met

• What penalties you could face for non-compliance

With this knowledge, you’ll see how FullHome ensures you meet every requirement, minimize risks, and focus on profitable hosting instead of legal uncertainty.

Overview of Niagara Falls STR Bylaws & Licensing Requirements

In Niagara Falls, short-term rentals are formally regulated as Vacation Rental Units (VRUs). The city created a licensing framework to balance the needs of tourism with housing availability and neighbourhood safety.

🔹 What Counts as a Short-Term Rental (VRU)

• Any rental of 28 days or less offered to the public.

• Applies to listings on Airbnb, VRBO, Booking.com, or private channels.

🔹 Zoning Restrictions

• STRs are only permitted in specific commercial and tourist zones.

• Residential neighbourhoods are generally restricted to protect housing stock.

• Always check the property’s zoning before applying for a license.

🔹 Licensing Requirements

• All STR operators must apply for a Vacation Rental Unit (VRU) license from the City of Niagara Falls.

• Initial application fee: $500.

• Annual renewal fee: $250.

• License must be displayed on all listings and in the rental property.

🔹 Safety & Compliance Standards

• Proof of liability insurance is required.

• Properties must meet fire code and building standards.

• Minimum parking and occupancy rules apply depending on the dwelling type.

💡 Key Point: Without a valid VRU license, your Airbnb or short-term rental is considered illegal in Niagara Falls.

Operational Rules & Tax Obligations

Once licensed, hosts must follow ongoing requirements to remain in good standing with the City of Niagara Falls.

🔹 Occupancy & Guest Limits

• Maximum occupancy is tied to the Ontario Building Code and fire safety standards.

• Typically, no more than two adults per bedroom are allowed.

🔹 Municipal Accommodation Tax (MAT)

• Niagara Falls requires hosts to collect a $2 per night MAT from guests.

• Platforms like Airbnb may collect this automatically, but hosts remain responsible for accurate reporting and remittance.

🔹 Insurance Requirements

• Hosts must carry minimum $2 million liability insurance.

• Proof of coverage must be provided at licensing and renewal.

🔹 Safety & Inspections

• Properties are subject to fire, building, and bylaw inspections.

• Hosts must maintain smoke alarms, carbon monoxide detectors, and emergency exits.

🔹 Record Keeping

• Hosts must keep detailed booking logs for at least three years, including:

  • Guest names

  • Dates of stay

  • Fees charged

  • Platform used

🔹 Advertising Rules

• The VRU license number must be included in all advertisements and online listings.

💡 Reminder: Failure to follow these rules can lead to immediate license suspension or permanent revocation.

IV. Step-by-Step Compliance Checklist

Follow this simple checklist to keep your Niagara Falls Airbnb or vacation rental fully compliant:

✅ Check zoning – Confirm your property is in an eligible STR zone (tourist/commercial).
✅ Apply for a VRU license – Submit your application to the City and pay the $500 fee.
✅ Provide insurance – Show proof of $2M liability coverage.
✅ Pass inspections – Ensure your property meets all fire, building, and safety codes.
✅ Display license number – Post it in your property and on all listings.
✅ Track occupancy – Follow fire/building code limits and max 2 adults per bedroom.
✅ Collect & remit MAT – Charge the $2/night Municipal Accommodation Tax and remit as required.
✅ Maintain records – Keep booking logs for at least 3 years.
✅ Renew annually – Pay the $250 renewal fee to keep your license active.

💡 Pro Tip: Many Niagara Falls hosts partner with FullHome to handle compliance, taxes, and guest management — saving time and avoiding costly mistakes.

How FullHome Helps Hosts Stay Compliant in Niagara Falls

Running a short-term rental in Niagara Falls can be highly profitable, but strict VRU bylaws make compliance a challenge. Missing a renewal date or failing an inspection can cost thousands in fines. FullHome removes that burden so you can focus on maximizing guest bookings.

🔹 End-to-End Licensing Support

We handle VRU license applications, renewals, and zoning checks to ensure your property is always legally cleared to host.

🔹 Tax & Reporting Made Simple

Our team manages the $2/night MAT tax collection and remittance, so you never risk falling behind on city requirements.

🔹 Compliance Monitoring

Bylaws in Niagara Falls evolve as tourism grows. We stay on top of every change and adjust your listing compliance accordingly.

🔹 Safety & Inspection Readiness

From fire code requirements to insurance verification, we keep your property inspection-ready year-round.

💡 With FullHome, Niagara Falls hosts can grow their rental income without worrying about legal risks, missed paperwork, or sudden fines. 

FAQs About Niagara Falls STR Rules

1. Do I need a license to run an Airbnb in Niagara Falls?

Yes. All short-term rentals must have a Vacation Rental Unit (VRU) license issued by the City of Niagara Falls.

2. How much does a Niagara Falls Airbnb license cost?

The initial VRU license fee is $500, with an annual renewal fee of $250.

3. Where are short-term rentals allowed in Niagara Falls?

STRs are only permitted in designated tourist and commercial zones. Most residential areas do not allow STRs.

4. What taxes apply to short-term rentals in Niagara Falls?

Hosts must collect a $2 per night Municipal Accommodation Tax (MAT) from guests and remit it to the City.

5. What happens if I operate without a VRU license in Niagara Falls?

Operating without a license can result in fines up to $50,000 for a first offence and $100,000 for repeat violations.

6. Do I need special insurance for an Airbnb in Niagara Falls?

Yes. Hosts must provide proof of at least $2 million in liability insurance when applying for or renewing their license.

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Resources

1. https://niagarafalls.ca/city-hall/planning/owner-occupied-short-term-rentals.aspx
2. https://letstalk.niagarafalls.ca/oostr
3. https://letstalk.niagarafalls.ca/oostr/oostr-notice-of-adoption
4. https://niagarafalls.ca/news/812-city-of-niagara-falls-launches-pilot-project-for-owner-occupied-short-term-rentals.news
5. https://niagarafalls.ca/city-hall/planning/owner-occupied-short-term-rentals.aspx
6. https://niagarafalls.ca/living/municipal-accommodation-tax.aspx
7. https://www.bnbcalc.com/blog/short-term-rental-regulation/Niagara-Falls-Canada-Guide
8. https://www.niagarafallsreview.ca/news/council/owner-occupied-vacation-rentals-approved-for-niagara-falls-neighbourhoods/article_77d2684c-ff58-5402-a91c-9079af2233b1.html

Licensing Requirements 

• Licence Cap: https://www.niagarafallsreview.ca/news/council/owner-occupied-vacation-rentals-approved-for-niagara-falls-neighbourhoods/article_77d2684c-ff58-5402-a91c-9079af2233b1.html].
• Separation Distance: https://letstalk.niagarafalls.ca/oostr/oostr-notice-of-adoption].
• Licence Fee:  [https://www.niagarafallsreview.ca/news/council/owner-occupied-vacation-rentals-approved-for-niagara-falls-neighbourhoods/article_77d2684c-ff58-5402-a91c-9079af2233b1.html].

Operational Rules and Taxation

• Occupancy Limits:
  • [https://www.lodgify.com/guides/short-term-rental-laws-ontario/].
  • [https://www.niagarafallsreview.ca/news/council/owner-occupied-vacation-rentals-approved-for-niagara-falls-neighbourhoods/article_77d2684c-ff58-5402-a91c-9079af2233b1.html].
• Municipal Accommodation Tax (MAT):   [https://niagarafalls.ca/living/municipal-accommodation-tax.aspx].