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West Kelowna's high rental vacancy rate is a Canadian rarity


Canada hit an historically low rental vacancy rate in 2023 but West Kelowna not only increased its vacancy rate it's one of few Canadian cities to have what is considered a healthy vacancy rate.

In 2023, West Kelowna had a rental vacancy rate of 4.5%, up from 3.5% the previous year. Anything more than 3% is considered healthy, at least for renters.

The national rate was 1.5% while Kelowna and Kamloops both came in at 1.3%, according to Canada Mortgage and Housing Corporation data.

READ MORE: Kamloops, Kelowna buck national rental vacancy increase trend

Both Penticton and Vernon improved their rates with Penticton going to 1.5% from 1.1% and Vernon to 1.2% from 1.1%.

Of the BC cities listed on the site, only Fort St. John fared better than West Kelowna with a rental vacancy rate of 5.5%, down from 10.6% in 2022.

“The City of West Kelowna’s vacancy rate is largely attributable to the recent increase in purpose-built rental units constructed in the last five years, primarily within the Westbank Urban Centre,” Brent Magnan, the city’s director of development approvals, said in an email to

Tax exemptions are used in Kelowna to encourage more rental construction but that’s not the case in West Kelowna.

READ MORE: How a $500 tax break gets rental housing built in Kelowna

“I think the attraction of new rentals had more to do with the historic lack of purpose-built rentals in the city than anything,” Magnan wrote. “We do have some incentives in the zoning bylaw specific to Westbank Centre and some of the developments were able to bring on additional units utilizing these, such as providing cash in lieu for reduced parking requirements.”

One important impact of the higher vacancy rates is that West Kelowna is now in a position to apply for an exemption to the new provincial short-term rental rules.

Those require the owners to be the principal residents in the units they rent. Any community with a vacancy rental rate of 3% or more for two consecutive years can apply for an exemption to that rule.

West Kelowna city council has talked about applying for exemptions for resort-oriented developments like the Cove and Barona Beach Resort.

Kelowna city council was told earlier this week that similar buildings in that city need not apply since its rental vacancy rate continues to be less than 3%.

READ MORE: No exemptions for Kelowna property owners wanting to stay in short-term rental market

“We are also currently exploring options related to our short-term rental program, provincial exemptions and the impact on tourist accommodation units,” Magnan said in the email. “Staff anticipate bringing a report forward to council at the end of February.”

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