Aahil Matcheswala and Tracey Choy built their property management and investment business, Dongle Capital, from their home base in Kitchener-Waterloo. They started by renting out their basement’s single room on Airbnb to overseeing about 60 properties across the country.

The pair call themselves “the Airbnb experts,” with their bread and butter being helping residential owners manage their properties on a short-term rental basis. 

The service

“That basically includes everything,” says Choy. “Someone just has a home. They want to put it up for short-term rentals. They don’t know how. They don’t want to take care of it. They hire us and we’re going to help them, give advice on how to furnish it, make sure that it’s visually and operationally ready for a short-term rental.

Then we create the listing for them. We onboard it completely so we take care of all the guest communication, prepare them for check-in, check in with them during their stay and after they check out, assess for any damages and basically reset the whole property (for the next rental).”

The journey: ‘We didn’t have the real estate investment or business mindset whatsoever … it changed quickly’

The duo’s concept began at the end of 2020 when they bought their first home for $600,000 outside of Toronto after renting and working corporate jobs downtown in the city. They started by renting out a room in their new home on Airbnb. Despite having no prior experience, their first Airbnb brought in $5,000 a month, with expenses of just $2,900. This sparked an interest in property management, and soon friends and family were asking them to manage their properties.

“We didn’t have the real estate investment mindset or business mindset whatsoever, but when we saw that type of cash flow come in, it changed really quickly and we bought a second property and did the same thing basically,” recalls Choy. “One thing led to another and we were able to create a business out of it.”

Future growth on the horizon

Today, they own two properties and manage about 55 units with 75 per cent of them in Ontario and the rest in Nova Scotia and New Brunswick. The business is now generating about $500,000 annually in revenue.

Matcheswala and Choy see future growth on the horizon for the business, which is averaging about two units per month, between 20 and 25 for the year, Matcheswala notes.

Here’s what it takes

“You need really good people that you work with, our teammates. People that we hire, our team that helps us carry out all the property management tasks, and also other subcontractors like cleaners and property managers,” he points out.

Matcheswala explains their value-add and how they’ve kept a lean team is the fact they only have two virtual assistants and leverage technology in every business aspect.

“The first piece is your property management software. Hospitable plays a key role. It’s all reactive stuff because you can’t really control everything and people are going to ask you questions,” he explains. On top of the scheduled messages that go out, he says the program allows them to create property manuals and “basically do a brain dump of all the information you have about the property. It will help you answer questions, create drafts all on its own using AI.”

Tech software is also used in several other areas — including the process of cleaning the properties when people check out to get units ready for the next rental. It also helps with pricing, providing market data for different times of the year.

The business charges a commission anywhere from 15 to 20 per cent of the nightly rental rate. Most clients are more like mom-and-pop operations or small real estate investors with a handful of properties.

Client considerations: What makes a suitable property?

Choy notes that many things must be looked at when they onboard a property or consider if it’s suitable for Airbnb rentals. 

“We have to analyze the design of the property — not that it needs to be super modern, high tech or anything — but it has to appeal to the masses, even if it’s not the owner’s style. (So) there’s a lot of convincing and discussion with the owner about this.”

This means stripping away the personal attachment they have to the property, as it’s now becoming a business. Choy notes this is especially true these days with people being pushed to putting it up for cash flow because of rising interest rates.

“There’s a lot of discussion around security on the property, where our outdoor camera is going to be placed, what type of security locks we need, which is actually one of the big aspects for us,” she explains. “We can never take on a property where an owner is not willing to change the front locking mechanism there from a key to a specific smart lock because that smart lock needs to do a couple of things, (including) hold a lot of different codes.” 

Key elements of successful property management companies

When asked about what makes a property management company successful, Matcheswala mentions the industry has been a very unprofessional one. That makes communication key, which means responding to clients on a timely basis.

Choy agrees that communication is important, also noting resiliency, or “thick skin” being a key element of a successful property management company.

Although Dongle Capital is in the hospitality industry, it serves many real estate investors. “That’s kind of where the lines get blurred,” she points out. “But at the end of the day, it’s customer service. And the customer’s always right, even if it’s not your fault.” Having that thick skin has allowed the pair to be really creative and quick on their feet, Choy says.

The British Columbia Real Estate Association (BCREA) is calling for significant amendments to British Columbia’s short-term rental laws to mitigate the disruption they’ve caused for specific business and tourism sectors across the province, the association announced last week.

On May 1 this year, the B.C. Government enacted a widespread ban on short-term rentals, with the intent of returning homes to the long-term rental market.

British Columbians negatively affected by the ban

As part of a new housing policy resource hub launched leading up to the 2024 Provincial General Election, BCREA identified multiple groups of British Columbians negatively affected by the ban.

These groups include:

• medical employees transferred to remote areas
• those receiving multi-week medical care as well as caregivers in urban areas
• film sector workers in town for weeks at a time
• those attending or employed by short-term but large events for which hotel space is inadequate (such as a Taylor Swift concert or the FIFA World Cup 2026)
• those needing short-term housing due to delays in being able to take occupancy of homes or apartments

The BCREA proposed several exemptions from the ban across several categories, including these groups and high-tourism areas.

Additional considerations besides housing affordability, BCREA stresses

As part of the analysis, the BCREA stressed that provincial and regional economies need to be factored into policy decisions of this magnitude.

“While housing affordability is extremely important, there are additional considerations in communities across B.C. that have been paved over with the implementation of this policy,” explains Trevor Hargreaves, BCREA senior VP, policy and research. “There are numerous exemptions desperately needed to make this a workable and successful policy moving forward.”

Hargreaves adds, “There is no question that some of these short-term rental units should be functioning as long-term rentals, but there are some legitimate uses for short-term rentals that are no longer permitted under the legislation.”

With over 75 per cent of tenants worldwide reporting that rising rents have negatively impacted their quality of life, property managers have the opportunity to differentiate themselves by offering competitive rates and using technology to enhance tenant satisfaction and loyalty.

Capterra explored this through its global survey across 12 countries, with 4,800 tenants, including 400 respondents from Canada, to understand their experiences and perceptions. The results reveal a complex mix of factors influencing the short-term rental market, including rising rental costs, neighbourhood disturbances and tenant satisfaction issues. They also highlight the need for property managers to adopt new technologies and property management tools to improve the tenant experience, especially in the face of external factors driving rent increases.

Rising rents due to short-term rentals: A worry for over half of tenants

Globally, 51 per cent of tenants are concerned about rising rental prices due to short-term rentals, with the same sentiment reflected in Canada.

Among Canadian tenants familiar with the issue, 44 per cent believe short-term rentals have significantly driven up local rent prices.

High rent dissatisfaction in Canada

Globally, 34 per cent of tenants are challenged by high rental costs, while 36 per cent express dissatisfaction with their current rent — a number that’s even higher in Canada, with 39 per cent of tenants unhappy with how much they pay for rent.

Additionally, 76 per cent of tenants globally agree that rising rents have negatively impacted their standard of living. These numbers underscore the need for property managers to foster strong, long-term relationships with tenants through transparent communication and fair pricing strategies.

Impact of short-term rentals on neighbourhood dynamics

30 per cent of tenants globally report noise issues due to short-term rentals, while 29 per cent mention parking problems and 24 per cent express safety concerns. Furthermore, 23 per cent have observed changes in neighbourhood character.

The report suggests that property managers should adopt community engagement strategies to address these issues, helping to build a sense of community and improve tenant satisfaction.

Other key findings

The report also cites that 40 per cent of tenants worldwide support rent control, while 30 per cent favour discounts for timely payments to combat rent inflation. As well, 31 per cent of tenants are willing to pay higher rent for properties equipped with home security systems.

How property managers can strengthen neighbourhood communities

The report goes on to suggest six things property managers can do to strengthen their communities:

1. Enhance security. Install security systems, surveillance cameras and access controls to improve safety and foster a community watch culture.

2. Address congestion. Implement traffic calming measures and develop designated parking spots to reduce congestion.

3. Minimize noise disturbances. Enforce quiet hours and invest in soundproofing to address tenant concerns about noise.

4. Improve waste management. Ensure regular trash collection and provide recycling and waste disposal facilities.

5. Preserve neighbourhood character. Engage tenants in beautification projects and community events to foster neighbourhood pride.

6. Build community ties. Partner with local businesses, organize community service projects and promote diversity and inclusivity to create a welcoming environment.

Review the full report here.

Zoocasa looked at the question as the allure of short-term rentals through platforms like Airbnb loses its shine as cities across North America tighten regulations. The latest to join this trend is New York City, which recently enacted a law prohibiting rentals for fewer than 30 days, a move that echoes the efforts of several Canadian cities. 

These changes are largely driven by the need to address housing shortages, with policymakers hoping to return more properties to the traditional long-term rental market.

New regulations for short-term rentals

Short-term rental regulations are becoming increasingly commonplace, with many Canadian cities already implementing limitations. For instance, Zoocasa notes that as of Sept. 1, Halifax has restricted how units can be rented in residential zones and now mandates basement apartments or backyard suites to be rented for more than 28 days. Meanwhile, Toronto imposes a maximum limit of 180 days per calendar year for short-term rentals, and the British Columbia government is drafting its own set of laws governing short-term rentals.

Zoocasa’s analysis compared monthly rental prices with monthly mortgage payments for the average condo in each city. Additional costs, such as utilities and property taxes, were not factored into this analysis.

The cost of renting vs. owning

In August, Rentals.ca reported an annual increase of 8.9 per cent in rent prices, reaching a record-high average rent of $2,078 across Canada, while the average price of a condo in most cities did not experience a parallel surge.

Among the 12 cities where average condo mortgage payments were found to be lower than rent, Calgary stood out with the most substantial difference. With an average monthly rent of $1,920 and an average monthly mortgage payment for a condo at $1,355, investors could see a monthly surplus of $565.

Similarly, other Alberta cities like Edmonton and Lethbridge also presented mortgage payments lower than the average rent, while Grande Prairie bucked the trend with average monthly condo mortgage payments surpassing average rent by $619.

Beyond the Prairies, Quebec and the Maritimes also offer favourable conditions for investors. In Halifax, where the average rent is $2,061, the monthly mortgage payments for an average condo total $1,956. In Quebec City, monthly mortgage payments on a condo average $1,009 — less than $401 compared to the average rent in the city.

Source: Zoocasa

Ontario’s unique challenges

However, Zoocasa’s analysis indicates that Ontario presents a distinct challenge for condo investors. With the exception of Windsor and Ottawa, where monthly mortgage payments for the average condo are lower than rent, all other cities in Ontario analyzed in the study had monthly mortgage payments higher than rent.

Toronto, boasts the second-highest average monthly rent on the list, at $2,981, while the average monthly mortgage payment for a condo reaches $3,451 — a difference of $470. Other Ontario cities, including Guelph, Barrie, Hamilton, and St. Catharines, also recorded relatively higher mortgage payments when compared to rent costs.

Lauren Haw, Zoocasa’s broker of record and industry relations officer, emphasized the challenges that rising interest rates pose to condo investors. She noted, “Condo investors continue to have a hard time covering carrying costs, and they’re not making a profit, which is leading many to sell their investment properties.”

Investor interest persists

Despite these challenges, investor interest in real estate remains. The Bank of Canada reports that investors accounted for 30 per cent of home purchases in the first quarter of 2023, and the central bank’s recent decision to pause interest rate hikes and maintain the overnight lending rate at 5.0 per cent suggests that demand for investment properties may continue to grow.

Read Zoocasa’s full analysis here.