Montreal is hosting the 2026 F1 Canadian Grand Prix in May. Tens of thousands of race fans will flood the city. And according to a new economic study commissioned by Airbnb, the city already banned the one accommodation model that could actually handle the surge.
The number that keeps coming up: $19 million CAD in lost tourism revenue. In a single event weekend.
The Study Every City Council Should Read Before Voting
In March 2026, Raymond Chabot Grant Thornton (RCGT) — one of Canada’s largest professional services firms — published an economic analysis commissioned by Airbnb on Montreal’s seasonal STR ban. The headline finding is hard to argue with. Montreal’s ban creates a 26,000-night accommodation shortfall during the 2026 F1 Canadian Grand Prix (May 22–24), with a projected $19 million CAD in lost tourism economic activity.
That’s not hypothetical. Those are bookings that don’t happen, visitors who don’t come, and dollars that don’t circulate through restaurants, shops, neighborhoods, and local businesses — because the accommodation supply simply won’t exist.
“Montréal’s seasonal short-term rental ban will result in a shortfall of 26,000 available nights during the 2026 Formula 1 Canadian Grand Prix, representing an estimated $19 million CAD in lost tourism economic activity.” — Raymond Chabot Grant Thornton (RCGT), “Montréal seasonal short-term rental ban risks millions in tourism revenue,” commissioned by Airbnb, March 2026
The full study was published through Airbnb’s newsroom and syndicated at Hospitality Net.
The F1 2026 Calendar Doesn’t Negotiate With Housing Policy
The Formula 1 2026 season runs 24 races across 20 countries — from Bahrain in March to Abu Dhabi in December. Montreal sits at Race 7 on the calendar: Circuit Gilles Villeneuve, May 22–24. The city is one of the sport’s most beloved venues, drawing fans from across North America and Europe who plan their trips specifically around this race.
Montreal’s STR ban window runs November 1 through September 30. That covers the entire F1 Grand Prix weekend. It also covers the UCI Road World Championships, landing September 19–27 in Montreal — another global draw with athletes and fans from over 100 countries attending.
Two massive international events. One ban window. And a city that removed the accommodation infrastructure exactly when it would matter most.
What Happens When Hotels Hit 160%
Here’s what the market does when accommodation supply gets squeezed and demand spikes: prices surge until demand disappears. Hotel rates in Montreal during the F1 Grand Prix are already up 160% above baseline. That’s not a functioning market — that’s a warning signal.
When hotel prices spike beyond what most visitors can absorb, those visitors don’t book anyway and complain about it. They cancel the trip. They go to Austin. They go to Miami. They go somewhere with enough accommodation to actually host them, and Montreal gets none of that spending — not at hotels, not at restaurants, not at the Circuit, not anywhere.
Hotels can’t solve this problem. Their business models require consistent, year-round occupancy. They can’t scale capacity for 72 hours of peak demand on a race weekend. The infrastructure that does that — private homes, condos, apartments available for short stays — is exactly what short-term rental operators provide. And Montreal banned it during the only window that mattered.
Think of STR Operators as an Import-Export Business
Most people get this argument exactly backwards. They see short-term rentals and think: housing competition. Here’s the frame that actually describes what’s happening.
We’re an import-export business. What we export is the experience of the local economy — the food, the culture, the neighborhood, the feel of a place that you can only get by staying there. What we import is money. People travel from outside the area specifically because accommodation exists. They find a place to stay, and then they spend — at the coffee shop on the corner, the restaurant with no hotel deal, in parts of the city the big hotel chains don’t reach.
That’s no different from what a sports team does for a city. When fans travel to a game, the whole ecosystem benefits. STR operators serve the same economic function at the accommodation layer — quietly, every weekend, not just during 41 home games. Montreal banned that. The RCGT study put a number on what that decision costs.
Hotels Cannot Surge for a Weekend
Here’s what cities misunderstand: hotels are built for consistent, year-round occupancy. Their economics require it. They can’t scale capacity for a single weekend the way STR supply can.
When 50,000 F1 fans show up to Montreal for 72 hours, there is no hotel you can build fast enough to serve that demand. The infrastructure that does exist — private homes, condos, apartments available for short stays — is exactly what STR operators provide. And Montreal banned it during the one window when it would matter most.
There’s a reason global cities competing for major events specifically cultivate their STR ecosystems before those events. Austin didn’t build 26,000 new hotel rooms before its first F1 race. Miami didn’t either. Their STR markets absorbed the demand surge. Montreal’s market can’t. The city chose that.
The Double Impact — UCI World Cycling Championships
F1 is not the only casualty in Montreal’s ban window. The UCI Road World Championships land September 19–27, 2026 — still inside the ban. This is one of the most prestigious cycling events in the world, pulling athletes and dedicated fans from more than 100 countries.
The RCGT study projects that both events combined represent over $30 million CAD in potential lost economic activity. A policy sold to residents as a housing protection measure is functioning as a multi-million dollar tax on the city’s hospitality economy. Those aren’t the same thing, and they shouldn’t be treated as if they are.
The Cities That Changed Their Minds
If you’re an STR operator watching your city debate similar restrictions, here’s what the research actually shows about whether these bans are permanent.
They often aren’t. Several cities have softened or reversed STR restrictions after facing economic reality head-on — through commissioned studies, major event pressure, or legal challenges requiring adequate economic analysis before policy could stand.
Ocean City, Maryland reversed a 2024 ordinance banning new STR permits in residential zones in March 2026. Hotel occupancy had hit 94% peak-season, but visitor spending had dropped 18% year-over-year. The market told the truth the policy didn’t want to hear. The city re-opened permits with new host-residency requirements.
Dallas, Texas paused STR enforcement in its Entertainment Districts during FIFA World Cup 2026 preparations, citing a projected $375 million in visitor spending. Economic pressure at that scale changes the political calculus.
South Lake Tahoe, California had its 2021 STR ban overturned by a Placer County Superior Court in 2025. The court found the city had failed to conduct adequate economic impact analysis — specifically around downstream effects on service workers whose livelihoods depended on STR-generated visitor traffic. New regulations required. Full ban nullified.
San Diego, California faced a citizen referendum backed by 62,000+ signatures after economic modeling showed STRs generate $1.1 billion annually in visitor spending. The city quietly walked back proposed caps from 1% to 5% of housing stock.
Maui, Hawaii delayed a complete STR ban vote twice after a commissioned study showed STR activity generates $900 million per year in direct and indirect economic activity. The compliance timeline was pushed from 2024 to 2027.
The consistent pattern: economic evidence changes the political calculus. The trigger is either a commissioned impact study, acute event-driven demand pressure, or a legal challenge requiring economic justification. Montreal now has that evidence in writing. Whether city council acts on it is a separate question.
The Housing Shortage Argument Doesn’t Hold Up
Let me address the argument that always shows up in these debates: that short-term rentals cause housing shortages.
I’ll be direct — this doesn’t hold up under scrutiny. The property being used as a short-term rental would not have been in the rental range of the person pointing to a housing shortage. We’re not talking about the same two properties. We’re not even talking about the same demographic.
Properties that function well as STRs are in neighborhoods and price points that don’t overlap with the housing stock people facing a shortage actually need. You can’t apply broad strokes to this argument. The housing shortage is a real problem. Its causes are real: zoning restrictions, construction costs, decades of underbuilding. STR operators are not the cause of it.
What STR operators often are — and this gets ignored — is the reason property conditions improve. When you put a listing together, you photograph it in its most pristine condition, and you have to maintain that standard or bad reviews put you out of business. That accountability loop doesn’t exist in long-term rentals the same way. Traditional landlords are often incentivized to keep a tenant in place without investing in the property. Long-term rental cash flow frequently equals deferred maintenance — a landlord collects rent for three years, the roof needs replacing, and three years of cash flow disappears. STR operators can’t run that model. The guest reviews won’t allow it.
What to Do If Your City Is Debating Restrictions Right Now
If you’re watching an STR debate unfold in your market, here’s what I’d tell you: get ahead of it. Embrace the restrictions.
That sounds counterintuitive. But restrictions define the marketplace. Think about car safety — seatbelts, brakes, a steering wheel. Brakes restrict your speed, but they give you control and they make the car lendable, insurable, and marketable. When STR restrictions come into place, lenders begin to understand the asset class. When STR is a free-for-all with no rules, nobody will lend against it. When the rules are defined, capital follows.
There’s no such thing as a permanently stable regulatory environment. That’s true for restaurants, for cars, for real estate. Rules change — they always have. Expecting stability is the wrong frame. The right frame is: when the rules change, are you positioned to still be in the game?
The operators who stay when restrictions tighten are the ones who are serious. The fly-by-night investors exit. The people who got in because it seemed easy leave. What remains is a more credentialed market — and that makes it safer and more profitable to go bigger for the operators who stayed.
Restrictions aren’t prevention. They’re definition. And definition is what every serious market needs to attract capital.
The Bottom Line on Montreal
Montreal is about to host one of the world’s most-watched motorsport events. The economic study is on record. The 26,000-night shortfall is documented. The $19 million loss figure has a credible author and a published methodology.
If you’re building an STR portfolio, this story isn’t about Montreal’s mistake. It’s about the data infrastructure you need to make the same argument in your own market before the vote happens — not after.
The operators who show up with numbers change the conversation. The ones who show up angry after the fact do not.
If you want to build an STR portfolio that holds up through policy cycles — in markets others are running away from — that’s exactly what we work through at CashFlowDiary.
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FAQ
Have any cities actually reversed STR bans after economic impact studies?
Yes — several. Ocean City, Maryland reversed a ban in March 2026 after visitor spending dropped 18% year-over-year despite high hotel occupancy. Dallas, Texas paused STR enforcement ahead of FIFA World Cup 2026 citing $375 million in projected visitor spending. South Lake Tahoe, California had its 2021 ban overturned by a court that found inadequate economic impact analysis in the original Environmental Impact Report. San Diego walked back proposed STR caps after a $1.1 billion economic study. Maui delayed a complete ban vote twice after a $900 million annual economic activity study was published. The consistent trigger is economic evidence — either from commissioned studies or acute event-driven demand pressure.
Don’t STRs cause housing shortages?
The data doesn’t support this framing. STR properties are typically in neighborhoods and price points that don’t compete with the housing stock needed by people facing a shortage. The housing shortage is real — its causes are zoning restrictions, construction costs, decades of underbuilding. STR operators are not a meaningful driver of that problem. A property priced for a short-term rental is not the same property that would house a low-income renter if the STR went away.
What should I do if my city is considering an STR ban right now?
Show up before the vote, not after. Find out when public comment sessions are and attend them. Bring data: your booking numbers, your guest origin data, your local spending estimates, your tax remittance records. Form or join a local host association — a single voice gets ignored, an organized group gets a seat at the table. Ask your city council to commission an economic impact study before the vote. Being the person in the room with numbers is a fundamentally different position than being the person who protests the outcome.
Is the regulatory environment getting better or worse for STRs?
It’s getting more defined — which is better for serious operators than the alternative. Every major market that has introduced registration requirements, noise ordinances, and occupancy limits has also seen professional operators benefit over the long term. The unserious operators exit. Lending becomes available. The asset class develops a track record. The operators who frame regulation as a market-definition event rather than an attack are the ones who come out the other side with a larger portfolio.
Sources
RCGT/Airbnb Study — “Montréal seasonal short-term rental ban risks millions in tourism revenue” — Hospitality Net
Montreal blocks Airbnb rentals for F1 fans — Time Out Montreal
Airbnb Montreal short-term rental rules (March 2026) — CityNews Montreal