Toronto real estate prices are out of control, and for many buyers, homeownership feels out of reach. But what if there was a strategy that allowed you to afford a home in Toronto while generating rental income to offset your mortgage?
This concept—sometimes called “house hacking” or hybrid homeownership—lets you live in your property while making it work for you financially. Instead of stretching your budget to afford a home, this approach makes your home pay you back.
🚀 In this post, we’ll break down:
✔️ How this strategy works in Toronto
✔️ A real example of a home that generates rental income
✔️ The financial breakdown of homeownership vs. investment
✔️ How CMHC-backed loans can help buyers invest in multiplex properties
Let’s dive in!
Why Homeownership Alone Isn’t Enough
For decades, homeownership has been seen as the ultimate investment—but is it really?
Owning a home provides stability, customization, and long-term equity, but it doesn’t generate monthly income. Every month, you pay your mortgage, property taxes, and utilities—without getting anything back.
🔴 The Reality:
- A typical Toronto home costs $900,000+, requiring massive mortgage payments.
- Property taxes, maintenance, and rising interest rates make ownership even pricier.
- If your income doesn’t rise fast enough, homeownership alone can feel like a financial trap.
✅ The Smarter Alternative: Homeownership + Investment
Instead of taking on 100% of the cost, why not have a rental unit help cover your mortgage?
How the Hybrid Homeownership Strategy Works
Rather than buying a single-family home with no income potential, look for properties with an additional rental unit—like a duplex, triplex, or a home with a legal basement apartment.
🏡 Example: 70 Dunraven Drive
- Type: Bungalow with a separate basement unit
- Purchase Price: $899,999
- Rental Income from Basement Unit: $1,350/month
- Adjusted Monthly Costs: 29% lower than a traditional home!
Instead of struggling to afford a home, this strategy allows buyers to build equity while generating rental income.
Financial Breakdown: Traditional vs. Hybrid Ownership
Let’s compare three different scenarios:
Scenario 1: Traditional Homeownership (No Rental Income)
- Home Price: $899,999
- Down Payment: $180,000 (20%)
- Mortgage Amount: $719,999
- Monthly Mortgage (4.5% over 25 years): $4,002
- Other Costs (Taxes, Utilities, Maintenance): $650
- Total Monthly Costs: $4,652
🚫 No rental income, full cost burden on the owner.
Scenario 2: Hybrid Homeownership with Rental Income (20% Down)
- Same Home Price: $899,999
- Down Payment: $180,000 (20%)
- Mortgage Amount: $719,999
- Monthly Mortgage (4.5% over 25 years): $4,002
- Other Costs: $650
- Rental Income: $1,350/month
- Adjusted Monthly Costs: $3,302 (29% savings!)
✅ Rental income helps offset mortgage costs, making homeownership more affordable.
Scenario 3: Hybrid Homeownership with CMHC Loan (7.22% Down)
- Home Price: $899,999
- Down Payment: $65,000 (7.22%)
- CMHC Insurance: $33,400
- Mortgage Amount: $868,399
- Monthly Mortgage (4.5% over 25 years): $4,827
- Other Costs: $650
- Rental Income: $1,350/month
- Adjusted Monthly Costs: $4,127
✅ A CMHC-backed loan allows buyers with smaller down payments to enter the market while still offsetting costs.
CMHC Multiplex Financing: Making Investment More Accessible
Did you know that CMHC allows buyers to finance up to 85% of a multiplex property?
This means that even if you don’t plan to live in the home, you can still use this strategy to invest in income-generating real estate with a lower down payment.
💡 CMHC Perks for Multiplex Buyers:
✔️ Up to 40-year amortization for rental properties
✔️ Lower down payment requirements (15%–20% instead of 25%)
✔️ Incentives for energy-efficient or affordable rental units
This makes it easier than ever to buy a property that generates wealth instead of just being an expense.
Why Toronto’s Bungalows Are Perfect for This Strategy
🏡 Bungalows are one of Toronto’s best-kept secrets for investment. Here’s why:
✔️ Many already have basement units (or can easily be converted).
✔️ Larger lots offer room for expansion (like adding a second floor or garden suite).
✔️ They are common in areas like Eglinton West, Weston, and Scarborough, where property values are still growing.
Final Thoughts: Own a Home & Invest at the Same Time
Toronto’s real estate market is tough—but you don’t have to choose between homeownership and investment.
By buying a home with a rental unit, you:
✅ Offset your mortgage costs
✅ Build equity faster
✅ Set yourself up for long-term wealth
💡 Want to learn more? Watch the full video here: [WATCH HERE]
📩 Thinking about buying in Toronto? Let’s chat! Book a consultation 👉 [Calendly]
