Multi-Family Rental and Income Properties

As a real estate investor you have needs that are different from the ones of the general home owner. You think about property value and cash flow, you worry about tenants and maintenance, and you work towards achieving a return on your property. We are here to support you with your real estate investing ventures, specifically when it comes to buying and selling multi-family income properties.

Selling an income / rental property
Selling a multi-residential rental property can be subject to a few challenges. On the one side, there are the legal questions with regard to the tenants who currently live at the property. On the other hand you may be asking yourself about the best timing of a sale and how to go about marketing your property. Plus you may be concerned about the condition of the property with regard to needed repairs.

Legal Considerations

Whether on a fixed term or month to month, the tenant generally has the right to stay in the unit even through the sale of the property. The purchaser will "inherit" the tenant. You might ask yourself what your options are to provide for vacant possession. Your buyer may be looking for vacant possession since they plan to substantially renovate the property or they may want to move in themselves. For own use, you do have the option of serving Form 12. You can do that as soon as you have a signed agreement with the purchaser. The N12 gives notice to the tenant, that they have to move out by a set date (more on Form N12).

A lease can generally not be terminated for renovations. However, you may be able to find an agreement with the tenant and have them sign a Form N11. Maybe you can help them move, help them find a new place or give them a rent free month as an incentive.

In order to get access to the rental property you generally need to give 24 hour notice, and visits have to be scheduled between 8 AM and 8 PM. Best practice is to agree on a process and or schedule together with the tenant, so you don't run into resistance when you want to show the property to a prospective buyer.

See the Residential Tenancies Act for more details.

Buyer's Own Use

Generally, having all units tenant it is a good thing for a real estate investor. You have the necessary cash flow to support your selling price. With smaller investment properties, you might be targeting buyers who want to live in one of the units. Let's say you are trying to sell a triplex with a nice main or upper suite that is appealing to a live-in owner. Having one of those units on a month to month as opposed to a fixed lease would be critical. A month-to-month tenant can be terminated making space for the buyer to move in (see Form N12).

Condition of Property & Timing

If your property is recently renovated, partially or fully, chances are the rents are close to market, at least for the newly renovated units. Most likely you have placed new tenants in those after the completion of the renos. In this case your buyer will most likely follow a hold strategy and keep the property mid to long-term.

With a more dated property, or a property with some units that are outdated, a buyer will more likely try to lift the property and renovate the units as they become vacant. The goal is to achieve higher rents after completion of the renos, enhancing cash flow and, consequently, property value. Having some of those units vacant can be an advantage since tenancies cannot be terminated for renovations in Ontario. Having too many tenants on long term leases with rents way below market can be a disadvantage.

Marketing & Staging

A good relationship with the tenants in your property will go along way when marketing for sale. Having their cooperation will make many of the required steps much easier, specifically staging and taking great photos.

Here are a few things you can do to prepare your property and make it more marketable:

  • Complete repairs, fixing things that don't work.
  • Check that all lightbulbs are working and replace where needed. Use LED bulbs as a durable low energy option.
  • Consider painting units or specific walls that need a fresh coat.
  • Get a cleaning service in to clean all the units.
  • See if the tenants are willing to de-clutter and keep their unit tidy during the sales process. Maybe the free cleaning as above can be an incentive to do so.


The core of your selling process are the property financials. While a single-family residential buyer will be mostly focused on property features, investors primarily look at numbers. This seems obvious, but we see it all the time that sellers and their agents don't make the effort or simply lack the know-how of putting together a compelling financial sheet or brochure. Investor buyers often skip properties where the financials are hard to come by or seem untruthful. Make sure your numbers are based on facts and are easy to follow. Upon the buyer's due diligence, any discrepancies will come to light and will cause issues. Best of all, choose a realtor who specializes in multi residential income properties. They will know how to properly present the financials to prospective buyers.

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Buying investment properties

You have embarked on an exciting adventure, having made the decision to purchase an income property. Whether you are looking for a diversification from the stock market or trying to build your own retirement fund, you are making a big step towards achieving your goal.


Having your financing ready is the most crucial step when looking to invest in real estate. Generally, you will need 20% down for a residential property. Expect to put down more for larger multi residential or commercial properties. Getting a mortgage for an investment property is harder than for a principal residence. Many first time investors are baffled, when they find out the hard way. Get in contact with your preferred mortgage broker or ask your realtor for a referral. It's tempting to start looking at properties, but you need to get your finance ducks in a row first.

Goals & Strategies

Your goals towards a real estate investment can be multifaceted. Maybe you are interested in strong steady cash flows, or you want a property that appreciates in value over time, or you're comfortable putting in the work and want to sell a property with a profit after doing renovations. Whatever your intentions are, we generally classify the following rental investment options:

  • Small multi-residential property (Duplex, Triplex etc.)
  • Medium size multi (7 to 12 units)
  • Large multi (More than 12 units)
  • Mixed use property (residential combined with office or retail space)

Each has their own pros and cons and comes with their set of rules and challenges.


Based on your strategy and expectations towards cash flow, ROI and/or value appreciation, isolate the locations that are best suited. Focus on no more than 2 areas at a time, where you are most likely to find the desired property. In contrast to a residential buyer, you will not be spending a lot of time physically looking at properties. Most of your time (or your realtor's) is spent at the desk analyzing the details of potential investments. Property visits are often done later in the process, after the analysis shows that the subject property is likely to meet the threshold regarding your investment goals.

When you're ready to make an offer, remember to have financing and home inspection clause in there. If you're working in an area where competitive offers are prevalent, you will need to have your financing bulletproof, as you will not otherwise stand a chance in a multiple offer situation. Leave enough time for performing your due diligence. Checking and verifying all the numbers is absolutely essential.

Investor Resources

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