Buying More Investment Properties

by Sally
(Sechelt, BC)

I have 2 investment condos currently that cover their expenses. I have the ability to make a rental suite in my house too. I would like to buy 1 or 2 more investment properties but am currently out of the workforce (writing a book). I have money sitting in an RRSP (doing nothing!) which I would be happy to take out for a downpayment if I could get financing for the rest. I heard that if you have multiple properties (4?), banks may consider you an investment business and then not look at your income anymore as a condition of financing your investments. Is that true?

Comments for Buying More Investment Properties

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May 09, 2012
Income for investments
by: Virata Gamany

It's not true in my experience either. Banks are very interested in income - it defines the risk of the investment. A good suggestion, although it might take you a bit longer, is to take that RRSP and place a mortgage in it. If you can afford it, you can pay off one of your mortgages for an agreed-to, lower rate than what you're currently paying to the bank that holds the mortgage. You then pay it back monthly just like you would a mortgage payment, except now you're paying less than you did before, increasing your amount of available monthly cash. That money can then be taken and reinvested. Again, it may be a longer-term strategy, but a bit more sound.

Apr 19, 2012
RE: Buying More Investment Properties
by: Tom Karadza

That’s not true from our experiences. We’re not the bank of course but from our experience the bank is more interested in your income and debt ratios than they are with the number of properties you own.

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