by John King,
Broker of Record with Engel & Völkers Ottawa –
Buying a home is one of the most significant financial commitments someone makes in their lifetime. With that in mind, why not try to use your investment to generate additional income and subsidize your mortgage?
I have worked with clients who have used the following techniques to buy into their ideal neighbourhood or increase their equity. Prospective home buyers have a few options they can consider to make money from their property.
Look for Secondary Income Suites
A secondary income suite is a private, self-contained unit within an existing home that can be rented out to supplement your income. While some homes can be purchased with an existing secondary suite, others may simply need some alterations to create one.
The CMHC estimates that having an income suite makes homeownership 22.5% more affordable by offsetting carrying costs. A professional Realtor can set up your home search to focus on homes with existing secondary suites, allowing you to purchase in your preferred area even if prices seem too steep.
Develop a Coach House
Coach houses are self-contained residential units that are detached from your home. An example would be adding a unit within a detached garage, or even building a brand new structure on your lot.
Ottawa recently revised its by-laws to allow for coach houses in areas where the zoning permits. Savvy homebuyers can have their Realtor search for houses with large lots or secondary structures already set on their property that could be converted.
Purchase an Investment Property
If you are a current homeowner who has built up strong equity, you could consider purchasing an investment property. Positive cash flow from a rental property can help contribute toward your mortgage and carrying costs for your principal residence.
While becoming a landlord is a scary concept to some, now is an excellent time to place your equity in this type of investment, as Ottawa home values continue to rise—particularly in core areas that are highly rentable—and interest rates remain historically low. A professional Realtor can pinpoint the factors
that make a property a solid investment and guide
you through the process of buying one that will work for you.