It seems as though more and more of my colleagues and friends want to get into the rental property game. I have sold numerous multiplexes, primarily in the sud-ouest area. The area consisting of Point St Charles, St Henri (little burgundy), Verdun, Cote St Paul and I include Griffintown even though it is mostly in the Ville Marie sector. Duplexes, triplexes, fourplexes and fiveplexes are what most people are looking for. The main reason is because once you go over 5 units, the banks require a much higher down payment. Even if the property is entirely residential a sixplex is viewed as commercial in the eyes of most lenders. The allure of revenue properties is really quite simple. It is all about value! It's not hard to see why buying a duplex for $300,000 and having a tenant pay you $800 per month to live in half of it is more attractive to a lot of buyers than picking up a condo for the same price and tacking on outrageous condo fees. Not to say that it is never a good idea to buy a condo! Being a landlord is not for everybody! There are management companies out there that will help alleviate the workload of rent collection and maintenance for the people who want to get into the revenue property game with having to do all the hands on stuff. It obviously cuts into the profit but it is a great option for people who don't want to do that sort of thing. A great management company in the Montreal area is Gestion Jaktiva: http://jaktiva.com/ From commercial office space to furnished apartments they will help do the dirty work. It is definitely comforting to know that you have revenue coming in to help bear the cost of the mortgage. Even at today's low rates. They will go up eventually unfortunately! Some buyers want them stricly for revenue, but for a lot of people it's a great way to afford a property without having to handle an entire mortgage on their own. You just have to make sure that you screen the tenant so you know that rent cheque won't bounce!
I have noticed lately during a search with a buyer in St Henri that good quality affordably priced multiplexes are getting harder and harder to come by. Anything desireable typically sells very quickly. With the condo boom came the reconfiguration of many buildings that used to be multi dwelling properties. Now we are seeing a lot of co-properties, lofts and condos. New revenue properties are very scarce. The cost of land in Montreal is so high and the profit margin for condos is typically much greater. It makes it nearly impossible for people to find affordable apartments to rent in decent areas of the city though! I think we need to see some new plexes coming back sooner than later. I have clients looking to buy properties like that, and tenants looking to rent them! So a message to all you builders out there! Let's relax on the condos for a minute and think about some new multiplexes! Or I might just have to go and build them myself!