Home Suite Home

For aspiring homeowners looking to get into a desirable neighbourhood, or the home of their dreams, a rental suite can often make those aspirations a reality. 

The projected income from these suites can be added to the buyers own household income to help qualify for a mortgage. These suites, sometimes referred to as ‘mortgage-helper suites’, are fully self-contained and must be legally permitted and compliant with municipal zoning. 

Cities throughout British Columbia, which suffer the highest cost of living in the country, commonly utilize secondary suites. According to Stats Canada, nearly one-in-six homeowners in the Vancouver region took advantage of mortgage helpers. 

To illustrate the cost savings, we’ve crunched the numbers using an actual property from the gorgeous community of Trailhead at the Ponds in Upper Mission. Carrington Homes’ stunning Davis F model, located at 1113 Collinson Court in Kelowna, is currently listed at $1,349,900. Assuming a 20% downpayment of $269,980, the resulting mortgage is $1,079,920. 

We looked at two different scenarios: one using a 25-year amortization, and the other a 30-year. 

Comparing the Davis F model with a suite and a Davis F without, we reveal the following 

Example using a 25-year amortization* 

With a suite, the homebuyer’s required income is reduced by $25k and pays roughly 29% less in monthly mortgage payments. 

Example using a 30 -year amortization* 

In this scenario, the monthly mortgage output is reduced by more than 30%, while their required annual income drops by $25k. 

The examples above clearly illustrate the tangible benefits a mortgage-helper suite can provide. Whether one is looking to get into an exclusive neighbourhood, a dream home, offset changes to household income (eg., due to maternity leave), or simply accelerate mortgage payments, rental income can significantly help in achieving one’s financial goals. 

If you’re prepared to take the step as a landlord, be sure to brush up on the Residential Tenancy Act. [link] It’s also important to understand the terms of your insurance policy. Disclose your secondary suite to your insurance provider to keep your coverage intact. 

Managing both the tenant and property can seem like a daunting responsibility, however the outcomes can be financially rewarding. 

If you’re interested in learning more or need help navigating the complexities of the mortgage process, reach out to Gord or Stephanie at BlueTree Mortgages West. 

If you’re interested in learning more or need help navigating the complexities of the mortgage process, reach out to Gord or Stephanie at BlueTree Mortgages West. 

*All calculations done at 5.04%