Houses with income suites (often called secondary units or in-law suites) that can be rented are a big draw for buyers these days. With prices for detached homes still relatively high, this feature offers buyers the opportunity to pay their mortgage with the help of rental income.
Before purchasing, verify that the secondary unit is legal and registered with the municipality. Illegal units can result in fines, required renovations, or orders to remove the unit.
Understand the rental income potential realistically. Research comparable rents in the area and factor in vacancy periods, maintenance costs, and your responsibilities as a landlord.
Consider the impact on your mortgage qualification. Some lenders will allow you to include a portion of the rental income in your application, which can help you qualify for a larger mortgage.
Think about your lifestyle. Being a landlord comes with responsibilities and potential challenges, including tenant relations, maintenance requests, and the possibility of problem tenants.
Ensure adequate insurance coverage. You'll need landlord insurance in addition to your regular homeowner's policy to protect against liability and rental-specific risks.