Royal York Property Management’s President on Canada’s New Rental Loan Program: “A Step Forward with the Right Support”

By: Maria Williams

Canada’s government has launched new program to encourage homeowners to turn unused spaces, like basements and garages, into rental units.

Starting January 15, 2025, the Government of Canada will offer high-leverage insured mortgages, letting homeowners borrow up to 90% of their property’s value to develop accessory units.

This initiative tries to reduce rental shortages and help Canadians unlock their property’s ﬁnancial potential.

The new program could help middle-class homeowners create extra income while addressing Canada’s rental housing challenges.

This way, homeowners can create independent rental units from underused spaces to earn extra income and help ease the housing shortage by providing affordable options for local tenants.

What the Program Means for Canadian Homeowners

Nathan Levinson notes that while the program offers exciting opportunities, homeowners need to be ready for the responsibilities of being landlords.

“Many Canadians think renting out part of their property is a great way to earn some extra income. But they often don’t realize the challenges that come with it, like ﬁnding reliable tenants, enforcing leases, or managing the collection of the rent. At Royal York Property Management, we deal with this every day, and we’re here to help homeowners address these issues and make sure their rental investments are successful.”

Levinson points out that while the new program gives homeowners a chance to create rental units, they should consider several challenges:

Financial Risks: With loans covering up to 90% of the property’s value, homeowners need to make sure their rental income can cover expenses, especially during vacancies.
Market Volatility: The rental market can be unpredictable. Even experienced investors struggle with ﬁlling units and maintaining financial growth.

Regulatory Requirements: Units need to comply with municipal zoning laws and cannot be used for short-term rentals, which may limit the ﬂexibility homeowners hope for.

“Without professional support, some homeowners may feel overwhelmed. Tenant screening, lease management, and legal compliance all require experience and attention to detail,” Levinson explains.

“This is where partnering with a property management company can make a real difference. We at Royal York offer end-to-end services—from tenant placement to rent collection.”

Levinson adds: “We understand that many homeowners entering the rental market may have little to no experience managing properties. That’s why we provide a safety net, helping Canadians go through the complexities of being a landlord.”

A Balanced Approach to Canada’s Housing Crisis

While this new loan program offers hope for homeowners looking to generate income and address the housing shortage, Levinson stresses that it is not a quick ﬁx.

“Accessory units can help ease the rental shortage, but most rental supply still comes

from larger multi-family developments,” he explains. “This program is a step in the right direction, but homeowners should approach it with realistic expectations and the right support.”

As Canada looks for innovative solutions to the housing challenges, Royal York Property Management is prepared to help homeowners enhance these opportunities, making sure their rental ventures are gainful and sustainable.

Edona Shala

Disclaimer: This article is for informational purposes only and should not be considered financial advice. Homeowners should consult with a financial advisor to understand the risks associated with high-leverage loans and rental property investments.

Published by: Martin De Juan