Cmhc for retail+rental building

2 Replies

First-timer buyer. Owner-occupied.

From what I understand in order to buy a 3-4 unit building with less than 20% down I must have CMHC mortgage insurance. I remember reading that one of the units could be commercial space as long as it is less than 50% of the building, but I cannot find any info about this on the cmhc site.

Am I remembering this correctly? Can I get a conventional mortgage with 10% down on a 3-unit building where one of the units is a commercial space accounting for half of the square footage?

Thanks

@Colin Davis

Hey Colin, so ya CMHC allows 5% down on 2 units or less for owner occupied properties, and 10% down for 3-4 unit owner occupied.

I’ve never heard of any scenario that involved bank financing where you can put less than 20% down on a mixed use building. Definitely wouldn’t bank on that at all. CMHC insures on the commercial side, a lot of times if you read their policies it sounds appealing but in practice doesn’t actually result that way.

CMHC May offer 80% LTV on a residential building, but then when they qualify it, they value the building at a way lower price point than purchase and only lend 80% on that price point vs. The purchased value.

The point being, be skeptics of any guidelines you read in the lending space because in practice a lot of these things don’t happen.

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