How much should I put down?

[Tanveer Mostafa]

I am looking at purchasing a condo in downtown Toronto.

The purchase price is $495K with condo fees of $340.00 and I will be looking to do a short term rental on it and potentially switch back to long term once things get back to normal (legal in that building). I am expecting to roughly break-even using short term rentals but if I need to carry some cost I will.

My question is, should I put down as little as possible (5%) and use the rest of my available cash to invest in a second property sooner OR should I put more down (ie.15%) so that I can pay off the mortgage and get to 20% equity quicker in order to refinance quicker in a few years. The less I put down, the longer I would have to wait to refinance.

Any advice is appreciated. Thank you!

[Tanveer Mostafa]

Originally posted by @Doug Pintarch:

Tanveer we have 2 condos that we strictly do short term rentals in...and we make much more than we ever would putting a long term tenant in there.   If you are "Roughly breaking even" with a short term rental plan, how are you going to positive cash flow with a cheaper long term renter in there?    Have you done your math right?!

Thanks Doug. When I say "breaking even" I am being super conservative on that end just so that it's built into my risk tolerance. In reality I do see positive cashflow coming from short-term.