Purchasing a duplex or a triplex may not be the miracle solution if you want to make a fortune in real estate, but it enables you to buy a small building, suited to your needs, with the added bonus of rental income. Moreover, the owner acquires a yard, extra space, additional rooms, and at times a parking space or garage.
For a first home, a plex may not suit everyone. You have to come up with a larger down payment, live alongside renters, be able to supervise renovations and juggle income and expenses. Not everyone wants to take that on. But a plex does have a number of advantages that could be attractive or even turn a profit years down the line.
Ideal compromise for family life
Purchasing a plex is often an ideal way for a family in the market for first home to acquire a spacious ground floor apartment, with a street-level entrance, yard, storage space and a basement.
Acquiring a revenue-generating property also helps offset the mortgage payment, through the monthly rental income. The plex provides the perfect alternative to families who can’t afford a single-family home.
Located in popular neighbourhoods, plexes also provide an opportunity to purchase with a family member or friend, share the benefits of the building, live closer to parents or provide accommodation to grown children.
Row or semi-detached
Typical of Montréal’s central neighbourhoods, duplexes and triplexes, in rows, have two or three floors. Often faced with red brick, most have an exterior wrought iron staircase, dating from the early twentieth century.
Many of the less central areas, such as LaSalle, Saint-Léonard or Ahuntsic, are home to newer duplexes, both semi-detached and in rows. They were built for families between 1950 and 1970. They boast more spacious apartments, most often with a back yard and frequently have three bedrooms and a basement garage.
What type of plex?
The down payment is, above all, proportional to the asking price. Most people want smaller buildings, such as duplexes or triplexes, so there are fewer buyers for quadraplexes or even larger buildings. It’s a great opportunity for those who can afford it. Bear in mind that the minimum down payment for a duplex is 5%, but that increases to 10% for a triplex.
Ground-floor apartments in triplexes and quadraplexes are often larger than the average apartment. That’s why they’re so popular, particular with young families with active kids running around.
Montréal plexes are often older buildings. So you’d be well advised to verify their condition at the time of purchase. A property inspection is therefore essential.
In most cases, people who purchase a duplex or triplex choose to live in one of the units. In addition to rental income, they benefit from tax deductions for money spent on home improvements, to help pay their mortgage. They may also qualify for the Home Buyer’s Plan. If it’s been over five years since they owned a principal residence, they can use money that’s accumulated in their RRSP as a down payment.
Here are some resources for property owners :