Three Top Rental Property Investment Tips for Canadians

Nelda Schulte
5 min readApr 12, 2022

Despite COVID-19’s negative impact on our economy, one industry that has remained strong is Canadian real estate. In 2022 the demand for housing reached unprecedented highs, making real estate one of the safest and most profitable investments.

For investors wondering how to enter the rental property investment market, here are three areas to consider: qualifying for a mortgage, investment/investor criteria, and investment property types.

Rental property investment mortgage qualifications

Although there are many factors that influence a lender's decision to grant a mortgage, two of the most important are your debt to income ratio and your FICO score.

Debt to income ratio

Mortgage lenders consider several factors before agreeing to grant loans, and the debt-to-income ratio plays a role. Simply put, it’s the amount of money you owe versus the amount of money you earn. If you’re in a high-income job and have very few debts, you’re in an excellent position to be granted a loan at a reasonable interest rate.

Credit Scores in Canada provide a numeric range called a FICO score. FICO scores range from 300 (low) to 900 (excellent). Lenders want to see evidence that you have a history of paying your bills on time and access your credit score for your credit history. Although each lender has specific criteria, typically, anything between 600–650 is considered a good credit score, which means you have a history of regular payments and a decent debt to income ratio.

Things to consider before you buy a rental property investment

You’ve no doubt heard the expression “begin with the end in mind” — the same concept applies to real estate goals

What’s your exit strategy?

What do you want your real estate investment to do for you? I once attended a motivational seminar where the speaker said that most people fail to realize their goals because they set vague goals. Set specific, realistic goals within a reasonable time frame, then work backward. Rather than saying — I want to own millions of dollars of investments, reframe it to I…

Nelda Schulte

Nelda Schulte is a freelance writer based in Calgary, Alberta, Canada who specializes in real estate.