Lock-off rental suites included in new condos
August 14, 2020
A 173-unit condo development in Port Moody, B.C., has moved the dial on the rent-to-own concept and income-generating secondary rental suites inside the units.
Port Moody council has given third reading to amend zoning bylaws and the city’s official community plan for the Aultrust Development project at 3000 Henry Street.
The developer plans to make 17 units more affordable through a provision to build six lock-off suites that can be divided to create an income property.
Aultrust will also offer a rent-to-own program on some suites, which, it said, will help get first-time buyers into one of Canada’s most expensive housing markets.
More than 200 people have sought information on the rent-to-own program.
Here is how the program works, according to the company: buyers with a $5,000 deposit can use the market rent they pay—estimated at $2,000 per month—for two years as credit toward the purchase of the home. The developer pays all property tax and insurance during that two-year period. The savings from rent paid and time-value of deposit can add up to 7.2 per cent of the purchase price, the company said.
The purchase price is negotiated and fixed at the beginning of the term. Prospects may be enabled to take on a conventional mortgage with a 20 per cent down payment and won't have to pay the additional 3 per cent mortgage insurance for down payments of less than 10 per cent.
Prospects are not obligated to purchase their homes at the end of the two-year period. They can simply walk away and forfeit their $5,000 deposit and the rent they paid.
“Although it is difficult to imagine why they would do that,” a company spokesman noted.