Why Investors Are Looking at Multi-Unit Properties
In today’s GTA market, duplexes, triplexes, and small apartment buildings are gaining traction among investors. With rental demand and affordability challenges pushing more households toward renting, multi-unit properties offer both steady cash flow and long-term appreciation. But as many of our clients have discovered, success in this segment requires a clear-eyed view of the pros, cons, and management realities.
The Upside: Pros of Multi-Unit Ownership
• Diversified income: Multiple units mean multiple rent streams. Even if one unit is vacant, others can help cover expenses.
• Economies of scale: Managing three units under one roof is often more efficient than managing three separate condos. Shared systems (roof, furnace, utilities) reduce per-unit costs.
• Value-add potential: Investors can increase returns through renovations and improved tenant services.
• Long-term appreciation: Multi-unit properties in transit-friendly GTA neighbourhoods tend to hold value and attract strong rental demand.
Clients who’ve purchased duplexes or triplexes often highlight the stability of having “built-in diversification.” One investor client noted that while a single condo vacancy meant zero income, their triplex allowed them to maintain cash flow even during tenant turnover.
The Challenges: Cons to Consider
• Higher upfront costs: Multi-unit properties typically require larger down payments and more complex financing.
• Tenant management: More tenants mean more personalities, more maintenance requests, and more potential disputes.
• Regulatory complexity: Landlord-tenant laws in Ontario are strict. Investors must be prepared to navigate rent control, eviction processes, and compliance with building codes.
• Liquidity: Duplexes and triplexes don’t sell as quickly as single-family homes or condos. Investors should be ready for longer holding periods.
One client who purchased a small apartment building shared that while the returns were strong, the learning curve around tenant rights and maintenance obligations was steeper than expected.
Management Realities: Lessons Learned
Owning a multi-unit property is not a passive investment. Here are some realities our clients have encountered:
• Professional property management pays off: Many investors find that hiring a property manager is worth the cost. It reduces stress and ensures compliance with regulations.
• Budget for maintenance: Shared systems like boilers or roofs can be expensive to repair. Setting aside a healthy reserve fund is essential.
• Tenant screening is critical: A single problematic tenant can affect the entire building’s atmosphere. Careful screening protects both income and community.
• Plan for turnover: Even in high-demand areas, tenant turnover happens. Investors should factor in vacancy periods when calculating returns.
Case Insights from the Field
• Duplex buyers often appreciate the balance of manageable size and reliable income. Some investors live in one unit and rent out the other, offsetting mortgage costs while building equity.
• Triplex investors highlight the efficiency of managing multiple units under one roof. They often see stronger cash flow but must be prepared for more complex tenant dynamics.
• Small apartment building owners enjoy scale and long-term appreciation but face higher management demands. These properties often require professional oversight to maximize returns.
The Bottom Line
Multi-unit properties in the GTA can be powerful wealth-building tools, but they demand preparation and active management. The pros — diversified income, economies of scale, and long-term value — are compelling. The cons — higher costs, regulatory complexity, and tenant management — are real but manageable with the right strategy.
For investors willing to embrace the realities of ownership, duplexes, triplexes, and small apartment buildings offer a pathway to stable returns and lasting growth.