Multiplex Mortgage Rules in Canada: The Third Unit Costs Exactly $25,000 More Down

Toronto, 28 October 2026 — If you are shopping for a two-unit building because you heard you only need 5% down, the arithmetic is about to disappoint you, and then it is going to change your mind. On a $900,000 owner-occupied property the minimum down payment on a duplex is $65,000, not $45,000 — 7.22%, not 5%. Step up to a triplex and CMHC requires a flat 10%, or $90,000. That is $25,000 more. The useful part: on a multiplex mortgage at today's best insured five-year fixed rate of 4.34%, the third unit's rent recovers that $25,000 in about 23 months, and it drops the income you have to prove from $167,163 to $132,708 a year. The fourth unit recovers it in 13 months.

The Bank of Canada's policy rate is 2.25%, unchanged since the cut of 29 October 2025, with prime at 4.45%. A rate announcement and Monetary Policy Report land at 9:45 am ET today, 28 October, and the next decision after that is 9 December. We covered what the market was pricing into today's meeting in our rate hike odds piece; market expectations move and can change without notice.

Multiplex mortgage down payments: the $25,000 step is a constant

CMHC's homeowner rules behind every insured multiplex mortgage treat one and two units identically and three and four units identically. One or two units can go to 95% loan-to-value, with minimum equity of 5% on the first $500,000 of lending value plus 10% on everything above it. Three or four units cap out at 90% LTV — a flat 10%, no sliding scale.

Because the two-unit formula is also 10% above $500,000, the gap between a duplex and a triplex is not five percentage points. It is $25,000, and it is $25,000 at every price point above half a million dollars.

Purchase price	1–2 units (min. down)	Effective %	3–4 units (min. down)	Gap
$500,000	$25,000	5.00%	$50,000	$25,000
$700,000	$45,000	6.43%	$70,000	$25,000
$900,000	$65,000	7.22%	$90,000	$25,000
$1,100,000	$85,000	7.73%	$110,000	$25,000
$1,300,000	$105,000	8.08%	$130,000	$25,000
$1,500,000	$125,000	8.33%	$150,000	$25,000

Two things fall out of that table. The "5% down" headline on a two-unit building is only true at exactly $500,000 — by $1.3 million the real requirement is 8.08%. And the decision to add units is a fixed $25,000 question, not a proportional one, which means it gets easier to justify the more expensive the building is.

What a multiplex mortgage costs on a $900,000 building

Here is the same multiplex mortgage priced three ways, at minimum down, on a 25-year amortization at 4.34% insured five-year fixed money. Assume $5,400 a year in property tax, $150 a month in heat, and $1,800 a month in market rent per rentable unit. Those four inputs are stated assumptions, not quotes.

Measure	Duplex (2 units)	Triplex (3 units)	Fourplex (4 units)
Down payment	$65,000 (7.22%)	$90,000 (10.00%)	$90,000 (10.00%)
Loan before premium	$835,000	$810,000	$810,000
Loan-to-value	92.78%	90.00%	90.00%
CMHC premium rate	4.00%	3.10%	3.10%
Premium in dollars	$33,400	$25,110	$25,110
Total borrowed	$868,400	$835,110	$835,110
Payment at 4.34%	$4,729.42	$4,548.12	$4,548.12
Qualifying payment at 6.34%	$5,732.78	$5,513.02	$5,513.02
Gross rent collected	$1,800	$3,600	$5,400
Income needed, 39% GDS	$167,163	$132,708	$105,016
Balance after five years	$760,390	$731,241	$731,241

Notice what the premium does. The duplex puts $25,000 less down and lands in the 90.01%–95% insurance band at 4.00%, while the triplex sits exactly at 90% and pays 3.10%. The premium difference is $8,290. So the duplex borrower, having saved $25,000 at closing, ends up owing $33,290 more and paying $181.30 a month more. A smaller down payment on a multiplex mortgage is not a smaller mortgage by the same amount.

The third unit pays for itself in 23 months

Run the two multiplex mortgage effects together on a triplex against a duplex: $181.30 a month of lower payment plus $900 a month of additional rent credit, assuming a lender that offsets 50% of gross rent. That is $1,081.30 a month in the triplex's favour. The extra $25,000 of down payment is back in your pocket in 23 months.

On a fourplex the swing is $1,981.30 a month and the payback is 13 months. The income test moves even further: $105,016 of proven income against the duplex's $167,163, a difference of $62,147 a year of gross income you no longer have to document. For a self-employed buyer whose paper income binds, that is the whole ballgame — our guide to qualifying while self-employed covers how lenders build that income figure.

Rent is also the input that grows. Statistics Canada put rent inflation at 2.8% year over year in the September CPI release of 19 October, with headline inflation at 3.1%. Hold $3,600 of gross rent at 2.8% and you collect $18,836 more over five years than you do in year one. Your payment, on fixed money, does not move at all.

On a multiplex mortgage, rental offset is worth 2.6 times add-to-income

This is the part multiplex mortgage borrowers get told backwards. Lenders use one of two methods for rent on the property you are buying, and the method matters more than the percentage.

Rental offset subtracts a share of gross rent from your housing costs — the top of the debt-service ratio. Add-to-income adds a share of gross rent to your income — the bottom. Because GDS is capped at 39%, a dollar taken off the top is worth $1 ÷ 0.39, or $2.56, of income added at the bottom. At the same percentage, offset wins by a factor of 2.6.

Method on $3,600 gross rent	Employment income needed
80% rental offset	$99,477
50% rental offset	$132,708
80% add-to-income	$153,533
50% add-to-income	$166,493

An 80% offset and an 80% add-back are a $54,056 difference in the income you must prove on the same building with the same rent. Published lender ranges run roughly 50% to 70% of gross rent on insured files and 50% to 100% elsewhere, with big banks clustered at 50% and monoline lenders nearer 80% — those ranges are secondary-source figures, not quotes, and they change. Ask two questions in writing before you choose a lender for a multiplex mortgage: what percentage, and offset or add-to-income. Some lenders also floor the offset at zero rather than letting surplus rent reduce other debts, which quietly caps the benefit on a fourplex.

The multiplex mortgage amortization rule most buyers fail

Insured multiplex mortgage amortization is capped at 25 years. It extends to 30 only when LTV is above 80% and you are a first-time buyer or the property is newly built. A move-up buyer purchasing a resale triplex meets neither test and is stuck at 25 years.

On the $835,110 triplex loan, the difference is real in both directions. Thirty years drops the payment from $4,548.12 to $4,133.34, a saving of $414.77 a month, and cuts the income you must prove by $11,287 a year. It also leaves $27,710 more owing at the end of five years. That is the same trade we priced in our piece on stretching amortization at renewal: a lower payment bought with a larger balance.

Two multiplex mortgage cliffs: $1.5 million and five units

An insured multiplex mortgage requires a lending value under $1.5 million when LTV is above 80%. There is no taper. A $1,499,000 fourplex needs $149,900 down. At $1,500,000 the insured door closes and you need 20%, or $300,000. One thousand dollars of price costs $150,100 of cash.

The second cliff is the fifth unit. One to four units is homeowner lending, underwritten on your personal income and the minimum qualifying rate. Five units and up moves to CMHC multi-unit insurance, where underwriting runs off the property's net operating income and a debt service coverage ratio rather than your pay stubs, and amortizations run far longer. That is a different product with different brokers and a different timeline, not a bigger version of a multiplex mortgage.

Also worth knowing: CMHC homeowner financing is limited to two properties per borrower at any time, the property must be owner-occupied by you or a close relation, minimum credit score is 600 for at least one borrower, and the stress test applies at the greater of your contract rate plus 2% or 5.25% — 6.34% at a 4.34% contract rate. See our stress test explainer for when that rate binds and when it does not. If no insured lender will take the file, the alternative is a B lender at 20% or more down, which changes the economics substantially.

What to do before you make an offer

• Count the legal units, not the doors, before you apply for a multiplex mortgage. Retrofit units without permits or occupancy approval are not units to an insured lender, and an unregistered third unit turns your triplex into a duplex at underwriting.
• Get a market-rent letter from the appraiser for every unit, including any you intend to occupy later. Most lenders will recognise suite income on a purchase before a tenant is signed.
• Ask each lender, in writing, what rent percentage it uses and whether it offsets or adds to income. A 2.6-times difference is worth a phone call.
• Check the lending value against $1.5 million before you write the price, not after.
• Confirm whether you qualify for 30-year amortization. If you are not a first-time buyer and the building is resale, budget the 25-year payment.
• Price the premium at the band you will actually land in. Crossing from 90% to 90.01% LTV moves the rate from 3.10% to 4.00%, which is $7,290 on an $810,000 loan.
• Add provincial sales tax on the premium if you are buying in Ontario, Quebec or Saskatchewan. It cannot be added to the loan and has to be paid at closing.
• Budget for vacancy, repairs and the fact that you are now a landlord in your own building. None of the figures above include a vacancy allowance.

Common questions

Can I get a multiplex mortgage with 5% down?

Only on a one or two unit property, and only at a purchase price of $500,000 or less. Above that the sliding scale applies: 5% on the first $500,000 and 10% on the balance, which is 7.22% at $900,000. Three and four unit buildings require a flat 10% with no 5% option, and you must occupy one of the units.

Does rental income from the other units count toward my multiplex mortgage?

Yes, but how much depends entirely on the lender. Published ranges run from 50% to 100% of gross rent, and the method matters more than the percentage — a 50% offset beats an 80% add-to-income on the same file. Lenders generally want an appraiser's market-rent letter or a signed lease.

What happens to my multiplex mortgage if rates move at today's announcement?

Nothing immediate on a fixed rate you have already closed. A variable rate moves with prime, currently 4.45%. If you are still shopping, a rate hold protects the quoted fixed rate for a set window while you complete the purchase. The five-year Government of Canada bond yield, which drives fixed pricing, closed at 3.58% on 26 October, up from 3.50% on 22 October. Where fixed rates go from here is a market expectation that can change.

Every rate quoted here is a lowest-advertised aggregator figure as at 28 October 2026 and not an offer; what you qualify for depends on your file, your credit and the property. RateShop compares lenders rather than lending, and no rate, approval or outcome described above is guaranteed.