Real Estate

Buying a new build townhome to use as a rental - total newb.

  • Last Updated:
  • Oct 4th, 2020 10:36 pm
[OP]
Member
Dec 26, 2011
359 posts
107 upvotes
Ottawa

Buying a new build townhome to use as a rental - total newb.

Hi there -
Interested in purchasing a new build townhome (Ottawa area) to use as a rental. Should I disclose it as a rental or not (and apply for HST rebate)?
Any do’s and don’ts I should be aware of?
Any info is greatly appreciated.
Cheers
6 replies
Sr. Member
Dec 8, 2003
958 posts
58 upvotes
Definitely disclose it. First, I believe the builder contracts put all liability on you if you declare it for personal use but actually use it as a rental. Second, on your tax returns it will be evident that this is not your primary residence, and third, assuming normal non pandemic times the HST rebate is simple to apply for (I literally followed along with a YouTube video and had the funds in my account t in 5 weeks).

Bottom line - not worth it to cheat the tax man.
Deal Addict
Feb 25, 2007
2825 posts
608 upvotes
definitely disclose it, once its rented out you can apply for the HST rebate back, if you fill out the form correctly and provide all the information with the package you get the rebate back pretty quickly. Yes, its a pain to put out the $24K upfront, but its the right procedure and that way you will never have to worry about CRA
[OP]
Member
Dec 26, 2011
359 posts
107 upvotes
Ottawa
Thanks. I was given advice not to disclose but I was weary about that.

Other questions I have is:

Any worthwhile builder upgrades? Go cheapest model?
Best way to find renters? Any resources for rental agreements etc?
Sr. Member
Jul 15, 2019
644 posts
493 upvotes
shanjam wrote: Thanks. I was given advice not to disclose but I was weary about that.

Other questions I have is:

Any worthwhile builder upgrades? Go cheapest model?
Best way to find renters? Any resources for rental agreements etc?
If it’s a rental, id go pretty barebones since most upgrades are cheaper afterwards anyways. So if you ever wanted to come in and add something before selling or whatever you can.

If you wanted structural things you should do them
Now.
Deal Addict
Jun 18, 2018
1390 posts
866 upvotes
Toronto
I was once told by the CRA that the rental rebate is similar .. worth checking out if true or not.
Deal Fanatic
Mar 21, 2010
6252 posts
3142 upvotes
Toronto
shanjam wrote: Hi there -
Interested in purchasing a new build townhome (Ottawa area) to use as a rental. Should I disclose it as a rental or not (and apply for HST rebate)?
Any do’s and don’ts I should be aware of?
Any info is greatly appreciated.
Cheers
In my opinion, don't (buy it to rent out at all... obviously do it legally if you choose to do so).

But if you really want to, seriously research what it means to be a landlord in Ontario and look at it like you're about to start running a business, not like you're making a passive investment.

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