Put condo on rent; buy a house in GTA
- We live in a condo and plan to buy a bigger place (house, semi or town) in Greater Toronto Area.
- Condo is paid off and we are thinking of putting it on rent.
- Down payment (20% or more) for the house will need to be a refinance from the condo.
1. Should we sell the condo or put it on rent? It's in a nice area and should sell quickly. Same for rent - should be comparatively easy to put it on rent.
2. Is it worth the hassle to rent it out?
3. Advantage of selling the condo vs putting on rent?
Questions below are on the scenario if we were to rent out the condo:
4. Are there any taxation benefits? Even though we are taking out funds from our principal residence at the moment (condo); we will buying a property (house) that will be our principal residence and condo will be investment property. Does this allow the mortgage interest on the condo or the house to be interest free?
5. How is the rent taxed? For eg, if we get $2500 and say maintenance fees and property tax are around a $1000...how much is considered additional income that is taxable? Would it be $1500 per month?
6. For folks who have been in this situation; how have you set it up to keep the 2 properties/transactions separate to have proper record keeping (rent income, maintenance and property taxes completely separate)? Separate bank accounts?
7. Any real estate lawyers that you had a great experience with and would recommend?
Anyone in this situation? How has it been working out for you so far?