Multi Unit Buildings

Whether you are looking for extra income to help you with your mortgage or you are thinking of buying property with friends or family, a multi unit building may be the way to go. The most popular (and sometimes most profitable) way to do this is for two parties to purchase a two unit building together. Generally it is two friends who come together to become business partners; owning property together is a business relationship. The goal in this scenario is to convert the units into condominiums. The order of events is:

1. Purchase a two unit building as Tenancy In Commons where both units will be owner occupied
2. Fulfill the one year owner occupancy requirement to start the condo conversion process
3. File papers with the city to convert
4. Have building, plumbing, and electrical inspections and complete all suggested work
5. Have a survey done of the property
6. Prove occupancy

Once all of the work is done and has been signed off on by the city, you become the proud owner of a condominium. This process can take anywhere from 12 to 24 months. Converting tenancy in commons (TICs) into condominiums is desirable as it will raise the property value 10-15%. Also instead of owning a percent interest in the entire building with the other party, you become the sole owner of your unit.

If the building is three to six units, the occupancy requirement you must fulfill in order to convert is three years and then you must enter the condo conversion lottery. Winning the lottery can take another five or six years, so you may not be able to convert for eight or nine years after purchase. In this scenario, you cannot buy with the intent to convert. If it happens, it is a bonus for you.

There are some restrictions on converting based on the eviction history of the building, and these laws change periodically so be sure to check the eviction history of the building and the current laws.