Considering the rising cost of home ownership in Canada, many people are looking towards income properties. The cheapest way to acquire an income property is to actually live in the property that you will also be renting out. Duplexes are a great income property since the home is clearly divided into two areas. However, homeowners are becoming creative and now it is not uncommon to see a self-contained apartment within the single unit. If you are tight on money, but want to own your own home this is a great way to make your dream come true. Essentially you will be a landlord in your own home and before you go this route there are a few things that you should be aware of.

There are certain financial implications that come along with income properties. Since you will be acquiring income each month from your property you will be required to declare this income on your tax return. The mortgage interest, utility costs and the portion you spend on yearly home maintenance can all be written off. Other expenses that you can write off include: insurance premiums, property tax, and accounting and office expenses. Your accountant will best advise you of all the tax benefits and liabilities that come along with income properties. Aside from the financial implications, as a landlord you need to know what your rights and responsibilities are.

You can get a copy of the Rental Act from the municipal bylaw office. It is advisable that you read it thoroughly as all the information is contained there regarding the rules and regulations for income suits. As a landlord, you will need to decide whether to include the heat, water, and power expenses in your monthly rent. You need to decide whether your unit will come furnished, will you allow pets, and will the tenant have a garage space, and if the tenant will have access to the backyard of the home. Lastly you need to think about the monthly rent you will charge. The average monthly rent for income properties in Toronto are:

Bachelor pad: $896
1 Bedroom: $1,067
2 Bedroom: $1,251
3+ Bedroom: $1,458

Lastly in order to be a good landlord you will need to have all the paperwork organized. This will not only benefit you but the tenant as well, if certain discrepancies should arise you always have a paper trail to fall back on.