The Power of Leverage in Real Estate Investing

Josh Perez • July 11, 2024

Leverage is one of the most attractive aspects of real estate investing. For every dollar you have to invest, you can acquire an asset worth 5, 10, or even 20 dollars. This significantly increases your overall rate of return and accelerates your wealth-building potential.

"Leverage is one of, if not the most attractive part, about real estate investing. For every dollar you have to invest, you can acquire an asset that's worth 5, 10, or $20, significantly increasing your overall rate of return and the ability to accelerate building wealth."

Traditional Residential Financing

With traditional residential financing, your personal income, credit, and monthly obligations play a significant role in determining how much you can borrow. Typically, you may qualify to borrow up to 80% of the purchase price or appraised value of a rental property. This means that for every dollar you put down, you could potentially control an asset worth five times that amount.


Commercial Financing

Commercial financing, on the other hand, focuses on the net operating income (NOI) or profitability of the property. Depending on these factors, you might qualify to borrow up to 75% or, if you're fortunate, 80% of the property's purchase or appraised value. This type of financing allows investors to leverage the property's income-generating potential rather than their personal financial situation.


CMHC Multi-Unit Financing

Canada Mortgage and Housing Corporation (CMHC) offers even more attractive options for multi-unit financing. CMHC has designed two programs that allow investors to leverage up to 85% or even 95% of the purchase or appraised value of a multi-unit building. These programs provide significant advantages:

  • Larger or Higher Yielding Projects: With higher leverage, investors can enter larger or more profitable projects than they might otherwise afford.
  • Reduced Down Payment Requirements: By requiring less capital upfront, investors can maintain liquidity to explore additional value-add properties.
  • Capital for Improvements: Investors can use freed-up capital to make improvements that increase income or reduce expenses.
  • Increased Refinance Opportunities: Improved properties can be refinanced to access more capital, which can be reinvested to acquire additional assets and further accelerate wealth-building plans.


Leverage is a powerful tool in real estate investing, enabling you to amplify your returns and grow your portfolio more rapidly. With various financing options available, from traditional residential loans to commercial and CMHC multi-unit programs, investors have multiple avenues to explore and maximize their investments.


To learn more about building wealth with multi-family real estate investing, schedule a call with us today. Together, we can create a strategy that leverages your investment to its fullest potential and helps you achieve your financial goals.

Josh Perez
GET STARTED

Deposit vs. Down Payment: Key Differences for Homebuyers

By Josh Perez • February 18, 2026
When you’re buying a home, two terms often cause confusion: deposit and down payment . While they’re related, they serve very different purposes in the homebuying process. Here’s what you need to know. What Is a Deposit? A deposit is the money you provide when you make an offer on a property. Think of it as a show of good faith that proves you’re serious about purchasing. How it works : Typically, you provide a certified cheque or bank draft that your real estate brokerage holds in trust. If your offer is accepted, the deposit remains in trust until the deal moves forward. If negotiations fall through, the deposit is refunded. Connection to your down payment : Once the sale is finalized, your deposit becomes part of your total down payment. Why it matters : The amount is negotiable, but a larger deposit can make your offer more attractive in a competitive market. Keep in mind, however, that if you back out after conditions are removed, you risk losing your deposit. What Is a Down Payment? Your down payment is the amount you contribute toward the purchase price of your home when securing a mortgage. Minimum requirement : In Canada, the minimum down payment is 5% of the home’s purchase price. Anything less than 20% requires mortgage default insurance. Sources : Down payments can come from your savings, the sale of another property, RRSP withdrawals (through the Home Buyers’ Plan), a gift from family, or even borrowed funds. Example: How They Work Together Imagine you’re buying a $400,000 home with a 10% down payment ($40,000). When you make your offer, you provide a $10,000 deposit . Once conditions are met, that deposit is transferred to your lawyer’s trust account. At closing, you add the remaining $30,000 to complete your full down payment. The lender provides the rest—$360,000—through your mortgage. The Bottom Line Your deposit shows commitment and secures your offer, while your down payment is what makes the mortgage possible. Together, they work hand in hand to get you into your new home. 📞 If you’d like clarity on deposits, down payments, or any other part of the mortgage process, let’s connect. I’d be happy to walk you through it step by step.
Cozy armchair next to a small wooden table with a mug and an open book. Sunlight streams through a window.

Is a 5% Down Payment a Mistake? Here’s the Unpopular Truth.

By Josh Perez • February 15, 2026
Discover why a 5% down payment isn’t always irresponsible. Learn when a low down payment is a smart financial move for Ontario homebuyers and when it’s a risk.