Posted by: Karim Ali
Coffee with Karim
Should I rent out my property, or should I sell it?
There is no universal right answer. The decision depends on your cash flow, equity, borrowing power, time horizon, risk tolerance, and whether you plan to return to the property in the future. What works well for one person can be a poor decision for another.
This is a 6-7 minute read.
What the Ottawa Rental Market Looks Like (2026)
Before making the decision, it helps to understand the numbers.
Typical rents in Ottawa (as of spring 2026):
- 1-bed condo: about $1,750–$2,150 (≈ $2,000 median)
- 2-bed condo: about $2,200–$2,600 (≈ $2,400 median)
- Townhome: about $2,500–$2,800 (≈ $2,650 median)
- Detached home: about $3,000–$3,300 (≈ $3,100 median)
Approximate monthly carrying costs if you recently purchased it (20% down, ~4% interest, 25-year amortization):
- $500,000 property → ~$2,500/month
- $650,000 property → ~$3,200/month
- $800,000 property → ~$4,000/month
Most properties purchased recently will be cash-flow negative if rented today. Many rental properties only cash flow because the owners bought them years ago, not because the numbers work at today’s prices and interest rates.
Why Some People Still Rent Out Their Property Even If It’s Cash Flow Negative
Even if monthly cash flow is negative, renting can still make sense in some situations.
Common reasons people rent instead of sell:
- They expect and are willing to wait for long-term appreciation
- They want a forced savings plan (tenant helps pay down mortgage)
- They plan to move back into the property later (selling and buying again later is expensive; land transfer tax, commissions, moving costs all amount to about 5-6% of the value of the home)
- They want to slowly build a rental portfolio
When analyzing this, it’s important to assume a modest appreciation rate (for example ~2-3% per year) and factor in all costs: maintenance, vacancy, property management, repairs, and interest costs. If the numbers still make sense over time, renting can be a reasonable long-term strategy. Reach out if you need help putting these together.
When Renting Out Your Property Usually Makes Sense
With the above in mind, renting often makes sense if:
- You plan to return to the property in a few years
- You are thinking long-term (5+ years)
- You can comfortably handle negative cash flow
- The property is easy to rent (condo, townhome, or even a well-located detached home)
- You don’t need all of the equity to buy your next property
- You are comfortable being a landlord (even if you hire a property manager, you’ll have to make some decisions about expenses, tenants, etc.)
A good rule of thumb:
Renting works best when it is part of a long-term plan, not a short-term decision.
When Selling Usually Makes More Sense
Selling often makes more sense if:
- You are moving far away and don’t plan to return
- You need the equity to buy your next home
- The property would be heavily cash-flow negative
- You don’t want the time, responsibility, and risk of being a landlord
- Major repairs are coming
- Keeping the property would significantly reduce your borrowing power, in a way it would hurt your ability to buy a suitable next home
For many move-up buyers, the decision is actually made by the bank, because they need the equity from the sale to qualify for the next home.
The Risks of Being a Landlord
Many people assume renting out a property will be easy. Often it is, indeed, but not always.
Common surprises include:
- More maintenance than expected
- More time involved than expected
- Vacancies between tenants
- Unexpected big ticket repairs
- Tenant issues
- Condo special assessments
- Interest rate increases at renewal
- Property managers still require oversight and decisions from you
A simple way to put it:
Being a landlord is often easy, but prepare for it to be time & money-consuming.
Wear and Tear: Your Property Will Not Feel the Same After Tenants
This is something many homeowners I meet with don’t think about when deciding whether to rent out their property.
Even with very good tenants, most rental properties experience more wear and tear than owner-occupied homes. Over time, you should expect that you may need to do some work to bring the property back to its previous condition before moving back in or before selling.
This might include:
- Painting
- Patching holes
- Replacing or cleaning carpets
- Small repairs to doors, cabinets, or fixtures
- General cosmetic updates to make the property feel and look “turnkey” or like your home again
None of this is catastrophic, but it is a cost that should be expected and planned for.
In short:
If you rent out your property for a few years, you may need to invest some money later to bring it back up to the condition you would want it in before selling, unless you are comfortable accepting a slightly lower sale price.
Property Type Matters More Than People Think
In Ottawa, some properties make much better rentals than others.
- Easiest to rent: condos and townhomes, or anything really well located.
- Harder to rent: detached – especially luxury – homes (higher rent = smaller tenant pool)
- Best long-term rentals: small multi-family properties (e.g. a duplex)
This is an important factor when deciding whether to keep a property as a rental.
The Time Horizon Rule
In general, the longer you hold a property, the more likely renting it out will make sense.
- Holding less than 5 years → selling often makes more sense
- Holding 5+ years → renting becomes more attractive
- Holding 10+ years → renting often makes strong financial sense
It’s never guaranteed, but time greatly reduces risk.
Conclusion
This decision is not just about the math of renting. You need to consider.
- Your time horizon
- Your risk tolerance
- Your cash flow
- Your borrowing power
- Your lifestyle
- Whether you plan to return to the property
TLDR; If you’re trying to decide whether to rent or sell, the best approach is to run the numbers for your specific property and your specific situation. The answer is different for everyone.
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