Introduction: When Time is On Your Side
Imagine buying a 12-unit apartment building in Calgary great location, solid tenants, and good upside, but there’s one issue:
The numbers are tight.
You’ve got a lender lined up. But at a 25-year amortization, the monthly mortgage payments are chewing up most of your NOI. Your cash flow? Barely breathing.
Then your broker suggests something wild: “What if we stretched the amortization to 50 years through CMHC MLI Select?”
At first, it sounds too long.
But then you see the numbers.
Let’s dive into why 50-year amortizations are becoming a smart tool for Canadian investors, especially in cities like Calgary, where cap rates are still healthy, and cash flow can be maximized with the right mortgage structure.
📉 The Monthly Payment Difference: 25 vs 50 Years
Let’s break it down using a real-world example:
- Purchase Price: $2,400,000
- Loan Amount: $2,000,000 (insured by CMHC)
- Interest Rate: 4.75%
- Monthly Gross Rent: $19,500
- Operating Expenses: $8,000
- Net Operating Income (NOI): $11,500
Now, let’s compare amortization periods:
| Amortization | Monthly Mortgage | Monthly Cash Flow (NOI – Mortgage) |
| 25 years | $11,386 | $114 |
| 50 years | $8,951 | $2,549 |
That’s a difference of $2,400+ per month in cash flow.
That extra buffer could cover:
- Repairs
- Professional property management (hi 👋 Green Casa!)
- Vacancy reserves
- Or even additional deals
This is the power of time in your corner.
🧮 Why 50-Year Amortizations Are Possible (and Who Qualifies)
CMHC’s MLI Select program makes it possible to extend your amortization beyond the traditional 25 or 30 years up to 50 years, as long as your property meets their scoring system in at least one of three categories:
- Energy Efficiency (e.g., new windows, high-efficiency heating, or Net-Zero features)
- Affordability (a % of units rented at below-market rates)
- Accessibility (barrier-free units, elevators, or accessible design features)
Calgary’s surge in new multi-family developments and purpose-built rentals means many buildings qualify, especially when you build or buy with these features in mind.
⚖️ The Trade-Offs: What You Gain and What You Lose
So why isn’t every investor doing this?
Here’s the fine print:
✅ Pros:
- Stronger cash flow
- Easier debt coverage ratio (DCR) compliance
- Better flexibility during vacancies or market fluctuations
- Potential for reinvestment through cash-out refis
❌ Cons:
- You pay more interest over the long term
- You remain in debt longer
- Smaller annual principal paydown
- May limit refinancing options in the future
So it comes down to strategy, are you focused on cash flow today, or equity tomorrow?
💬 Final Thoughts: Stretch Smart, Not Just Long
A 50-year mortgage isn’t a magic wand. But in the right scenario, especially for cash flow-focused investors, it could be the difference between a deal that barely works and one that builds long-term wealth.
If you’re looking at multi-family investments in Calgary or Edmonton, and the numbers feel tight, it’s time to revisit how your debt is structured. You might be sitting on a great deal, and just need the right mortgage to make it shine.
At Green Casa, we work closely with investors who are navigating these decisions. And once you’ve secured the deal, we make sure your property is managed professionally and profitably.
