The MLI Select Program, offered by the Canada Mortgage and Housing Corporation (CMHC), provides insurance incentives for multi-unit residential properties. It features a point system based on commitments to affordability, energy efficiency, and accessibility. Qualifying buyers can purchase properties with 5 or more units with only a 5% down payment and benefit from a 50-year amortization period.
Your eligibility is based on some key financial factors which are:
An applicant needs to provide confirmation of stable income, optimal credit score, and enough funds for the required down payment and closing costs. Here is a list of typical closing costs that could be incurred: appraisal fee, environmental studies (typically required when you have 7 or more units), lender fees, underwriting fees, legal fees for both your solicitor and the lender’s solicitor are all examples of typical closing costs.
Provide a Personal Net Worth Statement that shows you have at least 25% of the total loan amount in Personal Net Worth. Example, the total loan amount is $1,500,000 so your minimum Personal Net Worth requirement is $375,000.
For a completion takeout finance with CMHC MLI Select (purchasing the property upon completion) you need to show an additional $100,000 in liquidity in addition to your down payment and closings costs. If you are taking the construction route you need to show 10% of the total loan amount in liquidity in addition to the down payment and closing costs.
A borrower’s ability to repay debt obligations which are measured by the total amount of available cash flow relative to the debt payments due annually. The minimum required Debt Service Coverage Ratio (DSCR) is 1.10 or higher.
Along with competence in managing similar properties. Or, if you don’t have an established portfolio, you could draft a letter that details what relevant experience and skills you do possess.
Buildings with five or more rental units designed for long-term residential use.
Examples include detached homes with legal suites (e.g., basement or secondary units) that collectively meet the five-unit minimum requirement.
Buildings with small, individual units, often featuring shared amenities like bathrooms or kitchens.
Properties offering on-site support services for residents, including mental health support, addiction recovery, or transitional housing.
Facilities designed to accommodate seniors, often with specialized care services, recreational spaces, and accessibility features.
Properties designed or retrofitted to include features for individuals with disabilities, such as barrier-free entryways, elevators, and wheelchair-accessible units.
Properties incorporating sustainability measures such as advanced insulation, solar panels, high-efficiency HVAC systems, and LED lighting.
Properties where a portion of the units is offered at below-market rental rates, typically no more than 30% of the local median renter income.
Student housing projects may qualify only under energy efficiency and accessibility criteria.
The MLI Select Program awards points based on borrower commitments to affordability, energy efficiency, and accessibility. Accumulating more points will result in more program incentives. Applicants can focus on one area or combine multiple commitments to increase their score. Most applications in Edmonton (or Alberta) generally focus on affordability.
These benefits make the MLI Select Program a valuable tool for investors and developers looking to promote sustainable, accessible, and affordable housing solutions.
The application process does have its challenges and isn’t as straightforward as a traditional residential mortgage application. However, with the right team and your personal commitment to providing the required documentation, approval is attainable. Application reviews typically take 4 to 6 weeks and often involve additional requests for information. Applications can run smoothly and quicker turnaround is possible when submitted applications are complete and organized.
Required documents may include:
The program incentivizes affordability by offering better terms for projects that provide a high percentage of units with rents below established thresholds (market rents). For example, offering 25% of units at or below 30% of the median rental income can earn up to 100 points.
Eligible measures include high-efficiency HVAC systems, LED lighting, enhanced insulation, and solar panels. These improvements are evaluated based on projected savings and environmental impact.
The eligibility targets for the MLI select program for new construction under Energy Efficiency are as follows:
Both targets need to be met to be eligible under each level. To reach any of these levels, the spec and mechanical upgrades will depend on the type/size of the house or unit. In general, for multi units, we typically see upgrades of insulation in all assemblies, plus upgrades in the mechanics as the GHG emissions are affected most by mechanics. The higher the level, the more significant the upgrades. For Level 3, with multi units, it typically takes some solar to reach 40%.
If you’re ready to start exploring options you can book a phone call meeting to discuss the right steps to start your journey. Below is a list of the first crucial steps you will need to take.
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