// strategy

House hacking in London, Ontario

Last reviewed October 30, 2026

House hacking means buying a home, living in part of it, and renting out the rest. A tenant's rent helps cover your mortgage. It's the most accessible way into income property, because you can often buy with owner-occupied financing and a smaller down payment.

Common house-hack setups in London

1. A house with a legal basement unit

You live upstairs and rent the basement apartment, or vice versa. London has many older homes where a separate-entrance basement unit is feasible. The key word is legal. See additional residential units.

2. A duplex or triplex

You live in one unit of a purpose-built or converted multi-unit building and rent the others. These are found in older central neighbourhoods and along some main streets. See duplexes & triplexes.

3. Renting rooms

You buy a house and rent spare bedrooms to roommates, often students or young professionals. It's the simplest setup and requires no separate unit, but you share your living space, and the City's rules on rental licensing and the number of bedrooms still matter.

4. A garden suite or coach house

A separate unit in an accessory building on the lot. London permits additional residential units in accessory buildings on many lots, subject to zoning and servicing. These are more expensive to build, but they offer more privacy for both owner and tenant.

Why it works

• Owner-occupied financing. Because you live in the property, you may qualify for owner-occupied mortgage terms. For insured mortgages on owner-occupied 1–2 unit properties, the minimum down payment follows the standard rules (from 5%). Owner-occupied 3–4 unit properties have higher minimums. Ask your lender.
• Rental income can help you qualify. Many lenders count a portion of the expected rent from the other unit toward your income.
• You manage it on-site. Problems get noticed early, and you can maintain the property properly.
• It builds equity faster. Someone else helps pay down your mortgage.

The trade-offs

• Privacy: you live next to your tenant. Sound transfer, shared laundry and shared yards all matter.
• Being a landlord: you're bound by the Residential Tenancies Act, with some differences when you share a kitchen or bathroom with the occupant. See landlord basics.
• Compliance costs: making a unit legal (fire separation, egress windows, smoke and CO alarms, permits) can be expensive in older homes.
• Resale: a legal, well-finished second unit can add value. An illegal one can be a liability.

What to look for when buying

• Separate entrance (or the ability to add one)
• Ceiling height in the basement, and windows large enough for egress
• Separate heating/cooling controls, or the ability to add them
• Electrical panel capacity, and separately metered utilities if possible
• Sound separation between floors
• Parking for both households (London restricts overnight on-street parking in many areas)
• Proximity to transit, campuses or hospitals, which affects your tenant pool

Underwriting a house hack

Treat it like an investment, even though you live there. Estimate the rent conservatively, then subtract a vacancy allowance, the extra insurance cost, maintenance and the extra utilities you'll pay if they're not separately metered. Compare your net housing cost with what you'd pay to rent or own an equivalent home without a unit. The numbers page has a template.