There’s been a lot of talk lately about the upcoming OSFI mortgage rule changes and what they mean for real estate investors and those buying rental properties. And while some of what’s circulating online sounds dramatic, the real story is much simpler — and much less alarming.
These changes are part of OSFI’s (the Office of the Superintendent of Financial Institutions) Capital Adequacy Requirements (CAR) Guideline for 2026, which outlines how banks must calculate risk and manage loans tied to rental income. The goal is to make sure lenders — and borrowers — aren’t overextended, especially when most of the repayment comes from rent.
Let’s break down what’s actually changing, why, and how both clients and realtors can prepare.
What’s Changing
| Before 2026 | After / Under New Rules | Real-World Impact |
|---|
| Full rental income could be used to qualify for several mortgages | Rental income must now be tied to each specific property — you can’t “double count” it for multiple loans | Investors who used the same rent income for several properties may have slightly lower borrowing power |
| Most or all of a borrower’s qualifying income could come from rent | If over 50% of the qualifying income comes from rent, the loan will likely be treated as “income-producing real estate” | These loans will face more conservative review, sometimes higher rates or more personal income backing |
| Rental income requirements were flexible and sometimes loosely documented | Banks will now need stronger proof of rental income and may discount or stress-test it more heavily | Clients will need clear lease agreements, proof of rent deposits, and reliable supporting income |
Why OSFI Is Doing This
The purpose behind these rules isn’t to make borrowing harder — it’s to ensure that both lenders and borrowers are making sustainable decisions.
When a borrower’s ability to repay depends mainly on rental income, the loan carries a higher risk if tenants move out or rent drops. These new rules simply make lenders hold more capital (money in reserve) for those riskier loans, which means they’ll underwrite a little more cautiously.
What Clients and Realtors Can Do Now
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Keep everything clean and clear. Make sure all rental income is easy to trace — leases, bank deposits, and expense records matter.
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Avoid relying solely on rent. A strong employment or business income will help keep options open.
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Be strategic about timing. Avoid stacking too many purchases too quickly using the same income.
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Understand that each lender is different. Some will apply OSFI’s rules more conservatively than others.
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Plan early. If you’re thinking of purchasing or refinancing a rental property, review your current income structure and documentation now.
A Few Important Notes
These new guidelines are still being interpreted by regulators and lenders, and finer details are expected to evolve throughout 2025. Each financial institution will apply them slightly differently based on their internal policies.
It’s also worth saying — yes, this is a meaningful shift, but it’s not the sky-is-falling scenario that some headlines make it out to be. Borrowing for investment properties isn’t disappearing; it’s just changing shape.
I’ll continue to share updates as lenders release their own interpretations and policy adjustments. We’re in a period of ongoing change, but the best approach — as always — is to stay informed, organized, and proactive.
Final Thoughts
Whether you’re a client planning your next purchase or a realtor helping clients navigate their financing options, knowledge is key. These changes are designed to bring more stability to the lending landscape, not to stop investment altogether.
If you’d like to chat about how this could affect your next purchase or want help mapping out a long-term mortgage strategy, I’m always happy to help.
Sincerely,
Amy Kiesenwetter
TMG The Mortgage Group
Mortgage Broker | Vancouver, BC