CMHC Insured Condo Construction

Compare the Bottom Line When Financing Condo Construction

To illustrate potential cost savings during condo construction with CMHC-insured financing, this example is based on a 30-month construction schedule.


* Level of presales required prior to the 1st advance, not necessarily at the time of application or approval.
** In this example, an interest rate differential of 1.25% reflects the reduced rate that a lender may charge on CMHC-insured loans of this nature. Such rates are negotiated between the lender and borrower and are dependent on various factors.
*** The interest cost calculation is based on 60% of the construction loan being advanced over the 30 month period. This is due to the fact that the construction loan will be advanced via progress draws as requested by the lender. The interest calculation is ((construction loan amount x 60% x interest rate) / 12 months) x 30 months.
**** In this example, a lender fee differential of 0.25% reflects what a lender may charge on CMHC-insured loans of this nature. The fee differential may be higher (and the CMHC advantage greater) depending on factors such as lender, region, loan size, etc.
***** 15% cost of equity required representative of mezzanine financing and / or opportunity costs. The equity cost calculation is ((equity required x 15%) / 12 months) x 30 months.
The above example is for general illustrative purposes only.
Information contained in this example is provided “as is” without warranty or representation of any kind, express or implied. The information (including the examples, assumptions and illustrations described in it) is provided for general illustrative purposes only and is not intended to provide financial or other advice and should not be relied upon in that regard. CMHC and its employees and agents shall not assume any responsibility, and in no event shall be liable for any damages (including special, indirect or consequential), in connection to or resulting from the information, its accuracy or use.