MLI Select Program: Unlocking Affordable Multi-Unit Housing in Canada

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Introduction: Is Financing Holding You Back From Building Multi-Unit Rentals?

If you’re a real estate developer or investor in Canada, you’ve likely faced challenges securing cost-effective financing for multi-unit residential projects—especially if you aim to include affordable or sustainable housing elements. The MLI Select program from CMHC is designed to change that.

This article explores how the MLI Select program works, who qualifies, the benefits it offers, and why it’s becoming a go-to solution for financing multi-unit residential developments with affordability, energy efficiency, and accessibility in mind.

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What is the MLI Select Program?

Launched by the Canada Mortgage and Housing Corporation (CMHC), the MLI Select is a mortgage insurance product that incentivizes developers to create rental housing that aligns with Canada’s social and environmental priorities.

It’s tailored for:

• New construction

• Substantial renovations

• Refinancing existing rental properties

To qualify, projects must include five or more rental units and meet a minimum threshold of 50 points from a flexible scoring system focused on:

• Affordability

• Energy Efficiency

• Accessibility

The more points a project earns, the better the loan terms.

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How the MLI Select Points System Works

CMHC’s MLI Select scoring encourages a mix-and-match approach. You can qualify by prioritizing one area or spreading efforts across all three.

1. Affordability

Points are awarded based on:

• The percentage of units priced at or below 30% of the local median renter income

• The duration of the affordability commitment (10+ years minimum, more points for 20+ years)

Example:
A building with 40% of units under the affordability threshold for 20 years can earn 50+ points solely from affordability.

2. Energy Efficiency

Earn points by exceeding the baseline performance of the National Energy Code for Buildings (NECB) or equivalent.

• Retrofits or new builds that achieve energy reductions of 25%-40%+ compared to code may qualify.

• Certifications like ENERGY STAR, Passive House, or LEED can help meet these thresholds.

3. Accessibility

Projects incorporating universal design features, barrier-free units, or meeting third-party certifications like Rick Hansen Foundation Accessibility Certification will gain accessibility points.

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Who Can Benefit from MLI Select?

Real Estate Developers

• Access up to 95% loan-to-value (LTV): A minimal 5% equity injection can get your project off the ground.

• Extended amortization: Up to 50 years, with some cases going to 55 years for long-term viability.

• Lower mortgage insurance premiums: Reduce costs significantly over the life of the loan.

• Reduced DSCR requirements: Just 1.1x instead of the typical 1.25x+, which improves financing capacity.

Smaller Investors

• Makes entry into multi-family investing more feasible with lower capital requirements.

• Good fit for purpose-driven landlords looking to align with ESG (environmental, social, governance) principles.

Renters and Communities

• Increased access to affordable housing

• Higher standards for energy efficiency, lowering utility bills

• Barrier-free living for individuals with disabilities

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Key Financing and Repayment Terms

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Example Use Cases

Case Study 1: Urban Affordable Housing Build

A developer in Halifax designs a 30-unit building, with 50% of units designated as affordable for 20 years and includes solar panels to exceed NECB by 35%. They earn 60+ points and secure:

• 95% LTV

• 50-year amortization

• Reduced premiums

• Lower monthly mortgage obligations, increasing long-term cash flow

Case Study 2: Retrofit for Accessibility + Energy

An investor renovates a 10-unit walk-up in Toronto, installing energy-efficient HVAC and making 4 units fully accessible. They earn 52 points and receive:

• Low premium financing

• Amortization of 40 years

• Entry into a higher rental market while supporting inclusivity

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How to Apply for MLI Select

1. Review CMHC guidelines: CMHC MLI Select Overview

2. Score your project using CMHC’s online tools

3. Work with a CMHC-approved lender

4. Submit energy reports, accessibility certifications, or rent roll projections

5. Receive conditional approval and proceed with financing

Tip: Projects that consult early with an energy advisor or accessibility planner are more likely to maximize their score.

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Advantages Over Traditional Financing

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Frequently Asked Questions (FAQs)

1. Can I refinance an existing building with MLI Select?

Yes, as long as the property meets or is upgraded to meet the scoring requirements.

2. What happens if my project doesn’t reach 50 points?

You won’t qualify under MLI Select, but may still be eligible for traditional CMHC-insured financing.

3. Are mixed-use buildings eligible?

Yes. Projects must be at least 50% residential to qualify.

4. How do I prove energy efficiency?

You’ll need documentation such as energy modeling reports, audits, or certifications (e.g., ENERGY STAR, Passive House).

5. Is MLI Select available across Canada?

Yes, it’s a national program applicable in all provinces and territories.

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Conclusion: Is MLI Select Right for You?

Whether you’re a seasoned developer or a small investor, CMHC’s MLI Select program offers one of the most favorable financing paths available for multi-unit residential properties in Canada. With high LTVs, long amortizations, and incentives for affordable, efficient, and inclusive housing, the program aligns strong business economics with social and environmental impact. To read about Canada’s Real Estate Lending boom, please click here

Take the next step:
Speak with a CMHC-approved lender or mortgage broker to explore your eligibility—and start planning your next project with purpose.