Hold or Sell? A Step-by-Step Way to Analyze Your Condo

If you own a condo in Toronto, Vancouver, or any other Canadian market that's been buried under new supply the last couple of years, you've probably run the numbers in your head more than once. Rent barely covers the mortgage. Maintenance fees keep climbing. And every week there's another headline about condo prices softening.

So, hold, or sell?

There's no universal answer, because it isn't a universal question. It's a math problem with your specific numbers in it. This post walks through exactly how to work it out, page by page, using a real (composite) example so you can see where each number comes from and plug in your own.

Step 1: Pull Your Four Starting Numbers

Before anything else, you need:

1. Current market value, a recent appraisal, a comparable sale, or your realtor's estimate.
2. Remaining mortgage balance, from your latest statement.
3. Monthly rent, what it actually rents for today, not what you paid two years ago.
4. Monthly carrying costs, mortgage payment, condo fees, property tax, and a realistic maintenance reserve.

Worked example: a one-bedroom condo in Toronto, bought in 2019 for $550,000, worth $620,000 today. Mortgage balance: $380,000. It rents for $2,400/month.

Step 2: Work Out Your Actual Monthly Cash Flow

This is the number that scares most owners into thinking "sell," so it's worth looking at closely instead of just feeling it.

Add up every carrying cost, not just the mortgage, and subtract it from rent.

In this example: $2,400 in rent against $3,130 in costs ($2,100 mortgage + $650 condo fees + $280 property tax + $100 maintenance reserve) is −$730 a month, or about $8,760 a year, out of pocket.

That's a real number and it matters, but it's only one input, not the whole answer. A property can bleed cash every month and still be the better financial decision once you account for equity paydown and appreciation. That's what the next steps are for.

Step 3: Calculate What You'd Actually Walk Away With If You Sold Today

Selling isn't "market value minus mortgage." Realtor commission, legal fees, and closing costs typically run 5-6% of sale price in most Canadian markets.

That number, not the equity number, not the sale price, is what you'd actually have in hand to invest elsewhere.

Step 4: Project Both Paths Forward

This is the step most people skip, and it's the one that actually answers the question. Pick a time horizon (5 years is a reasonable default) and project both scenarios using assumptions you'd defend to a skeptical friend:

• If you sell and invest the proceeds, a conservative long-run return assumption (this example uses 6%/year, roughly a balanced portfolio).
• If you hold and keep renting, modest price appreciation (3%/year here, deliberately cautious given current supply conditions), ongoing mortgage paydown from your tenant's rent, minus the negative cash flow you're funding out of pocket each year, minus selling costs if and when you eventually sell.

In this example, both paths start at the same $205,900 today. But because the mortgage paydown and even modest appreciation are compounding on the full property value, not just your equity , holding pulls ahead within the first year and reaches roughly $305,000 vs. $276,000 by year five, despite the monthly cash flow being negative the entire time.

Step 5: Know Which Assumptions Are Doing the Work

This is the part worth being honest with yourself about. The result above is not "holding always wins", it's what happens under these specific assumptions. Three of them will swing the answer the most:

• Appreciation rate. Drop it to flat (0%) and the gap narrows substantially; push it negative and selling can win outright.
• Investment return on sale proceeds. A higher assumed return on the alternative investment closes the gap fast, this is the "opportunity cost" side of the equation, and it's where a lot of hold-forever arguments get too optimistic about the status quo and too pessimistic about alternatives.
• How long you'd actually hold. Selling costs and the negative monthly cash flow are fixed drags that only get diluted with time. A 2-year horizon looks very different from a 10-year one.

Run the numbers at a range for each, pessimistic, base case, optimistic, rather than a single point estimate. If holding still wins in your pessimistic case, that's a much stronger signal than a base case that only works if everything goes right.

Step 6: Factor in What the Math Can't Capture

The spreadsheet doesn't know your life. Weigh it against:

• How much the monthly out-of-pocket amount actually strains your budget (a correct-on-paper decision you can't sustain for five years isn't the right decision for you).
• Whether you want to be a landlord for another 5 years, vacancy risk, tenant management, and special assessments aren't in the spreadsheet either.
• Your own timeline, a move, a life change, or needing the capital soon changes the horizon in Step 4 regardless of what the math says.

This post is for informational purposes only and does not constitute financial, legal, mortgage, or tax advice. The worked example uses composite, illustrative figures, not a specific real property. All calculator results are estimates based on user-provided inputs. Verify all figures with your mortgage broker, accountant, and relevant professionals before making any investment decision.