The mechanism is straightforward: a lender that counts a permitted suite's rent as income effectively raises the household income used in the 44 percent total debt ceiling, which can qualify a buyer for a higher price than the same income alone would support.
The catch is that an unpermitted suite counts for close to nothing on a mortgage application, even if it is fully finished and already generating rent, because the lender is underwriting the legal income, not the cash in hand.
Joel Dyck can point buyers toward listings with a documented, permitted suite rather than a promising-looking basement with no paperwork. Get your hand-reviewed valuation from Joel Dyck.