Rent-to-Own 1.0 Is Dead. The Woman Who Helped Nearly 1,000 Families Buy Homes Just Replaced It
Recorded: March 2026
Host: Erwin Szeto, The Truth About Real Estate Investing for Canadians Podcast
Guest: Rachel Oliver
Rachel Oliver has been in rent-to-own since 2010. She and her husband Neil have run one of the only dedicated rent-to-own companies in Canada — operating in Ontario and Alberta — and they have helped nearly 1,000 families get into home ownership.
She has also watched most of her competition disappear.
The market downturn did not just slow rent-to-own down. It broke the original model entirely. Rachel knows this better than anyone — because she built that model, saw it work spectacularly for years, and then watched it fail when the conditions changed.
Her conclusion: Rent-to-Own 1.0 is retired. And what replaced it is worth paying attention to.
Why Rachel Got Into This in the First Place
Rachel’s entry into real estate investing was not strategic. It was survival.
She was diagnosed with cancer during her first maternity leave. Already squeezed financially from being on mat leave, the year that followed — running from treatment to treatment, needing childcare for 50 percent of each day — drained the budget her husband had carefully built. His full-time income was not enough.
What saved them was the equity in their home. A small Ajax house they had bought from Tridel builder. By the time they took occupancy, the value had already climbed from where they signed. That equity let them stay on top of their bills and rebuild.
“I took that away and realized there are so many families that struggle through their personal setbacks — and if you do not have the stability of home ownership, it is really hard to rebound.”
That is the mission Rachel and Neil have been on ever since. Not just building wealth — enabling other families to have the same stability she had when she needed it most.
The Rent-to-Own Model — What It Was
The original model was straightforward. An investor buys a property. A future homeowner moves in, pays a monthly amount that covers the carrying costs plus a forced savings component called an option credit. At the end of a set term — typically four years — the future owner exits by purchasing the property at a pre-agreed price.
In a rising market, it worked beautifully. The pre-set exit price, typically based on 4 percent annualized appreciation, was usually below what the property was actually worth by exit. Tenants walked away with equity. Investors collected passive cash flow and a capital gain. Almost nobody had a losing scenario.
Then the market reversed.
Why 1.0 Failed
Two things broke at the same time. First, COVID changed tenant behaviour. The option credit — the forced savings portion stacked on top of rent — is optional in a legal sense. When financial stress hit, tenants stopped paying it. Without enough saved for a down payment, they could not qualify to close.
Second, valuations stopped cooperating. In roughly 50 percent of markets in 2022 and 2023, properties were appraised below the exit price that had been set years earlier using historical growth rates. Tenants who could afford to close did not want to. They were being asked to pay above market value.
“Rent-to-Own falls apart when the tenant looks at the exit price and says — you set me up in a deal where I am overpaying for a property.”
Rachel is not defensive about it. The prices were set with the best intentions and the historical data to back it. The market just did not cooperate. The honest answer is that a model built on a locked-in future price has a structural weakness when appreciation stops.
She extended deals and, negotiated splits — tenant pays an extra $10,000, investor drops by $10,000. She also found the workarounds. But she also recognized that workarounds are not a business model.
Rent-to-Own 2.0: What Changed
The locked-in exit price is gone. That is the core change.
In Rent-to-Own 2.0, the future owner and investor enter an equity sharing arrangement. The future owner comes in with a 5 percent down payment — on a $630,000 property that is $31,500 of their capital offsetting the investor’s out-of-pocket costs, bringing effective loan-to-value to 85 percent. They pay the carrying costs each month. At exit, the property is appraised at fair market value. Both parties share in the outcome.
The investor gets the lion’s share because they carry the mortgage and the title. The future owner gets a proportionate share based on how much they brought into the deal. The more capital they commit, the more negotiating power they have on the equity split.
The deal Rachel walked through on air: a four-bedroom, three-bathroom renovated home in Orangeville, purchased at $630,000 at a 5.34 percent interest rate. Cash flow to the investor after all expenses: $800 per month from day one.
“Where are you getting double-digit returns with $800 monthly cash flow in a flat market? I will do those deals all day long.”
If the property stays flat over four years, the investor still earns a double-digit annualized return from cash flow and mortgage pay-down alone. If values climb by 5 percent, that $31,500 initial contribution from the future owner grows to approximately $50,000 — a meaningful outcome for a family that could not otherwise access the market.
What Makes the Tenant Different
Rachel’s most compelling argument for rent-to-own as a passive investment strategy is the tenant profile. These are not renters. They are future owners with real money in the deal.
Out of roughly 75 to 80 live deals during the most turbulent period of COVID, Rachel had one non-payment that dragged to an eight-month eviction process. One. The rest negotiated, adjusted, and stayed invested in their outcome.
The property maintenance responsibility sits entirely with the future owner. No landlord calls. No repairs billed to the investor. The investor holds title, collects cash flow, and waits for the exit.
Rachel’s framing: if your goal is passive income with low headache and a tenant who behaves like an owner — this is the structure that gets you there.
Who This Strategy Is For
Rachel is clear that rent-to-own in any form is not for everyone. You need to qualify for an investment property mortgage at 20 percent down. You need to be comfortable with a multi-year hold. And you need to stop comparing today’s market to what it looked like five years ago.
She made this point directly: investors who have never been through the boom years tend to be more optimistic about what today offers. Investors who lived through 2021 are still lamenting what they lost. The ones getting deals done right now are the ones who decided to stop comparing.
“You cannot have it both ways. You cannot have aggressive appreciation and low prices and low interest rates all at once.”
Rachel’s own portfolio has declined in net worth on paper. She is not hiding from that. But she is also cash flowing, carrying land-based properties that she can sell when she needs to, and building a business that has now survived 16 years of every kind of market cycle.
Final Thought
Rachel closed with a quote that stuck: “Look where the puck is going versus cranking your neck to see where it was before. Even if it seems like the puck is not going in the right direction — eventually you will score a goal.”
The families still waiting on the sideline for the market they remember are waiting for something that is not coming back. The ones getting into homes today — through Rent-to-Own 2.0 or otherwise — are building equity while everyone else waits.
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To Listen:
Audible: https://www.audible.ca/pd/B0GW8JNWDG?source_code=ASSGB149080119000H&share_location=pdp
YouTube: https://youtu.be/T4BPVqWzREI
You’ve Built Wealth. Now It’s Time to Understand It.
You’ve Built Wealth. Now It’s Time to Understand It.
After dozens of consultations, I’ve noticed the same pattern again and again: most investors have built real wealth, but they’re not confident they can retire from it. They’re sitting on $2M–$5M in property but feel cash-flow poor. They’re paying more tax than they should because everything is held in personal names. They have no liquidity, no insurance strategy, and no clear plan for what happens if something happens to them. And almost every single client tells me the same thing: “I don’t actually know what retirement looks like for us.”
Real estate builds equity, but it doesn’t automatically build freedom. Without a coordinated plan for taxes, income, protection, and exit strategy, investors often end up working harder in retirement than they did in their 30s. That’s why I created the Wealth Freedom Blueprint – a simple, practical guide to help you understand where you stand today, what gaps are costing you money, and how to turn the wealth you’ve built into a life you can actually live.
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Final Thoughts
Whether you’re building wealth, protecting it, or preparing to transition it, you deserve a clear, tax-smart strategy that works in real life.
That’s what iWIN Wealth Planning is here for.
This is how we’re creating predictable, stress-free wealth for Canadian families…
so you can enjoy the life you’re building.
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Sponsored by… Me!
This episode isn’t sponsored—except by my wife Cherry and me. Real estate investing is our life. It’s helped us build wealth and achieve peace of mind about retirement and our children’s future.
Till next time—just do it. I believe in you.
Erwin Szeto
W: erwinszeto.com
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IG: @erwinszeto
Disclaimer
As a committed advocate for transparent and responsible investing, I want to disclose that I am an Advisor to SHARE SFR (Single Family Rental). I hold equity in the company and earn referral commissions from clients I refer.
My endorsement of their model—focusing on positive cash flow and direct ownership—is based on personal experience and belief. Still, every investor should do their own due diligence.
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