The “Missing Middle” refers to housing types that fall between single-family homes and large apartment multifamily units. Typical examples are duplexes, triplexes, or townhomes that are 5 stories or less. These opportunities are often overlooked in modern development but are very important to solving today’s housing challenges.
At Finalyze, we’ve supported multiple clients, who are actively investing in this space, by helping them structure deals, project returns, and manage ongoing financial reporting and tax implications. We’ve seen firsthand why this strategy works.
Why the Missing Middle Housing Matters
- It meets demand in cities short on affordable, mid-scale housing which fills the housing gap.
- Encourages walkable, mixed-income neighborhoods which support diverse communities.
- Can be added without disrupting a neighborhood’s character. It’s a natural fit.
- Missing Middle housing can typically be approved to build faster and can be turned around much quicker with lower financial risk making them attractive to lenders.
Why It’s a Smart Investment
- In urban and transitioning neighborhoods, there’s a high demand but limited supply.
- Several cities are easing restrictions. Zoning reforms are on the rise.
- You can sell as individual units, rent long-term, or hold for appreciation. This leads to flexible exit options which all investors should think about.
- It aligns with affordability and housing equity goals.
We connected with an expert in the space and a friend of Finalyze, Matt Spoke, one of the Founding Partners at Toronto Standard, a real estate firm focused on building solutions to Canada’s housing crisis. Through his firm, Toronto Standard, Matt develops both low-rise and mid-rise properties, with a core emphasis on purpose-built rental housing. In addition to development, Matt is an active voice on housing policy and advocates at the municipal, provincial, and federal levels for pragmatic, supply-focused reforms to improve housing affordability across the country.
Here’s what Matt wanted our Finalyze Facts community to know about Missing Middle investing:
“At Toronto Standard, we see Missing Middle housing as a crucial piece of the broader housing solution. It offers the chance to build real density in a way that’s compatible with existing neighborhoods without the hurdles that often come with larger, high-rise projects. From a business perspective, it’s faster to permit, quicker to build, and often easier to finance when positioned correctly. More importantly, it meets an urgent need in the market for family-friendly rental housing. For any investor or developer getting into this space, I’d say: understand your local zoning landscape, build strong municipal relationships, and work with financial and strategic partners who know how to navigate the challenges. The opportunity is huge and it’s only growing”.
Summary
Missing Middle housing offers a blend of profitability, flexibility, and impact. For investors looking to diversify, it’s a smart play in a shifting market and one we’re well equipped to help with. We’ve helped clients feel more confident, informed, and prepared to make smart decisions, and we can do the same for you. Schedule a free consultation today and let’s take the next step toward your financial and investing goals!