When it comes to investing in Toronto real estate, you’re either for it or against it. There are the skeptics that like to hang onto the headlines that prophesies that Toronto’s real estate bubble is sure to burst. On the other side you have the real estate investors and everyday Toronto homeowners that have made unbelievable equity gains simply from choosing to buy property when they did.
Toronto is an evolving world class city, joining the likes of NYC, San Francisco and London. It may seem too good to be true but Toronto’s real estate market is destined to keep its momentum. So if you’ve been asking yourself, is investing in Toronto real estate worth it? The answer is yes. And we’re here to tell you why and how to do it.
WHY SHOULD I INVEST IN TORONTO REAL ESTATE?
The Equity Gains Are Real When Buying An Investment Property In Toronto
Investing in Toronto real estate, when done wisely, can be very fruitful. Since 2015, condo prices in the 416 (Toronto Proper) have risen 52% according to TREB data. To put that in perspective, if you had purchased a condo in 2015 for $400,000, you would have made over $200,000 (or $50,000 per year) just by living there. These high equity gains when investing in Toronto real estate is one of the reasons why Toronto is one of the best places in Canada to invest in real estate.
And that’s just the Toronto average price. When you have a proper condo investment strategy, you can make better returns, faster. Some of my real estate investors have already earned between 10% and 25% on their 2018 investments. Have a look at some of my client returns here.
There’s a Huge Demand for Rental Inventory
Investing in Toronto real estate is still very profitable and with Toronto’s growing population, the demand for rentals is at an all time high, and has been for some time. Both immigration and our growing tech industry are bringing a surplus of qualified residents to the city.
The Huffington Post recently published that Toronto is the fastest growing city in the U.S and Canada with an increase of 77,435 new residents between July 2017 and July 2018. With major developments like East Harbour and several high-profile tech companies choosing to set up shop in Toronto (Uber, Pinterest, and Microsoft to name a few), the demand for available rentals will continue to climb.
Pair that with Toronto’s record high rental rates — one bedroom condos currently rent for about $2,225 per month — and your tenant can help pay down your mortgage.
It’s also worth noting that the Ford government has lifted rent control on new units, including pre-construction condos, that are being leased for the first time. You can read more about the rent control amendment here.
Canada’s Stringent Lending Practices Keep You Protected
Buying investment property in Canada is a safe investment because of the many guidelines they’ve introduced, including the Stress Test at the beginning of 2018. We’re also VERY WELL FUNDED. This recent article in the Toronto Star boasts about our extremely low delinquency rate: “We may be mortgaged to the hilt, but Canada’s loan default rate is still tiny: Just 0.3 per cent. We’ll do anything to ensure we don’t miss those payments.”