The Address PM ●
September 1, 2019
Toronto Real Estate Investment
According to the Canadian Real Estate Association, CREA, the average property price in Toronto has soared from $314,000 in 2009 to $826,000 in 2019. Although the rate of growth varies each year, property investment is one of the most stable investments, especially when compared to volatile stocks and commodity assets.
The demand for rentals is at an all-time high. There is a surplus of qualified residents, due to immigration and a growing tech industry. As a result, rent rates have rocketed, making ideal conditions for property investment. Whether you reside in Toronto or are looking to make a foreign investment, this guide will help you to make the most of the real estate market.
Toronto Real Estate Investment Aims
There are essentially three goals for investors: Appreciation, Equity and Cash Flow.
Toronto house prices continue to appreciate, condo prices have increased as much as 52% since 2015. A Property bought now would increase in value over time, offering a lucrative resale value when sold in the future.
Increasing rent rates teamed with appreciation, can build equity quickly and reliably, resulting in favorable cash flow.
Favorable Market Conditions
Canada has stringent lending protocols, protecting the investor. There are two main aspects: Stress Test and Rent Control Guidelines.
Reduced Stress Test Rate: Canadian Banks have a set of rules that determine if one qualifies for a loan, this will take into account: credit history, down payment, mortgage size and interest rate. Recently the Bank of Canada had lowered the rate from 5.34% to 5.19%, making it easier to qualify for a mortgage loan.
Changes in Rent Control: The rent control laws have altered in Ontario. New buildings are exempt from rent control, which could act as an investment incentive.
The current market environment protects against delinquency and enhances investment returns.
When to Invest
‘The best time to invest was yesterday, the second-best time to invest is today’.
Property prices continually grow, especially in Toronto. To get the most worth out of your money, it is important to invest early to benefit from appreciation.
At The Address Property Management we work with qualified realtors, to help you find the perfect investment opportunity. We are with you for the long run and make sure you invest in the best properties.