By Ryan Coyle Toronto
Investing in Condos in Toronto – There is no Better Time Than Now
Looking to make money in Toronto’s real estate market? You aren’t alone. Investors have long been attracted to Toronto’s condo market due to its deep-rooted stability and incredible growth potential. The country’s hottest condo market has seen a huge surge in sales over the last few years and still continues to be the most affordable choice for potential property owners. It is therefore no wonder that more and more people are looking at investing their money in the Toronto condo market.
Thinking about making an investment in Toronto Real Estate?
“The best time to invest was yesterday. The next best time is today.”
Here’s what you need to know before you get started:
The City
Not that long ago, Toronto was developing in a manner where there was a significant amount of urban sprawl. Recognizing the hazards of this type of growth and development, the Ontario government passed the ‘Places to Grow Act’. Since then, the nature of home construction has shifted from single family detached and semi-detached homes in the outlying regions of the GTA to condo buildings popping up all over the city. Today, Toronto is widely regarded as being among the world’s very best cities in which to live due to its diversity, strong economy and robust job market. Therefore, it is no surprise that Toronto real estate is full of investment potential, especially in the condo market.
The Benefits
Investing in Toronto is a great opportunity for consistent cash flow from a property that will gain significant appreciation over time. More than ever Torontonians are looking for the convenience of condo living. Vacancy rates remain extremely low (0.4% in downtown Toronto) and condo rents continue to soar in the GTA. Also, buying a condo, especially in the case of pre-construction usually means having to do less work than investing in a house which can require significant maintenance and up-keep. Investing in the Toronto condo market, is a great starting point for long-term financial success
The Location
Toronto renters aren’t just looking to rent anywhere; they are looking for a lifestyle. Finding the right property in the right location will determine how successful your investment will be. Finding professionals with local insight as well as a close relationship with the top developers in the city is important. At CONNECT asset management we only work on those projects that we know will produce the biggest returns for our clients. We can show you the best established as well as up-and-coming areas that will attract your ideal tenant and give you the best resale value. Investors understand that the quality of the location will influence the type of renters attracted to the property as well as how quickly your investment will appreciate.
The Expertise
While a large number of clients have been investing in the Toronto condo market for years, we also work with first time investors who are new to the game. Whether or not this is your first investment, it is important to have the guidance of a qualified team with a solid track record in the Toronto condo market to help you understand things such as taxes, costs and fees, building plans, assignment clauses, etc. The right professional will also get you access to the best properties and help you manage your property for the long-term.
Want to Learn More About Investing in Condos in Toronto?
Let’s talk today. Contact the experts at CONNECT Asset Management so that we can find the right investment for you.
Investing in Pre-construction Condos in Toronto
Investing in Pre-construction Condos in Toronto’s hot real estate market have become a very popular form of investing. In spite of growing concerns regarding market saturation and shifting costs, there is still HUGE demand for the best projects every year and condo sales remain very strong in the GTA.
As realtors specializing in the pre-construction phase, we know that this is the best time for investors to buy a condo. Most people know that if purchased early in the cycle, the home builder generally offers more competitive pricing. While the lower pricing and greater choice afforded by the pre-construction phase is certainly a big selling point for potential investors, it is really only the tip of the iceberg. Pre-construction condos offer some of the best returns you can find in an investment and it’s important to know why when trying to weigh the differences between the resale and pre-construction markets. Investing in a pre-construction condo offers many advantages that other types of investments don’t. Below I have recapped some of the most important one’s for you:
ONLY BUY PRE-CONSTRUCTION CONDOS – HERE’S WHY;
Favorable Financing
When purchasing a resale unit, you need a 20% down payment up front. With a pre-construction unit, you only need 10-20% down and that is spread out over multiple payments ranging from 365 to 540 days. During this time your deposits are safe in an interest-bearing trust account.
The Power of Leverage
You don’t need to take out a mortgage until final close, so for the 3 to 5 years before completion of the condo, you are leveraging the developer’s money. In theory, prices will rise significantly during that period, but when it is time to take out a mortgage and close on the property, you are still buying at the original price. This means that you are purchasing the property at a BIG discount. Your deposit has grown into significant equity because of the price appreciation and leverage you received from the developer on the full value of the property.
Rents - Have Your Tenant Pay Your Mortgage for You
In the past year Toronto condo rents have climbed 11% and we are now the country’s most expensive rental city. How many investments out there allow you to have positive cash flow on day one? Young professionals who make up most of the rental pool, want the convenience of condo living, while being within close proximity to work and amenities. By renting to the right tenant in the right location, your tenant will pay off your entire mortgage for you.
“Mortgages are typically paid off over 25 to 30 years, but with the right property this can be as quick as 15 to 20 years with only 20% down. Let us help you find the right property and tenant.” – Ryan Coyle, Co-founder of CONNECT Asset Management
Instant Equity
On account of the price appreciation and leverage from the developer over the 3 to 5 years, you will have SERIOUS EQUITY built into your property when you close. This gives you the opportunity to refinance your condo and take out the new equity to invest it into more property. Refinancing allows you to take equity out of your property tax free. You won’t have to pay taxes on this money until the property is sold, whether that is in 1 year or 100 years. The CONNECT Investment Blueprint can you help you do this.
“Ask any real estate tycoon how they made their fortune in real estate and they will tell you that they used leverage and refinancing.” – Ryan Coyle, Co-founder of CONNECT Asset Management
At CONNECT Asset Management we know that buying pre-construction is an essential part of The Long-Term Growth Story. We believe that pre-construction condos are the best real estate investment opportunity available for independent investors. The success of the pre-construction process rests on you. Take advantage of the experts at CONNECT Asset Management to find you the best place for your investment.
Ryan Coyle Toronto and Managing Director and Co-Founder of CONNECT asset management has been investing in real estate assets for over 20 years and has developed a strategy to help him and his clients accumulate large portfolios of cash-flowing properties.
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