Is investing in real estate still a good idea for Canadians?
Updated: Nov 18, 2019
Don't let the headlines drive your investment decisions
Treat real estate investing like a business
For most people, their first experience with real estate investing is through the purchase of their first home or condo as their initial primary residence. The time and diligence involved with this initial investment really helps people appreciate the actual work involved in finding a good home.
But when it comes to an investment property the effort starts to change and they tend to focus on just two primary data points being purchase price and potential sale price. if you speak to a seasoned real estate investor they will tell you this is a big mistake.
For most real estate investors the key to successful real estate investing is one thing and one thing only... positive cash flow.
While it can be much much harder to find a cash-flow positive property in higher-priced real estate markets like Toronto or it's surrounding suburbs like Aurora or Rcihmond Hill, it’s not entirely out of the question.
It’s the initial idea of a large lump-sum deposit that tends to frighten most potential investors. However if you were to invest in stocks or bonds as another example, in most cases you would also need 100 percent of the purchase cost.
With Real Estate Investing you can use the tremendous power of leverage. For example, usually with real estate investing you only have to pay 20 percent of the purchase price to own 100 percent of the property.
Gambling solely on a property’s future price is not a great method to invest in real estate, To be successful treat it like a business and look at all the key factors, but the heavy emphasis should always be placed on cash flow. The income earned should easily cover all expenses, with a little left over for good measure.
If you are looking for help buying, selling or investing in real estate myself and my real estate team are here to help. We specialize in real estate in Aurora, real estate in Newmarket, real estate in Richmond Hill and real estate in Vaughan. We also help with investing in real estate in pre-construction condominiums all over Toronto and the GTA. Whatever your direction in real estate, you can always turntotammy.