Lots of people ask us as a part of their seek for a condominium, which ones are better investments. Personally, if I knew the answer to that 100%, I’d be writing this from my own private island. Alas, that isn’t the case and I write in my home office, searching at the snow.

There isn’t a hard and quick rule with regards to funding condos. Numerous it is dependent upon what exactly you are looking to get out of it. Some people think of funding condos as leases, while others are thinking of sales value down the road.

If you are seeking to buy a rental to hire out, then there are a few factors it’s essential consider.

First, do not just buy the smallest and/or least expensive unit you may find. Not too many people are going to want to live in it – would you? Instead, think of who your target market is going to be. If you’d like singles, then one bedroom condos can be fine. When you get to couples (with the potential of children), then you will want to think more when it comes to bigger items with bedrooms.

Speaking of which, there has been a current hue and cry over the dearth of condos which can be suitable for families. Certain, there are a couple of tired old buildings with three bedroom models, but they are few and much between. The place are the new items? What are the options for the families that do not need a house? Or those than can’t afford a house? Before I get to really ranting, I just needed to point out that condos should be equal opportunity. They don’t seem to be just for singles or couples or empty-nesters. Some people want to raise a family in the sky. Time to do something about it. Anyway, on with the article…

Location is also going to have a bearing in your goal market, or on the available pool of renters who will make up your market. In order for you primarily college students, then look to purchase close to U of T, York, Ryerson, etc. Don’t forget the smaller schools and faculties, equivalent to George Brown or Sheridan. There are a lot of students in Toronto, so there are quite a lot of options so that you can enchantment to them.

The flip side of course, is that if you don’t want student renters, do not buy close to the place they might want to live!

In order for you doctors and nurses and interns and the like, then you are going to wish to purchase along Hospital Row, or not too removed from it. Sure, there are more remoted facilties across the city, but keep close to the place the biggest renter pool is prone to be.

Many people usually ask about new condos versus resale as rental properties. This is a hard one, but my intestine feel is that new buildings are usually not the most effective bet. Perhaps if you are going for a 1,200 sq. foot penthouse with a view to die for, however a simple one bedroom just puts you in the pack with everybody else. If a 300-unit building has 30 folks buy to hire out, you’ll be dealing with some stiff competition to get a renter into your unit. You may be best to simply avoid that form of competitors and look for resales or smaller new developments.

Talking of competitors, this may be a very good time to delve into a dialogue of rents and their recent decline. With all of the condominium action in Toronto the past few years, many units have been constructed and plenty of have been bought to lease out. As with any market, supply and demand dictate pricing. When there are more units than renters, there’s more and more competition to get these lease dollars. Thus, rents go down.

Even with a decline in rental amounts, if you’re buying as an investment, it’s worthwhile to take a look at the larger picture. Don’t expect to pay your mortage and condominium fees – and make a profit. Those days are gone. But add up all the monthly bills and if you get a rental amount that isn’t a lot less than you might be spending, then it’s important to think about it more in terms of your mortgage only costing you $a hundred a month. Even whether it is $300 a month, that is significantly less than if you had been paying everything yourself. You aren’t getting much for nothing today, so be completely happy that somebody helps subsidize your mortage.

Now, there’s another group of people who find themselves thinking more about sales within the future. Some could also be shopping for a condominium off plans with the thought of flipping it as soon as the building is done. I do not want to repeat myself, but basically re-read what I said above about buying in a new development to rent. Being one of many herd is just not at all times a very good thing.

It was that buying new and selling it after dwelling in it for just a few years was assured profits. Not a lot anymore. Land costs and building prices are up, plus builders know they’ll get more for their product. Thus it’s a must to think more strategically these days.

There are three things I generally advise when people ask me what to purchase that will increase over the years.

First is to buy large. Buy as big a condominium as you may afford. This is for two main reasons. The primary is as above, in order to not be one in all one hundred one bedroom units for sale in a building. The second is that a big section of future condominium buyers are going to be empty-nesters and downsizers. Many older couples will probably be leaving their bigger houses and they don’t seem to be going to wish to live in a 650-square-foot one-bedroom condo.

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