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The Pros and Cons of Condo Investments in 2019

  • March 17, 2019
  • Blog
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The Pros and Cons of Condo Investments in 2019

Investing in real estate in Toronto can feel a little daunting, especially to those new to the industry. However, now may be one of the best times to invest, specifically in condos. The reasons are many: lower mortgage payments than detached homes, higher average selling prices, and a growing rental market that definitely favors landlords…it’s a great time to say hello (or rather, invest) in a new condo!

‘But the 2018 market was so volatile!’

We know, buying property seems like an insane thing to suggest based on 2018’s GTA real estate market. Last year, it seemed like many news sources and articles were saying things like “the market is having lots of highs and lows right now,” “hold off on purchasing until there is more certainty,” or “hold off on selling until there is more demand.”

It’s important to look beyond 2018

Fast forward to 2019 and here’s what you need to know about the real estate market in order to understand that now is a good time to buy.

Vacancy rates in the city are very low, ranging between 1.5-2%, which means there is very little supply available. What’s more is the population of the GTA is projected to grow to 7.4 million by 2021, an increase of more than 550,000 residents. Between immigration mandates, interprovincial migration, international students, foreign workers, and millennials currently waiting to buy their first property, there’s a flood of demand, with very little supply.

If there is high demand and low supply, won’t the prices be higher?

Good question – especially because it helps us to point out why condominiums are such a sweet spot in this market. There’s a sizeable gap in affordability between condominiums and non-condos. Roughly 72% of one’s income goes towards their mortgage payments on average for non-condos. For condos that percentage is drastically lower at 42% on average. Furthermore, the average selling price for condos has not skyrocketed in recent years, like semi-detached or detached homes, and are only up roughly 7.8% since 2017. There are new condos being built in the GTA on a regular basis, many that would serve as excellent investment opportunities with potentially great ROI.

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Opportunities that Hello Condo suggests:

Two amazing investment opportunities coming into the city in 2019 are Azura and Prime Condos. Both projects have entry levels at about $400K, and can be found in ideal neighborhoods for potential landlords.

Azura will be located just south of Yonge Street and Finch Avenue. An area with a growing food scene and great nightlife, the area is a hub for transportation. Getting around the city is incredibly easy as you’re close to both the TTC and Viva transit. There are excellent amenities available throughout the area, from small markets to large grocery stores, book stores, coffee shops and fitness centres like GoodLife.

There are nearby tennis courts and running tracks, as well as excellent elementary and secondary schools, community centres and parks. On top of the property’s proposed 339 suites, there will be 12 townhouse units available as well, and the building will feature all of the top amenities. With affordable entry rates, this would be the perfect place for a young couple to start a family and start investing in their future.

Prime will be located at Jarvis Street and Gerrard Street East, right in the heart of Toronto’s Garden District. It’s just minutes away from both College and Dundas subway stations, close to major streetcar routes, and right in the centre of the city. It’s close to fantastic restaurants, excellent medical and dental facilities, and, of course, parks and gardens such as Allen Gardens.

The highlight of this property for investors is its proximity to Ryerson University. This property is just minutes away from the heart of Ryerson, and would be the perfect location for any student who doesn’t want to live on campus in a shared residence. With such affordable entry rates, it’s the perfect investment for landlords with a built-in market for students, whether they’re currently doing their undergrad, working on a two-year masters degree, or committed for a few years with a Ph.D. The building’s amenities include a gym and yoga room, 24-hour concierge for added security, party rooms, an outdoor terrace, and ground-floor retail spaces.

Sounds interesting! What now?

Depending on your goal with investing in property, these two options would offer significant ROI with low risks, while adding more supply to the marketplace to match the current demand.

 

Want to find your best investment solution?

Explore the HelloCondo website offerings to see what condo investment opportunities are available to you. Whether you’re a first time home buyer or someone looking to make a rental property (or several rental properties), think of HelloCondo as your solution to connect you with your ideal property.

Get in touch today at info@hellocondo.ca.

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