Are you interested in increasing your personal wealth and providing for your retirement by investing in property? If so, is it possible to make a living from renting out houses to people who either cannot afford to purchase a home, or they are not interested in buying a home? Can you turn a profit from buying a home, keeping it for a while, and then reselling?
You aren’t alone in your interests. Historically, investors have benefitted from purchasing investment properties in Toronto. Some investors purchase run-down, dilapidated homes, fix them up, and then flip them. On the other hand, investors purchase houses for their rental income.
There is currently an undersupply in the Toronto real estate market; thereby, making the housing market a sellers market. Furthermore, house prices will more than likely remain at their current elevated levels for the foreseeable future. If you are a first-time buyer, the high prices can be offset by a reduction in the land transfer tax.
It also make sense that properties in areas closer to the city centre are going to cost more than similar properties in rural areas. This is primarily to do with supply and demand. If there is a demand for housing, there will be a shortage, which will in turn drive both the purchase and sales price higher.
When considering what property to purchase, it is important to take your investment goals into account. Are you looking at a long-term investment, or do you want to buy, renovate, and sell at a profit?
If you are considering a short-term investment, it’s vital that you study the real estate market and the area where you want to purchase a property. The question that you need to answer is: “will this house sell for more than I bought it?” It also stands to reason that the purchase price needs to be as low as possible so that you can realise as much profit as possible. Of course, you cannot just calculate the purchase versus the resale price. You need to add in all the sundry fees as well as the renovation costs.
On the other hand, if you are looking at purchasing several properties as a long-term investments then you will need to rent these properties out in order to pay their mortgages. Consequently, it is important to look for property to purchase in high-demand areas. In my opinion, it does not make sense to invest in a property in a rural area where very few people want to live.