Rental vacancies are ridiculously low and demand for rental units is high… and growing!
That’s just a sampling of the opportunistic real estate investment news Ted Tsiakopoulos, CMHC’s Regional Economist for Ontario, shared recently at the Canadian Mortgage Brokers’ Association (CMBA) of Ontario annual conference.
Here are other main takeaways:
- Strong 2017 economy helped ease imbalances
- Sales and new home starts expected to slow
- Prices to grow moderately
- Eastern & Western Ontario will outperform Southern Ontario
- Mortgage delinquencies remain at record lows – much lower than credit card or car loan debt
There was so much data that I can’t cover it all here. Thanks to Ted for providing this extensive info!
Can you say, Opportunity?
Increased investor demand is presenting an opportune time to examine rental property options. Look, buying a rental property has always been considered a sound investment, provided you go into it with the right expectations and a solid game plan. Rental properties should be held for the long term – at least seven years in order to recover your acquisition and disposal costs. (Click here to read more about investing in real estate long term.)
I’ve seen an increased demand by investors to purchase rental units. The reasons are simple. Demand is high. Rents are higher than ever before. New rental units (properties that have never been rented before) can charge whatever the market will pay. Yup, that’s right… you can charge whatever the tenant is willing to pay.
Just don’t forget that, after your tenant moves in, you’ll only be able to increase rents as set out by the Ontario government. Over the past 10 years, that increase has been around 2% or less.
Don’t let that discourage you. There are provisions to increase the rent for more than the annual approved rental increase rate. A major renovation or substantial increase in your property taxes are grounds to apply to the Landlord and Tenant Board for a rental increase above the annual guideline.
The perfect storm for property investment opportunity: Demand for rental housing is way up. Supply of available rental units is down. Sounds like a great time to look at buying a rental property.
If you’re interested in digging deeper and conducting a cash-flow analysis, contact an experienced Mortgage Broker.
Your best interest is my only interest. I reply to all questions and I welcome your comments. Like this article? Share with a friend.
Steve Garganis: 416-224-0114; firstname.lastname@example.org
As an industry insider, Steve will share info that the BANKS don't want you to know. Steve has appeared on TV's Global Morning News, CBC's "Our Toronto" and The Real Life TV show. He's also been quoted in several newspapers such as the Globe and Mail, The Toronto Star, The Vancouver Sun, The Star Phoenix, etc.