Real estate remains a strong investment

The world-wide recession has turned many financial markets topsy-turvy – at least in the short term. If you’re hoarding gold in your safe-deposit box, then congratulations! Sell high, because you likely won’t see these prices again! If you’re sitting on a piece of real estate, particularly a condo investment in Toronto, congratulations again! You probably won’t see these prices as low as they are now. What’s the difference? Well, you can always mine more gold. However, creating real estate is a lot harder, particularly if you are in a high-density area.

So, should you invest in a condo in Toronto? Unlike gold, it has little downside risk from a price standpoint. Simple supply and demand dictates that real estate in concentrated areas like downtown Toronto is likely to rise in price over the next few years, and probably well into the future. The latest statistics (November 2010) from the Toronto Real Estate Board indicate that Toronto real estate prices rose an average of 5% over the previous year. In fact, if one views the long-term price pattern for Toronto real estate (http://www.mississauga4sale.com/TREBprice.htm), it is unquestionably upwards trending. There is nothing to indicate that this won’t be the pattern in the future.

If you’re looking for short-term profits, then day-trading in the stock market may be for you! Or, see discussion of gold above. If you’re in it for the long term, and also want a comfortable place to live, put some focus on new condo investment in Toronto. Remember, they’re just not making land like they used to!

Before you step out on that diving board and dive in, here are some tips to remember when considering investment (and living!) in a Toronto condo development.

7 Condo Investing Tips:

1. Be very explicit about your goals. As the Cheshire Cat said in Alice’s Adventures in Wonderland, if you don’t know where you’re going, then it doesn’t matter which way you go. There are many tradeoffs in condo investment, unless you have unlimited funds. Be sure of what you want, because you’ll probably get it.

2. Do your homework. An informed investor is a smart investor. There’s plenty of dazzle with new condos, and most of it is quite attractive. But, it’s got to fit you and the lifestyle you desire. So, evaluate your goals and match them up as closely as you can with what’s on the market.

3. Get good advice. First and foremost, a reputable real estate agent who knows the market you are looking at. Second, a financial adviser to make sure your assumptions and financial calculations hang together. Third, an attorney to ensure there’s nothing in the fine print that you can’t live with.

4. Prowl the territory. Spend days, if not weeks, investigating the neighborhood. Accost total strangers in condo lobbies and ask about their living experience. Try the restaurants, the night clubs, the transportation system, the shopping outlets and find what works and doesn’t work for you.

5. Shop for a mortgage lender. In particular, ask about their fees and closing costs. Request a good-faith estimate from one or two that strike you as people you can do business with. Get pre-qualified for a mortgage so that you have that to bring to the table when shopping for a new place.

6. Tour the units on the market or, if the development isn’t complete (or even started), request your agent to show you similar properties. Ask yourself, “Can I see myself (ourselves) living here for years?” Life is full of choices – do I want to live in a smaller space and not have to mow the lawn or shovel snow? Most important – be honest with yourself.

7. Take a deep breath. Everything is in place and you’re at the closing. Don’t get cold feet, but take a few moments to reflect on all you did to get here (see above). Does it feel right? If yes, sign on the dotted line. Does it feel just a little uncomfortable? Probably, but on reflection, it is just a normal case of the nerves before making a major commitment. Does it feel bad? Don’t do anything (and don’t let anyone force you to do anything) that you don’t feel reasonably good about. Step back and re-evaluate.

HomeLife/Response
Realty Inc. Brokerage
Independently Owned and Operated

Andrew Dawid

Sales Representative

(416) 917-0653

info@condosdowntowntoronto.net

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