Are Condos in Toronto a Good Investment?
Written by: Erica Mary Smith
Posted on: October 22, 2015
With so many new condos for sale in Toronto, many young people are taking their first step into the housing market by investing in their own condo. However, for people who have never bought or invested in property before, purchasing a condo can be an overwhelming and intimidating experience. For those without the help of a skilled realtor, it can be hard to tell if condos are a good investment, whether the housing market is favourable, or when is the best time to invest.
Why Are Condos so Popular?
Condos have become an attractive option for first-time homeowners and investors. In fact, Toronto has the largest condo market in all of Canada, and construction of condos in Toronto has hit a 25-year high. So why exactly are condos so popular in Toronto and other cities? One reason is that condos offer luxuries and amenities while remaining competitive in pricing. On average, a Toronto condo costs $300,000 less than a house and offers many attractive features that a house typically will not. These can include pools, exercise gyms, underground parking, spacious balconies, concierge service, and other amenities.
As well, new condominiums being built offer cutting edge architecture, design, and interiors, and open up housing in prime locations. Condos are available throughout Toronto, from the heart of downtown to uptown locales, making them attractive choices for people looking to live in their perfect neighbourhood.
Are Condos Being Overbuilt?
One constant fear with investors is that too many condos are being built and that the condo market will crash. Predictions of condo market prices dropping have been around for the past ten years. Indeed, with condos in Toronto being built at a 25-year high, many people believe a house would be a safer, although more expensive, choice.
Yet the stats just don’t bear this out. New and resale condo sales continue to grow despite more condominiums being built, and condo rents are also increasing. Demand is still high. A recent report from the Canada Mortgage and Housing Corporation (CMHC) found that condo investors are holding onto their properties for the long-term, which is the opposite of what would be expected before a “condo crash”. In fact, indications are that condos remain one of the better investments for first-time buyers. Foreign ownership is relatively low in Toronto’s condo market, which means that there is real demand for units.
How Can You Make the Right Investment?
When it comes to investing in a condo, it is important to understand and research any decision you make. While every indication is that new condos in Toronto are a great investment, each property has to be looked at individually to see if it’s a good investment and if it’s right for your needs. Consider the cost, fees, the condominium’s rules, and the history of the building. Working with a professional broker or realtor will ensure you make the right decision.
Condo Chicks from Stomp Realty Inc. is a dedicated team of realtors who are behind some of the most prestigious and prominent condominium sales in the Greater Toronto Area. We take pride in negotiating on your behalf to represent your best interests. For more information, please visit our website.
Marr, Garry, “Condo investors in Toronto and Vancouver here to stay, CMHC survey says,” The Financial Post, May 22, 2015, http://business.financialpost.com/personal-finance/condo-investors-in-toronto-and-vancouver-here-to-stay-cmhc-survey-says