Owning a property is a dream that many people have, especially as they start a family and want to create a home of their own. But a Toronto home is so much more than just a base, while the peace of mind and stability that it offers is very important, there are also significant financial gains to consider that will establish financial security for you and your family.
So, what makes owning a home a sound investment?
It’s a long-term, tangible investment
Compared to buying shares, owning a home is a safer investment decision that offers consistent, and often higher, growth. Unlike shares, it is a tangible asset – and it’s both low-risk and high-return. Owning a property also means that there is always the option to rent your property out, allowing you to generate cash flow while paying off your mortgage.
There is a high demand for rentals
Toronto’s high population growth rate has a direct impact on the housing market because the city’s reputation as a tech and finance hub continues to expand. Toronto is the fastest growing city in North America, and this has led to an increased demand for rental units.
It’s a leveraged investment with a strong track record
Property investment is a significantly lower risk decision compared to investing in the stock market. Stocks could dip if a company has some bad press, while the Toronto property market has shown more consistent, stable growth over the long-term.
Also, when you invest in real estate, you leverage your money as any gains that the property market makes are made on the full value of the asset.
Keep in mind that real estate typically doubles every 10 years. For example, a one million dollar property in 10 years from the day of purchase will likely appreciate to be worth 2 million. That’s 100% ROI over 10 years and one million dollars in profit.
What makes property in Toronto the best choice?
Since 2015 Toronto condos have seen the best gains, averaging an increase of 13% every year. And, if you go further back, the upward trend is consistent, averaging between 5% and 10% over the last decade. This is a good, solid base for projected future growth, making the choice to own a home a sound investment.
To get the best gains, you could consider buying a property that is:
- Priced lower than other comparable properties in the same area
- Situated in a neighbourhood that is in the process of gentrification, but property prices are still low
- Going to appreciate in value due to proposed future projects such as the introduction of a new transit line.
When you’re ready to own your own home, chat to a real estate wealth specialist before you start. Nikki specializes in matching her clients with the ideal property that matches their needs, and helps build generational wealth.