21 Sep Is Now A Good Time to Invest in Canadian Real Estate?
With Canadian mortgage interest rates at historic lows, could now be a better time than ever to invest in your own property?
Whether you’re buying a property to live in, renovate and sell on, or to add to the rental market, as with any venture that involves a considerable financial commitment, there are risks and benefits.
With many Canadians desperate to bring in a steady income after the toll the ongoing pandemic has taken on them – either to supplement their existing income, or to help them pay the bills when they’re unemployed or on sick leave – investing in real estate for rental purposes can seem like a risk worth taking…but is it?
What are the risks involved with owning a rental property?
With several commitments attached to rental real estate investments, letting your property to tenants can make you feel more as if you’re running a business. What with finding tenants, dealing with them, maintaining the property and staying on top of your finances, owning a rental property isn’t always as easy as it sounds.
Arguably entailing a higher level of risk than investing in stocks, geographical and physical problems can limit what you do with your rental property and who you can find to rent it from you.
While it is true that if you purchase a property with a 20% down payment, a rise of anything up to 20% and more, means you’ve doubled your money, this optimistic approach doesn’t account for selling costs and negative cashflow you might have experienced, especially if a tenant wasn’t paying their rent.
Experts say owning a single, primary residence is the best real estate investment
This may be true, but while there are risks involved with purchasing a second or third property for rental purposes, many Canadians can, and do make money from it, and provide themselves with a regular income for minimum effort.
Multiple-unit rental housing or commercial properties can be a great way of giving you a guaranteed income, and if they come with land or a big parking lot attached, so much the better. Providing you with an income and opportunities for long-term development, you could maximize your investment for the future. Choosing the right location will be crucial to your success as the owner of a rental property, but if you’re willing to take a few risks and can afford to do so, now could be a fortuitous time to invest in Canadian real estate.
To take advantage of rock bottom mortgage interest rates and invest in your own piece of Canadian real estate, consult with a local mortgage broker to determine what you can afford, and what mortgage might be the right fit for you.