Purchasing a property for investment can be a great idea. This has historically been an excellent venue for building personal net worth. There are certain “pockets” (locations) that seem to have an abundant supply of renters for residential and commercial properties.
It definitely pays to do your homework on the property market before you dive in, and we are there to assist you when it comes to financing your decision.
Building your wealth with property can be a solid long-term option, especially if you arrange your finances to your greatest advantage. The better you manage your assets and your home loan, the better the returns you can expect.
So, what type of investment properties are there:
- Rental Property (most common)
- Condo units
- Renovation project or “The quick flip”
- Rebuilds
- Second homes
- Pre-construction homes from builders
- Commercial Units or Multiplexes
How do you determine which one is best for you? Typically, someone who is going to invest will already have an idea of what they are looking to do. But if you are in the position where you have some extra capital that you want to put to work, then you need to ask yourself a few questions:
- What type of risk are you willing to take on?
- Is this a long term or short term investment?
- Can you handle the extra payments every month or just the initial investment and need rental income?
- Is this something you would like to do full time or just a small long term investment?
Take our “What type of Investor are you” Quiz HERE
Once you have that narrowed down, you can begin to weigh out your options in a little more detail and decide which direction to go in. A rental property in the right area can offer you a fairly consistent long term investment. A renovation on the right house in the right area can offer a quick return if you have the capital to manage it properly. A commercial unit is more for people who do this for a living, but can be done otherwise, and pre-construction can sometimes offer a modest return without ever having to move into or rent the home. These are all things you need to consider.
Overall, however, real estate has traditionally been and remains a pretty sound investment that can offer you great returns if done properly. Like any investment, make sure you do your homework and talk to the right professionals to get the most value and more importantly to protect yourself.
If you would like to look at what type of investment you can afford or the financing particulars on one, give us a call or flip us an email and we would be happy to discuss with you obligation free.
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Have any questions, need any advice? Visit us at www.thefinancialforum.ca. Email us at mortgages@thefinancialforum.ca. Call us at (877) 335-4486.
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