Maximizing your investment in pre-construction condos
The number of people looking to invest in such real estate has increased tremendously along with the condominium sector throughout time. Condos are becoming more popular across Canada for real habitation, rental, or future selling purposes.
To capitalize on this boom, an increasing number of investors have chosen to invest in real estate that is still under development.
According to statistics from Statistics Canada 2020, about 40 percent of condos in Toronto aren’t even occupied by the owner, which implies they are either rented out, utilized as a secondary residence, or are completely empty.
This demonstrates how condo apartments are not just seen as places to live but also as ways for property owners to make money through rental income.
It’s likely that if you’re going to buy a house for the first time, you’ll start with the one that’s either being sold or is still being built. There are benefits to purchasing a property before construction, aside from more inexpensive ownership.
The sections below examine this real estate tactic in greater detail.
Why Buy Condos before Construction?
Under the appropriate conditions, a property that hasn’t even been built yet can generate significant returns. Developers typically give significant discounts at this point, despite the fact that you primarily rely on architectural blueprints as the basis for investment.
This is partly because they require the investor’s funds to complete the construction process. A buyer is rewarded with higher pricing based on recent evaluations for agreeing to share some of the risks by making a purchase before the shovel even touches the ground.
Pre-construction condo purchases are more advised for individuals who wish to invest and not necessarily own a house due to the delay and danger.
How to Increase Profit
You can protect yourself from the possible hazards of pre-construction investments in a number of ways.
- Buy the most affordable condo apartment available in the style you like.
- Try to invest in ones that are at least a year away, ensuring that the project actually materializes.
- Don’t simply concentrate on what’s hot right now; take a look at emerging and potentially profitable areas.
- It might not be practicable or required to purchase a parking place if the home is situated in the city’s core.
- Check if the project qualifies for any tax benefits.
- Examine the amenities
- Aim to invest on the top levels, where there are more attractive views.
- Most tenants prefer to be the first users, so advertise early.
Pre-Construction Real Estate Buying Advice from Experts
Is it preferable to buy now or wait for the market to decline in this seller’s market? What is the most profitable strategy to use your own equity in this situation?
Experts continue to favour real estate investing. The average market price will keep rising, primarily as a result of increased immigration, particularly in Ontario.
This, along with the current low-interest rates on mortgages, greatly raises the demand for houses.
A pre-construction condo purchase has benefits and drawbacks. You must carefully consider how much you can afford to invest and how much you want to put down as an investment.
Make sure you thoroughly examine the developer’s track record, the outlook for the local real estate market, and the state of the economy to make sure you get the most out of your investment.
Go to Roger Rampuri for assistance and consultation with real estate development in Vancouver! We provide all real estate clients with the highest degree of professionalism and a personalized strategy for success. Call today for an appointment.