The housing market in Toronto is booming as the city's Regional Real Estate Board predicts that home sales and prices in the Greater Toronto Area will rise in the second half of 2023. According to the report on Canadian Mortgage Professional Magazine, the average selling price for all properties would reach $1.14 million. With Toronto’s growing population and advances in the commercial sector, the demand for residential property and office spaces continues to surge, and this means investing in a property business can be lucrative.
But before you can set foot in Toronto’s real estate market, there are factors that you need to consider. These factors include ideal property investment locations, type of property, and funding for Toronto entrepreneurs. Keep reading to learn a few essential tips for starting a real estate business in Toronto.
Know Your Real Estate Investment Options
The first step to becoming a successful real estate investor is defining your goals. Ask yourself how long you intend to stay in the property market, why you’re investing, and how much you wish to earn. Defining your investment goals helps you choose the right properties for establishing a successful real estate business. Your real estate investment options include resale condos, residential rental income, flipping properties, commercial property rental income, and new construction. Each option has pros and cons, so research the market carefully and pick an investment property that guarantees high profits.
Factor in Property Management
As a landlord, you want to maintain low vacancy rates by keeping your property in appealing conditions. With this in mind, create an effective real estate property management plan that enables you to stay up-to-date with inspections and maintenance. Remember, besides fixing structural issues, it’s your duty as a landlord to deal with other concerns, such as pest issues. Therefore, familiarize yourself with landlord’s pest management guidelines in Toronto to ensure your properties are safe. Typically, property owners must ensure rental units are clean by removing rubbish, inspecting properties regularly, and spraying non-toxic pesticides.
Understand Total Cost of Property Ownership
Many aspiring real estate investors think the purchase price is the only cost factor to consider when buying investment property. However, the total cost of property ownership entails monthly costs, such as mortgage costs, insurance fees, and property management fees. In most cases, utility costs are the tenant’s responsibility, so it’s important to highlight this in the lease contract. If you’re investing in commercial real estate, decide if utility bills, insurance fees, and maintenance are your responsibility or the renter’s obligation.
The real estate market in Toronto is hot, making it a perfect ground for investors looking to grow their portfolio. However, to establish a successful property business, you need to determine your investment goals. It’s also important to plan for property management and understand the total cost of owning properties.