Investing in Toronto real estate can be a great way to diversify your portfolio and build a steady source of passive income. But before you take the plunge, it’s important to consider the pros and cons of buying an investment condo.
The PRos of an Investment Condo
In Toronto, condos are typically cheaper than traditional homes. Investors can maximize the return on investment when purchasing cheaper property.
Condos also require less maintenance than other properties because they come with shared amenities like pools, gyms, and parking garages. This means that you won’t have to worry about mowing the lawn or shovelling snow off the driveway. It is an added bonus if you don’t have much free time on your hands.
In addition, the lack of property boundaries leads to decreased disputes between tenants and neighbours regarding easements and rights of way.
The Cons of an Investment Condo
The most obvious downside of investing in a condo is that you’re subject to monthly maintenance fees. These fees can vary from building to building, but they typically include regular maintenance fees as well as special assessments for unexpected repairs or upgrades.
Additionally, some associations might impose strict rules regarding who is allowed to live in the building and what type of activities are allowed onsite (e.g., no pets or excessive noise). The ability to attract a quality tenant can be deterred by these seemingly arbitrary rules.
Finally, should a tenant default on rental payments, the monthly obligation of mortgage payments and property taxes remains. However, with a condo, the maintenance fees add an additional stressor, as failure to pay could cause a lien to be registered.
Investing in a condo has its pros and cons similar to any other type of real estate investment. It’s important to carefully weigh both sides before making a decision so that you can make sure it is right for you and your particular situation.
Ultimately, if done correctly, owning an investment condo could be highly lucrative…but only if you do your due diligence!