When is a good time to buy multi-unit residential properties? Anytime the fundamentals are good.
Several factors must be considered. A carefully completed due diligence check list is a must before proceeding.
First, a growing city will be ideal for possible future capital gains and income growth potential. The city or town you choose to invest in should have overwhelming evidence of growth and overall low vacancy rates (see CMHC free rental survey reports available online). In a perfect world, you will discover the location before competition drives prices up.
Second, a structurally sound building in good repair will provide a dependable cash flow and a growing positive return. Thirdly your financing can make it all happen or not. Vendor take-backs are not uncommon and can be a great way to make a purchase for those entering this investment arena. Now manage diligently! If you would rather not manage your self, hire a professional property management team.
What cities or towns may be worth a closer look?
If you move early you can grow and prosper as the community’s plan becomes a reality. You could be in place as prices begin to rapidly rise and the general investing public and investment clubs begin to react to the strong fundamentals and low prices compared to the cities already on the radar screen.
What cities would you choose? What about…
- St John, New Brunswick (oil refinery, tidal power),
- Sudbury Ontario (mining – huge reinvestment in the older mining properties and infrastructure),
- Hamilton Ontario (dynamic city redefining it self with investment in the water front),
- Kitchener – Waterloo, Ontario (highly educated workforce),
- Windsor, Ontario, (a city that is also seeing the importance of diversity and is working hard to invest in its future; residential vacancy rates are low, many good properties to choose from at excellent prices, you can grow here, location, location especially important with this riskier city).
Lastly, you may find the best properties, possibly diamonds in the rough, in your own neighbour hood town or city.
In our area, Orillia, Ontario has been chosen (by the Real Estate Investment Network), along with Barrie, as their pick for the top ten Best Places to invest for potential capital gains growth.
So, keep your eyes open and your house in order so you can move on a deal when it presents itself. Any town and city can have multiple opportunities, especially during these more turbulent times.