Month: July 2020

When you’re looking for a new place to live, one of the first questions you’re likely to ask yourself is “Should I buy or rent?” There are plenty of things to consider from the cost of housing to the market where you’d like to live.

There’s a case to be made for both sides, but ultimately there’s a decision that makes the most sense for you. Here’s everything you need to know about buying a condo vs renting an apartment.

1. Know Your Market

Where you’re currently living or planning to move to can have a big effect on whether it’s more financially sound to buy or rent. It’s important to do your research on the local real estate market.

Is your desired location a buyer’s market or a seller’s market? That depends on the supply and demand for housing in the area.

In a buyer’s market, the supply of houses will exceed the demand for them. That means there will be less competition among buyers and you’ll have more standing to negotiate.

If you’re currently in a buyer’s market, it can make sense to take advantage of that opportunity and purchase a property. Markets can change over time, so if you’re in a seller’s market, it could be a good time to rent and wait for the demand to decrease.

You should check to see how rent prices in your city have changed over time. It’s also crucial to look at how similar properties have appreciated over time. That can help you learn if you’ll make a profit when selling your condo down the line.

2. Consider Your Future Plans

Is it the right time to buy a condo? That can depend on your current stage of life and what your plans are for the future. If you’re planning to stay in your current city long-term and put down roots, then owning a condo could be the right decision.

Owning a condo provides stability. Unlike with an apartment, you don’t have to worry about 12-month leases or the possibility of your landlord selling the building you’re in. That also means avoiding the cost of moving between apartments.

That stability can be an appealing option for potential buyers in all stages of life. For young people interested in purchasing their first place to live, condos can give them a taste of ownership without the size, cost, and upkeep buying a larger house can entail.

Owning a condo can also be great for people looking to downsize during retirement or when kids leave for college. There’s typically less maintenance involved with condos, so they can be a low-key, low-stress route when it comes to homeownership.

On the other hand, if you’re planning to move in a few years or don’t feel ready to commit to a certain neighbourhood, renting can be the better choice. Renting an apartment gives you more flexibility.

You’re not tied down to a particular property if you discover something about it that doesn’t jive with your lifestyle. You also have the option of choosing month-to-month rent if you know you’ll only be someplace short term.

3. What Buying a Condo vs Renting an Apartment Means for Your Equity

One of the biggest advantages of buying a home or condo is that you’re able to build equity. If you’re staying somewhere long-term, then buying a condo becomes an important and valuable investment.

Equity is considered an asset and it’s also part of your net worth. This can help down the line if you’re hoping to qualify for a line of credit or a home equity loan.

4. Think About the Costs of Buying

When you’re thinking about buying a condo vs renting an apartment, you have to consider the costs associated with owning a property.

Condos come with condo fees for things like utilities, maintenance, and upkeep for any community spaces. If you’re planning to buy a condo, then you should remember to factor things like maintenance fees into your budget.

Fortunately, these fees mean less for you to worry about when it comes to things like garbage removal, exterior maintenance, and snow removal during the winter months.

Condos also provide owners with the freedom to make updates to their homes, from repainting walls to changing light fixtures. While this is a great way to express your style, it can also create expenses that wouldn’t factor into renting an apartment.

Fortunately, condos tend to be smaller than homes and usually require minimal upkeep. This can make them a great first home purchase for anyone looking to adjust to the idea of homeownership.

Another cost to consider is the initial down payment needed to purchase a condo. Whether you’re putting down 5 percent or 20 percent, it requires a big chunk of money.

If that’s not currently possible for you, then renting can be a more affordable option while you save up to purchase a home.

5. Enjoy a Built-In Community

When it comes to buying a condo vs renting an apartment, both options can provide a built-in community. This can be great when you’re moving to a new city or new neighbourhood because you’ll be close to your neighbours.

Condos also typically offer amenities, from common areas to swimming pools to hobby rooms. These spaces can be a great way to get to know people who live nearby and who share similar interests.

Condos also tend to be closer to the city than the suburbs, giving buyers more of a chance to get out, do things, and meet people.

Rent or Buy?

When it comes to buying a condo vs renting an apartment, there are plenty of pros and cons to both. Ultimately, it comes down to your lifestyle and what you’re looking for.

If that’s something more flexible, then an apartment can be the right route. But if you’re looking to put down roots and making a good investment, then buying a condo could be the best option for you.

For more tips on purchasing a property, please contact us today.

Are thinking about investing in a condominium in Toronto? Not sure if it’s even worth it?

Well, you’re in the right place. Not only do we know the answer to the question of “Is buying a condo worth it?”, but we know about hidden expenses and other important elements of a condo sale that you need to know about.

In this article, we will cover all that and even more.

So if that sounds interesting to you, keep reading to find out more.

Assessing the Investment Opportunity

Is buying a condo worth it? Well, that’s for you to decide. If you treat the opportunity as an investment, it most certainly is, but only if done right. Assessing the property individual is critical to determining its worth.

The most important consideration is cash flow. In premise, the cash flow is the revenue that you might generate from the condo, minus any expenses. If you get more than enough to cover the costs, such as taxes, fees, maintenance—your cash flow is positive (and that’s a good thing).

If a condo cannot have a positive cash flow that does not automatically constitute it as a bad investment, but knowing the difference will ensure that you make an educated decision.

Begin by assessing the potential revenue that you can receive from rent. Many factors will play into this. For instance, you can examine comparable rent in nearby buildings of the neighbourhood, and link it to a ration with the amenities and features that the unit offers, plus any condo fees.

You must also determine the expenses. Starting with regular costs that occur at expected intervals, you should factor in events that might come up irregularly. For instance, a special assessment is levied when a repair cannot be covered by the reserve fund of the condo board.

If you plan to buy the property with cash, you can determine the rate of return of the opportunity by assessing the capitalization rate. In order to calculate it, you need to divide the net operating income (revenue from property – operating expenses) by the purchase price.

In general, the higher the cap rate the better. If you get a number of 4% or above, that’s great. However, the cap rate will not present your return in a realist manner if you go with mortgage financing. In this case, you can examine the return on investment, which will take the financing into account.

Also, if you can be flexible on the neighbourhood in Toronto, that means you might be able to score some better deals. The average condo price in Toronto is continually rising, therefore the demand for sale condos under $550,000 is increasing.

Is Buying A Condo Worth It? It Is, As Long As You Address the Expenses

As mentioned earlier, quantifiable metrics can help you determine the worth of a condo purchase. Intuition is not the greatest way to go about investments. So here are some expenses that you have to consider for all Toronto condo purchases.

The Deposit

When you research information on condo costs in Toronto, it’s important to understand that you need to have deposit funds readily available. When it comes to Toronto condos for sale, typically the deposit is at least 5% of the entire purchase price, and that goes towards the down payment.

If you are buying a $500,000 condo, the deposit has to be $25,000, and it’s usually completed 24 hours after an offer has been accepted or with an offer that was in competition for the property.

The minimum down payment that you can make depends on the purchase price of the condo as well, however, if the payment is less than 20%, you will be required to pay CMHC mortgage insurance to consolidate any issues that might arise in the future.

Land Transfer Tax

The Land Transfer Tax will be charged to any person who is buying real estate. In the city of Toronto, you pay a provincial and municipal LTT. The entire amount that is owed will entirely depend on the total purchase price of the property.

For instance, when buying a condo for $500,000, you will pay $12,950 in LTT, spread equally $6,475 for provincial and $6,475 for municipal. If you are a first-time buyer, you can apply for an LTT Rebate. On a $500,000 condo, that will save you $8,475.

Title Insurance & Lawyers

At closing, these costs are typically lumped in unison. The cost to have a property title change ranges from $250 to $500.

Most real estate attorneys will include the fee itself in their fee, so it’s a good idea to budget at least $2,000 in legal fees to cover your association for the time of sale.

Property Tax Adjustment

Not often has the seller already pay the property taxes beyond the closing date, but it can happen. If they have, the buyer has to reimburse the seller for the difference.

But it can be negated via communication and lawyer negotiation, but the question is whether or not you want to complicate the process.

Hidden Expenses

So is buying a condo worth it? Yes and no. Consider these hidden expenses as well when making your calculations.

You will likely need to hire movers. This can cost upwards of $1,000, depending on the number of items and other factors.

You might have to work with a locksmith. Utilities have to be set up, such as the internet, TV, and other things you think will be advantageous to a renter.

Elevators have to be booked with a refundable deposit. Cleaning services can become a regular aspect of your rental process.

The furniture itself will cost money as well. And possible repairs in the future that are not covered by the building will eat into the finalized price approximations.

Beyond mortgage payments, you will have to cover monthly carrying costs, such as condo fees, property tax for the current year, and property insurance.

Without being mathematical about the process, you are just guessing your way into an investment, and that’s when you can’t really tell if it’s worth it or not. True worth is quantifiable, so determine what it means for a condo investment to be worth it, and see if an opportunity fits your requirements.

Buy A Condo

Now that you know the answer to the question of “Is buying a condo worth it?”, you are well on your way to deciding for yourself.

It can be hard to find properties to invest in, but we make it easy for you. We find the best possible residences that are certainly worth your time and money, so if that sounds interesting to you, get in touch with us and we will happily accommodate your needs.

Did you know that the average price for a home in Toronto is $1,000,000?

If you’re on the hunt to sell your home fast, you may be wondering what the best ways to find a buyer are. Advertising your home for sale on social media can be an effective way to find a buyer quickly.

That’s why today, we’ve created this quick guide with tips for advertising your home for sale on social media. Keep reading to learn more!

1. Consider Using Videos for 3D Tours

You can reach a huge audience of potential buyers in your local area by using videos to offer 3D tours. As COVID-19 continues to spread across the globe, it’s very difficult for prospective buyers to stop by your home for an in-person tour.

Using a video recording allows buyers to virtually walk for your home and the property without ever having to leave the comfort of their home. While you may have to invest in a videographer if you don’t have the technology readily available, this added expense can help draw in tons of potential buyers.

2. Invest in Facebook Ads

Facebook ads are one of the best ways to sell your home with the power of social media. By creating a professional Facebook profile, you can increase your reach with Facebook ads.

By setting a daily budget of how much you like to spend on your advertisement, you can narrow down the demographics of the people viewing the ad. You can choose to advertise to specific buyers by targeting your ad to people of a specific gender, interest, location, age, and even hobbies.

This will allow you to truly customize what audience is you and your Facebook ads so that you can sell your home quickly without having to spend a lot on Facebook ads.

3. Pinterest Is a Handy Tool

Pinterest is often a tool that many social media experts often forget about. This social media platform allows people to view images and create boards to organize all of the pictures that they save.

Each image on this social media application links back to a website. Pinterest is very popular or longbows who are interested in travel, beauty, and interior design.

You can use Pinterest ads in a similar fashion to Facebook ads, by creating a targeted campaign to show to those that are interested in interior design on Pinterest.

Home for Sale: Tips for Success

When you put up your home for sale, using social media to advertise your home will help to quickly get your house in front of the eyes of potential buyers. By not using social media to advertise your home’s sale, you’re missing out on a large marketplace to potentially sell your home to.

Are you looking for a local real estate professional that’ll help you to quickly sell your home? Click here to contact us today to learn more!