Buying a condominium as an investment strategy is not as simple as most people are led to believe.  It’s not rocket science either. However, it does require some level of analysis, research and due diligence. We can help you with making the critical ‘go’ or ‘no-go’ investment decision with our special Condo Investment Return on Equity (RoE) Report.

Benefits investing in condominiums as an investment strategy:

1. Condos generally appreciate in value at a rate which is almost consistently higher than the inflation rate.  Real Estate does not however go up by an average per year, but it does go up on average.

2. It is relatively easy in many major Canadian cities to find an occupant for a condo apartment primarily due to the constant influx of new immigrants and foreign students.

3. There is an increasing demand among the populace for the condominium lifestyle and the luxury and convenience that comes with living in a condominium complex.

4. Due to the minimal amount of upkeep involved, the economic benefits of owning a condo are more attractive for the first-time investor.

5. There is the available option to the investor to appoint the condominium corporation or a professional management company to take care of management and maintenance issues, thereby eliminating time/resources required for tenant management.

6. Facilities such as tennis courts and swimming pools are maintained by the condominium corporation. This frees the new investor from the responsibilities of upkeep.

7. Taxation benefits – If you invest in a condominium rental property, you can deduct many of your personal management expenses from income, in addition to the normal tax deductions such as mortgage, interest, depreciation, and other condo-related expenses. For instance, you would normally be entitled to set up a small office in your current residence for managing your investments, which would include keeping your records. You could deduct a percentage of all your home-related expenses. The normal formula is to take the square footage of the office area that you are using relative to the total square footage in your home. In general terms, 10% to 15% or more is usually deducted for that portion.

8. The owner is protected by the bylaws and the rules and regulations set by provincial condo legislation, by the original project documents, and by the bylaws and rules and regulations. For example, many condominiums do not allow pets in the building because of the potential wear and tear on the apartment. This type of rule protects and benefits the investor.

In addition, you would be entitled to deduct a part of the car-related expenses involved in managing your investment portfolio, whether it is one rental property or more than one. The percentage of all your car-related expenses can vary, obviously depending on the usage of the car relating to your investment.

Investor Tip:
If you are looking for higher appreciation (resale value) for your condo investment, buying the least expensive unit in a luxury condominium/townhouse complex generally offers a more financially attractive return than the purchase of the largest unit in a modestly priced development, assuming the price is the same.

Premier Matrix Realty’s Special Condo Investment Return on Equity (RoE) Report:

Our custom report helps our clients figure out whether their investment will give them the desired return.  Our RoE analysis report is not supposed to help predict your profit on sale because future sale price is an unknown. We are more keen to address the rentability of your condominium investment; and the amount of down payment that will be required to make the investment feasible.

One must remember that, generally speaking, rents have very little variation from one area of Toronto to another. Therefore, it is important to quantify that amount of down payment required in any particular condominium project and the price being paid.

Our analysis report will help you understand whether the condominium you are considering is worth the investment. Simply enter the information required and let us show you whether your condominium is a good investment.

CLICK HERE to respond to our questionnaire.

Important: If you are contemplating investing in condominiums as an investment strategy, it is important to seek competent tax and accounting  advice from a qualified professional, and legal advice from a lawyer specializing in condominium law.