5 Key Factors to Check whether your Investment in Condo is a Sound Decision
Condominiums present a unique opportunity for property investment, whether fresh off the market or previously owned. For investors interested in purchasing condos, their purchasing criteria may differ from those investing in commercial or multi-unit residential properties.
When determining whether a condo property investment is financially viable, there are five key factors that should be taken into account. These factors can aid in calculating the financial implications of making the purchase.
It never gets old – Location is still King!
The age-old saying location, location, location has proven to be timeless for a good reason. Your condominium’s location and the nearby neighborhoods and facilities can be the determining factor between a top-notch purchase and a mediocre one.
When you invest in a condo, the neighborhood around it can make all the difference in creating a sense of community. It is crucial to choose an area that already has the necessary facilities and resources to support the needs of tenants. The availability of public transportation and high walkability scores are significant factors that can greatly increase the attractiveness of a specific neighborhood.
When looking into areas to live, it’s useful to look into the local BIA groups and social media outlets such as neighbourhood blogs and Facebook pages.
Get the Best Price
It’s common knowledge, yet surprising to note that even experienced real estate investors can succumb to the allure of an emotionally-driven purchase and overpay. To ensure that you obtain the most reasonable and optimal price for your new property, gather accurate information on pricing trends of similar units in your desired locality.
Comparing different developments is made easy with our powerful comparison tool, which enables you to view properties simultaneously and assess key factors including price per square foot, available amenities, maintenance fees, and deposit structures.
Be aware of Numbers.
It is fundamental to be acquainted with your financial figures besides acquiring the finest purchase price. It is necessary to obtain information about several significant numbers including the property’s rate, its probable reselling value, potential rental income, maintenance or condominium association fees, property taxes, parking situation, current utility conditions (if offered), and any other related fees when investing in a condo.
It is important to have clarity on what your condo fees entail. This includes understanding whether the fees cover all amenities or some require extra payment. Additionally, it is crucial to determine whether the fees also cover property taxes and utilities, and to what extent. Obtaining this information can be done by consulting with the development office of a newly-built condo or a nearby real estate agent.
Compute Your Figures – Understand the Return on Investment (ROI)
Before investing in a Toronto condominium, whether it is a new or pre-owned one, it is crucial to evaluate its finances thoroughly. This involves assessing rental occupancy rates realistically and performing number crunching exercises outlined above. By doing so, investors can confidently determine if the condo property aligns with their portfolio and business objectives.
Getting a thorough grasp of intricate details is possible by utilizing an ROI tool, like the one provided on this website.
Contemplate the Proficiency of Condominium Developers
The emergence of a hot real estate market usually brings forth an unfortunate consequence of numerous condo developers, regardless of their skills and ability, joining the construction race. In this regard, the wisdom and proficiency of an adept developer will always prevail.
An inexperienced developer of condominiums might come up with a building that has inadequate design or layout, lacks the anticipated amenities or quality finishes desired by potential purchasers, faces a shortage or complete depletion of funding, or is generally a chaotic disaster from beginning to end.
To make sure that the condominium developer you plan on purchasing from is capable of completing the project to your satisfaction and meeting your requirements, it is important to conduct thorough research about their background and reputation.