Key Considerations When Purchasing Investment Properties in Etobicoke
Real estate investing can be a very profitable way to generate a positive cash flow while your real estate appreciates in value. In order to make the most of your real estate buying dollar you have to find areas where there is a considerable demand for rental properties, like the GTA. While the downtown core of the GTA may be very expensive to purchase property, you could consider an outlying area like Etobicoke which also has a considerable amount of demand for rental units.
When reviewing the various condos that are available, you need to factor in a host of variables including the maintenance costs. These maintenance costs should include hiring the best condo window cleaners in Etobicoke, Ontario to clean the windows on your condo.
Importance of Cash Flor Projections
A key thing to consider when trying to find a suitable investment property is the costs linked to operating the property, you never want to be in a situation where you are breakeven or in a negative cash flow position. To mitigate these risks you should find out which service providers the condominium like the aforementioned condo window cleaners in Etobicoke, Ontario. Reviewing the costs associated with these services and whether they are providing the best possible value is something that all condo boards perform on an annual basis.
Along with the maintenance fees associated with the condo which you are required to pay even if you are not able to find a tenant for your unit is property insurance. Your tenant can purchase his/her own renter’s insurance but you should invest in good quality insurance to protect you in the event there is substantial damage done to the property either by the tenant or some other hazard i.e. busted water pipe. By having this insurance in place, you will have added protection in the event you get a bad tenant or have faulty plumbing.
Ensuring Your Unit is Fully Occupied
To reach an occupancy rate of 100% which can be attained requires some research on your end. Once you have worked out the expenses associated with the condo and adding your desired profit margin, you need to compare what similar condos are renting for in Etobicoke. You need to establish an average asking price per square foot so you can price your condo somewhere in the middle of the pack. If you price it too low then you are not getting the full benefit from your investment while on the flipside, if you price your rent too high then the pool of potential tenants would be greatly reduced.
Something to bear in mind while renting out your condominium that while you are receiving rent every month, the property is also going to appreciate in value. This appreciation will really help you when you decide to sell the unit in the future for a profit.
If you follow these suggestions of keeping your costs down and keeping your occupancy rates high, you should be able to make a very well-informed investing decision.