Investing in Pre-Construction Condos
Canada has one of the strongest condominium markets, and with immigration estimated to remain active over the next 10 to 15 years, the Canadian market is expected to continue to be an ideal place for real estate investors. With so many construction and reconstruction projects coming out all the time, the Canadian condo market can be overwhelming for both newcomers and seasoned property investors alike.
Provincial and territorial law generally regulates condominiums in Canada, while the minute details vary according to jurisdiction. You are required to follow the legal details of your jurisdiction to ensure you make profitable investments without facing legal issues. Here is a list of important points that you should consider when investing in Pre-Construction Condos.
Invest in areas that are gentrifying
When investing in pre-construction condominiums, it is strongly recommended to purchase real estate in the areas that are gentrifying, that is the areas that are in the process of development, and migrants have just started moving in.
Build relationships
Like any other business, relationships work a lot in the condominium market. You should have links with the agents who can inform you about a profitable project before it is marketed and goes public. Always try to be among the first to invest in a project of your interest.
Purchase small units
When buying for investment purposes, it is recommended to always buy small units. Remember it’s better to buy two 500 sq. ft. units than to invest in one 1000 sq. ft. unit. It is easy to sell or rent out smaller units as compared to larger ones, and the former are also less vulnerable to market fluctuations.
Buy in the mid to low end of the market
Always purchase property in the mid to low end of the market. If you will buy at the high end, there is a possibility that there may be a downturn in the market when your project gets completed. Whereas buying in the mid of the market, you will be in a position to sustain any sort of market shift.
Invest in something that is unique
Most of the condominiums available in the market are built on a template, each one like the other. End users are usually interested in unique units, so invest in buildings that offer different designs.
Avoid investing in huge buildings
From a real estate perspective, it is always profitable to sell your property to an end user rather than a real estate investor. But the end users are mostly interested in small buildings, which they can transform according to their needs.
