There are so many different ways to answer this question, that there really is no one correct answer. But, there are defiantly certain characteristics to look for when you are trying to find an investment property and some of them will be discussed below.
Location – Location – Location
A highly astute and very profitable real estate investor was once asked, what are the three things that he looks for in a property before he buys it? He answer was, “location, location, and location.” He said whenever he finds a piece of property that meets those requirements he is more than happy to take out a Toronto mortgage.
Now that you know that, you have to be asking yourself exactly what is a good location? Once again, there a ton of different ways to answer that question, and we will do our best to provide you a few examples.
If you are purchasing a house that you want to keep rented in order to have the tenant payoff your mortgage, you should look for a stable neighborhood that has a very strong school district. Not only are these types of homes very easy to rent, they usually appreciate significantly overtime.
Certain investors are willing to take more risks in order to get a high ROI in a short period of time. For these types of people, a good location would be a rundown neighborhood that is starting to improve. In most instances, a piece of property that meets this profile will be very inexpensive to purchase and can be sold for a large profit after it is renovated.
Another type of location that you should consider is a new development. When properties like this are first put on the market, the sellers usually heavily discount the houses for the first few months in order to make sure that have enough buyers to recover their initial investment.
After they have sold enough homes, they then start increasing their prices and the first people that bought homes in the new community will experience sharp increases in their properties value very quickly.
Another good location to look for investment properties are well establishment neighborhoods where it is possible to find homes that have not been refurbished. In these types of areas, many residents will have spent a great deal of money updating their homes which increases all of the surrounding properties value.
However, there will always be some homes in communities like this that have not been painted in twenty years. When you find a property like this, you can go in and paint the place, put in new flooring and maybe even a new kitchen, and quickly flip it for a good profit.
The examples mentioned above are just a few of the types of locations that intelligent real estate investors are always checking out. With Toronto mortgage rates as low as they are now, it is a good time to get into the real estate market and begin profiting when you find a property in a great location.