Real Estate

Chatham Real Estate

  • Last Updated:
  • Nov 4th, 2019 7:15 pm
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[OP]
Member
Jan 28, 2010
305 posts
43 upvotes
Montreal

Chatham Real Estate

Hello RFD,
I have been looking to buy my first house/townhouse/condo and have been looking into various cities. Given that I dont want to put a huge sum at once, rather wanted to go step by step , I have quite a limited budget to start with. With that, GTA and nearby cities are not very feasible. I have been looking into Windsor/Chatham/London areas and found some houses in Chatham area that would be good for me as first time home buyer.

I wanted to get your opinion if it is wise idea to invest in real estate in Chatham?

I don't expect crazy appreciation , but I'm looking for some rental income as well to sell it in near future (3-5 years) with some profit margin.
1- do you think house in Chatham can be sold with some profit margin in next 3 years? or you think the resale of old house would be very hard in those cities? I'm looking for a 3 bedroom house for about 230K-250K range.
2- Would it be easy to find tenants in those cities or I would have vacant house for most of the time?
3- is it overall good idea to put money in houses which are of range 230-250K?

your opinion would be very much appreciated!
14 replies
Deal Addict
Sep 12, 2007
2638 posts
862 upvotes
I'm curious what real estate agents will say, if anything.
I am not an agent, but having lived in all 3 places, if I had to invest I would in this order.

1.London
2.Chatham
3.Windsor
Member
Jun 10, 2008
467 posts
334 upvotes
Halton Hills
I bought a small 2 bed bungalow in Chatham just over a year ago. Paid $95,000 and rents for $950. Cash flow positive with zero down. Appreciation of course is slow. I wouldn't spend too much on a place as rents top out lower than the GTA.
[OP]
Member
Jan 28, 2010
305 posts
43 upvotes
Montreal
thisischris wrote: I bought a small 2 bed bungalow in Chatham just over a year ago. Paid $95,000 and rents for $950. Cash flow positive with zero down. Appreciation of course is slow. I wouldn't spend too much on a place as rents top out lower than the GTA.
Thanks for reply. how do you see the resale value of houses in that range?
do you mind sharing the rough area where you have that house?
Member
Jun 10, 2008
467 posts
334 upvotes
Halton Hills
CanadaDealSeeker wrote: Thanks for reply. how do you see the resale value of houses in that range?
do you mind sharing the rough area where you have that house?

Hey, my place is on Park Lane. The prices seem to be ramping up. After 1 year I would expect to get minimum $110k. An increase or 15k. Mind you my place is a 900sqft bungalow without a basement. It's selling feature is an oversized detached workshop.

The property taxes are low there. Mine are $1700/year. The vacancy rate is super low. I advertised on kijiji and after 5 days had like 600 views, 40 replies, 10 good candidates and a top 5 to choose from. I had it rented before I took possesion... actually my tenant picked up the keys from the agent for me.

If you live near by you should deffinately start monitoring the market and purchase. I want to get another one but in chicken because I live 2.5 hours away. If I get another one it would be a 3 bedroom around $200,000. It won't meet the 1% rule but it would be newer and more sellable in the future.
Newbie
Aug 13, 2019
22 posts
62 upvotes
thisischris wrote: Hey, my place is on Park Lane. The prices seem to be ramping up. After 1 year I would expect to get minimum $110k. An increase or 15k. Mind you my place is a 900sqft bungalow without a basement. It's selling feature is an oversized detached workshop.

The property taxes are low there. Mine are $1700/year. The vacancy rate is super low. I advertised on kijiji and after 5 days had like 600 views, 40 replies, 10 good candidates and a top 5 to choose from. I had it rented before I took possesion... actually my tenant picked up the keys from the agent for me.

If you live near by you should deffinately start monitoring the market and purchase. I want to get another one but in chicken because I live 2.5 hours away. If I get another one it would be a 3 bedroom around $200,000. It won't meet the 1% rule but it would be newer and more sellable in the future.
Appreciate the detail. How did you manage to get it rented before taking possession? Did they rent based on photos only?
Banned
Jun 4, 2018
90 posts
45 upvotes
Toronto
I've invested heavily in some commercial properties in Chatham in the past. 1 was a pig, did phenomenal. The other made a bit of money, nothing great.
Overall the town doesn't have much going for it. The population is decreasing and there isn't much activity.

I would avoid it like the plague. You need areas where the population is increasing. Look at Hamilton and Kitchener.
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Member
Jun 10, 2008
467 posts
334 upvotes
Halton Hills
brmst1 wrote: Appreciate the detail. How did you manage to get it rented before taking possession? Did they rent based on photos only?
I schedule my top potential tenants to see the place during my home inspection. I asked my agent to make sure this was ok with the previous owner.
Deal Addict
Mar 10, 2011
2307 posts
420 upvotes
Toronto
Chatham residential property price appreciation is very poor. People can own a property there for 10 years and after selling expenses ie RE agent, moving etc, there can be zero positive appreciation.
There has been some recent activity with retirees buying properties there to retire, but it is not really a growing area for commercial/ industrial business. If you are looking for price appreciation, i would look at other options.
Member
Jun 1, 2019
209 posts
250 upvotes
Here in Niagara we had the highest rate of appreciation in Canada in the past 5 years according to https://creastats.crea.ca/en-US/

25% higher appreciation than Toronto, for example, and striking distance from Toronto.

Prices are still reasonable, and population growth continues. Rental market is reasonable as well.... for example, I just did a real estate deal in Thorold (near Brock U) where my buyer will live in a 2 bedroom portion, and rent a 4-bedroom portion out to either single family ($1300/month roughly) or 4 students ($1600/month roughly). He paid mid-$400's. Do the math, factor in likely continued strong appreciation, he wins all the way around.
Full Service Realtor
Niagara / Hamilton-Burlington
Member
Jun 10, 2008
467 posts
334 upvotes
Halton Hills
I agree with the above posters. Appreciation is slow in Chatham. However, if you're looking cash flow now it is very appealing. Also you don't need a lot of money to purchase there. Break even is difficult to achieve around the GTA.

I couldn't afford to buy an $650,000 townhouse in the GTA and be out of pocket each month. But I could deffinately afford a $100,000 Chatham detached and positively cash flow. So for a small time investor like me it made sense.
[OP]
Member
Jan 28, 2010
305 posts
43 upvotes
Montreal
Thanks everyone for their opinion, and i definitely agree that appreciation is not the goal if you go into areas like Chatham. As @thisischris mentioned, it is more of an opportunity for small time investors who want to get some cash flow and dont necessarily want to put a huge sum.
[OP]
Member
Jan 28, 2010
305 posts
43 upvotes
Montreal
thisischris wrote: Hey, my place is on Park Lane. The prices seem to be ramping up. After 1 year I would expect to get minimum $110k. An increase or 15k. Mind you my place is a 900sqft bungalow without a basement. It's selling feature is an oversized detached workshop.

The property taxes are low there. Mine are $1700/year. The vacancy rate is super low. I advertised on kijiji and after 5 days had like 600 views, 40 replies, 10 good candidates and a top 5 to choose from. I had it rented before I took possesion... actually my tenant picked up the keys from the agent for me.

If you live near by you should deffinately start monitoring the market and purchase. I want to get another one but in chicken because I live 2.5 hours away. If I get another one it would be a 3 bedroom around $200,000. It won't meet the 1% rule but it would be newer and more sellable in the future.
Thanks man for details , really appreciate it. Also, very happy for you for the property you bought and met the 1% rule.
I have been monitoring the market but seems very hard to get something with 1% rule, and also the houses at 100-120k range are very old looking so I'm really concerned if it would be really hard to sell out in future., as you definitely dont put it for life. you would need to get out at some point when you find better opportunity elsewhere.
Member
Jun 10, 2008
467 posts
334 upvotes
Halton Hills
CanadaDealSeeker wrote: Thanks man for details , really appreciate it. Also, very happy for you for the property you bought and met the 1% rule.
I have been monitoring the market but seems very hard to get something with 1% rule, and also the houses at 100-120k range are very old looking so I'm really concerned if it would be really hard to sell out in future., as you definitely dont put it for life. you would need to get out at some point when you find better opportunity elsewhere.
Not probs. The prices have gone up since I bought it. A year ago there were many small detached homes in rentable condition for $80-100k. Now there are very few. Similar homes are now $110k+. I figured if that place pays for itself and flows money each month, I'm not worried about it depreciating since I was zero out of pocket from the start.

A couple of tricks I used; monitor rentals on kijiji. Check how many views per day an ad gets to have an idea of how many tenants are looking.

Message "wanted" ads and ask their budget and location. I was able to get some info about specific houses form tenants who are familiar with the area.

Use this calculate as a quick tool https://www.calculator.net/rental-prope ... lator.html

Look at surrounding areas. I've been watching Blenheim. Wallaceberg is good but too far for me. I see a lot of people looking to rent in Ridgetown.

Remember that rent will top out quick. Nobody there will pay $1700/month- they can own for that much.

Remember a lot of people there are on OW or ODSP. I look for homes targeting retired couples. Ie. Small 2 bedroom bungalow with a garage/workshop.
[OP]
Member
Jan 28, 2010
305 posts
43 upvotes
Montreal
thisischris wrote: Not probs. The prices have gone up since I bought it. A year ago there were many small detached homes in rentable condition for $80-100k. Now there are very few. Similar homes are now $110k+. I figured if that place pays for itself and flows money each month, I'm not worried about it depreciating since I was zero out of pocket from the start.

A couple of tricks I used; monitor rentals on kijiji. Check how many views per day an ad gets to have an idea of how many tenants are looking.

Message "wanted" ads and ask their budget and location. I was able to get some info about specific houses form tenants who are familiar with the area.

Use this calculate as a quick tool https://www.calculator.net/rental-prope ... lator.html

Look at surrounding areas. I've been watching Blenheim. Wallaceberg is good but too far for me. I see a lot of people looking to rent in Ridgetown.

Remember that rent will top out quick. Nobody there will pay $1700/month- they can own for that much.

Remember a lot of people there are on OW or ODSP. I look for homes targeting retired couples. Ie. Small 2 bedroom bungalow with a garage/workshop.
very useful information. Thanks a lot for the details, really appreciate it.

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