Still buying rentals?

I'm looking, if deal that make sense comes up I will buy and I came across couple close ones.

I'm keeping track of price movement in some areas. Will look aggressively in early spring. No pre-cons or assignments. I'm part of a group and we may buy up to 10 units.

I sold everything during pandemic. Not because I predicated this but various circumstances. Only having PR and sitting on cash I am looking for a rental duplex or triplex or maybe a future retirement condo I'd rent out now.
Prices are also certainly headed lower but the right deal now could still be worthwhile. I don't understand those that are leveraged to the hilt and still on the hunt for the 4th property. The risk vs reward doesn't seem to to be there. If you are sitting on a few mil in equity or less and you have a pension the upside is really minimal and ending up back where you started even if a 20% chance doesn't seem worth it. But granted some might have more expensive aspirations or future lifestyle.

Not condo rentals that's for certain.

I have a couple of pretty serious buyers but mostly for detached with conversion potential next to major transit stations as per Bill 23.

Also recently saw a 7 plex in the core sell for dirt cheap, we missed it by a bit, had some tenant risk.

For anyone not scared of renos there are some decent opportunities well below market imo but they go quick and you need capital, usually not the easiest to finance in some cases.

RichmondCA wrote: ↑ Not condo rentals that's for certain.

I have done calculations for quite a few condos with 20%, with the current rates many of them are not only cashflow negative but also loosing money every month. Pretty much only end users are buying right now.

senasena wrote: ↑ I have done calculations for quite a few condos with 20%, with the current rates many of them are not only cashflow negative but also loosing money every month. Pretty much only end users are buying right now.

Isn't the rent to purchase gap even bigger with housing in many areas of GTA?

I do understand why numbers dont make sense on Condo, just thought the same for housing (ignoring the long run play of the land value and possibly renovate to multiplex on sfh lot ect).

I guess thats the reason housing still looks ok for investing / renting?"

The one area I feel like that makes sense as an outsider (never been a landlord, just follow the market a bit) is the near border home rentals. Cost for a home in fort eerie area is super cheap compared to GTA, yet rent vacanacy and market rental rate is better than gta suburbs that sell for 2-2.5x the house cost. Border demand for rent from nursing and the like has skyrocketed and stayed strong since covid started.

senasena wrote: ↑ I have done calculations for quite a few condos with 20%, with the current rates many of them are not only cashflow negative but also loosing money every month. Pretty much only end users are buying right now.

Try to do same calculation for houses, those are even more money losers in gta unless you find some hidden gem stone that can be salvaged with right tools or some multi residential units re.

RichmondCA wrote: ↑ Not condo rentals that's for certain.

I have a couple of pretty serious buyers but mostly for detached with conversion potential next to major transit stations as per Bill 23.

Also recently saw a 7 plex in the core sell for dirt cheap, we missed it by a bit, had some tenant risk.

For anyone not scared of renos there are some decent opportunities well below market imo but they go quick and you need capital, usually not the easiest to finance in some cases.

Why no to condos?

Seeknfind wrote: ↑ Why no to condos?

Condos in good location with current rents and demand and future immigration is better choice right now, houses in burbs would need to drop another 20% to make sense as rentals.

ilim wrote: ↑ Condos in good location with current rents and demand and future immigration is better choice right now, houses in burbs would need to drop another 20% to make sense as rentals.

yeah, it really is area specific in comparing the two.

go look at what a rental costs on the prime toronto detatched houses. the ratio of rental payment to monthly carrying costs is so much worse for those than condos.

brampton houses rent for 3k and sell for over 1mil. you can get 2500 rent in a condo for a 550-600k sale price.

same with uptown, 2.5mil + houses rent for 6k and that range...

krn905 wrote: ↑ yeah, it really is area specific in comparing the two.

go look at what a rental costs on the prime toronto detatched houses. the ratio of rental payment to monthly carrying costs is so much worse for those than condos.

brampton houses rent for 3k and sell for over 1mil. you can get 2500 rent in a condo for a 550-600k sale price.

same with uptown, 2.5mil + houses rent for 6k and that range...

Agree, I was looking and still am (more like the getaway place for myself) in suburbs and the ratio is worse, and then thinking about that I would need to commute there and maintain the outside and inside of the house put me off completely from buying a house in the burbs for rental.

Downtown or yonge-sheppard/finch condos will probably have decent cashflow if it drops a bit more. Detached houses in the suburbs as rentals is pure speculation.

Sfhs are rife with risks, on a relative basis. I'm wary of ending up with tenants who turn the basement into grow ops So, I'm sticking with condos.

Just took a random look, this condo at yonge/finch sold for 600k 3 days ago. 2+1 bed, 2 bath, 1 parking spot could go for 2.9-3k~ in that area. Would be cash flow neutral including maintenance fee and taxes if you put around 35% down.

https://housesigma.com/web/en/house/dXz ... 3-C5831604

DisneyKruze wrote: ↑ Sfhs are rife with risks, on a relative basis. I'm wary of ending up with tenants who turn the basement into grow ops So, I'm sticking with condos.

Lol I was going to say, alot more can go wrong repair wise and good luck chasing renters for that damages money

Also, renters turning a rental into a rooming house is increasingly common (or airbnbing it). Your almost forced to do it yourself otherwise you just miss on the profit and take the extra risk.

Shitty state due to lax enforcement of regulations.

senasena wrote: ↑ I have done calculations for quite a few condos with 20%, with the current rates many of them are not only cashflow negative but also loosing money every month. Pretty much only end users are buying right now.

For houses it's even worse.

A $2m house in Toronto will rent for like $4k.

And people will say yea but they aren't making anymore land.

Yea that's why you paid $2m for it, you already paid a premium for that.

I'm willing to bet someone who bought 4 $500k condos and rented them out for $10k per month will come out way ahead.

teoconca wrote: ↑ Yep, rents for 2 condos (1+1) are more than rent for 1 house. Condos can be sold separately if needed.

It's also easier and faster to start and scale.

A lot of people waiting many years to buy a house could have built up a lot of equity if they were buying condos the last 10 years for $300k.