Here’a A Top Toronto Investment Deal We’ve Been Eyeing This Week!

Semi-Detached 4-Unit Conversion
Bloor West
Laneway Suite Potential
Actual returns may vary depending on assumptions.  Read our definitions and assumptions.

How Do You Make Money On An Investment Property?

There are four ways to make money with an investment property:

Principal Paydown

A part of every mortgage payment goes towards paying down your loan principal (so you owe less to the bank and own more of the investment property). 

It’s like part of your rental income from your investment property goes into a forced savings plan that adds up over time, and this part boosts your total investment property returns.

Cash Flows

Cash flow is the extra money you might get each month you get after paying all the property bills and the mortgage.

We like to be smart about it, aiming for at least breaking even (net zero cash flows), so we don’t have to worry about covering monthly property payments (negative cash flows). The more money you make from your investment property, the better your cash flows can be, which can mean better overall real estate investment returns too.

This is the main deal for some real estate investors – those looking for financial freedom and a break from the 9-5 grind often work towards getting big cash flows from their rental properties.

Their goal? To have these real estate investments bring in enough income to eventually replace their day job pay.

Long-Term Appreciation

Over time, real estate tends to appreciate, despite short-term ups and downs.

In Toronto, entering the investment property market can be pricier, typically requiring a minimum of $250,000 of investment capital for a house (for a 20% downpayment and closing costs). 

But if real estate investors can afford this, many are drawn to Toronto due to its strong and stable appreciation, averaging around 7% per year over the past two decades.

 

This consistent growth makes Toronto’s real estate means better returns and lower risk when you want to cash out and take profit.

Toronto Market Appreciation vs. Major Canadian Cities

 

While good rental income is always important, experienced real estate investors often prioritize better appreciation potential. 

Why? When selling, only half of the capital gains are taxed, offering a better tax structure. And when you don’t want to sell your investment property, you can access the gains through mortgage refinancing without facing substantial transaction fees or paying taxes.

What's Happening In Toronto's Real Estate Market?

Want to know what’s been going on in Toronto’s real estate scene lately? Curious about where the market is heading? Our expert insights have you covered!

Value-Add Gain

Adding value to your investment property through renovations is called value-add gain, and it can be quite rewarding. 

But here’s the thing – it’s not for everyone. It takes time, effort, and renovation risk. 

The amount of value-add gain you get depends on the renovations you choose (aim for maximum return), the people you hire, and how well the project is managed (which gets better with experience).

What Toronto Real Estate Investment Is Right For You?​

Check out our complete Toronto real estate investment guide for all the details and real-life examples. If you’re ready to dive in, just book a call with us!

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