Introduction
Once in a while, we have investors coming to us exploring whether Toronto is worth investing in!
Toronto’s our favourite city to invest in but it is harder to prove to you that returns are better if you’re looking at turnkey investment properties that can be rented out on day one.
You could probably hit similar rent yields no matter where you are in Ontario, and it’s tough to speculate on future appreciation – even though Toronto historically has outperformed.
So technically, the expected ROI isn’t as outstanding in Toronto. And if you’re working with limited capital, Toronto is realistically a tougher market to get into.
But if you’ve got more money to invest with and an appetite to take on bigger projects, Toronto is where the magic happens.
Better Value-Add In Toronto Compared To The Rest Of Ontario
Say you upgrade a single-family home into 3 units in Toronto. That can bump rents from $4,000 to $6,700 a month. And if we value this project based on cap rates, that can translate to a $650,000 increase in value.
For a similar project elsewhere in Ontario, you might get a $2,000 bump in rents and that would translate to a $480,000 increase in value.
Construction costs are more or less the same regardless of where you are in Ontario, say around $200,000. So, taking on a project in Toronto could mean a much better value add lift for a half year project like this.
Waived Development Charges In Toronto For Event Better Returns
Toronto’s development charges are waived for 4 units, so if you compare these savings to other cities that might be charging $50,000 in DCs per unit, that can actually make a big difference in lift too.
Once you factor this in, the investment capital gap between Toronto and other areas isn’t really big anymore.
How We Can Help
We’ve got some exciting opportunities in Toronto that could seriously boost your investment value.
If you want more details, just go to this link below to chat with us. We’re ready to show you the projects with max value add potential!
