You’ve heard things about the GTA rental market and you want in.
Over the years, we’ve helped countless folks purchase their first income properties as a way of helping them realize their financial goals; whether it be related to education, retirement, travel or otherwise. So, yes — we think income properties make great options, especially in today’s booming condominium market.
Alas, not all condos are created equal. To help you start thinking about what makes a great contemporary, high-income property, we’ve compiled a list of some factors you’ll definitely want to take into consideration when searching.
Here they are:
Proximity to Employment Districts
Nobody wants to spend their precious off hours stuck in traffic, so it should be no surprise that finding a home close to their workplace is often high on a tenants list when looking to rent. Find an income property with an edge by choosing one in a neighbourhood close to high-density employment stretches.
It’s for this reason that we love condominiums in and around Toronto’s Financial District like The United BLDG, but there are lots of other neighbourhoods that fit this criteria too. Areas around Hospital Row and the Yonge and Sheppard intersection are good examples of recession-proof income properties, as well as regions where major commercial growth is in the works like Vaughan and Markham.
Coming Soon: CentreCourt’s TC4 & TC5 in Vaughan will occupy a location next to world-class employers, KPMG, PwC, YMCA, BMO, TD Canada Trust, Miller Thompson LLC, Harley Davidson, BUCA, Marc Anthony and GFL Environmental.
Public Transit Access
Modern renters prefer to commute and run errands using public transit — capitalize on this by considering properties with optimal transit options. Buildings within walking distance of the subway are obviously great for this, but you should also be looking toward the future. New transit lines are being built across the GTA, including the Hurontario LRT and the Eglinton Crosstown, so make sure you keep these incoming routes in mind.
Coming Soon: Line 5 South Condos will be next to the new Eglinton Crosstown LRT, but will also be just steps to the Eglinton Subway Station.
Hot Tip: Plug the address of the building you’re considering into Walkscore, this is a tool that provides ratings out of 100 based on access to amenities and public transportation.
Choose Your Suite Size Wisely
One-bedroom layouts often make excellent income properties -- especially near commercial or office-heavy areas where single professionals are looking. Although, don’t discount larger two or three-bedroom units either. Couples and growing families are increasingly making up more of the condominium demographic, so naturally, they’re looking for family-sized spaces. Since many buildings have neglected to incorporate these kinds of units, having one can give you an advantage -- especially in a neighbourhood near schools, community centres and other family-friendly amenities.
Coming Soon: The New Lawrence Heights Towns offer a list of suite layouts that come with a standard of 3 and 4 bedrooms with the option to convert layouts into a 5 bedroom plan.
Think About the Lifestyle The Building Offers
The kind of building in which you buy dictates the kind of tenants you’ll be attracting. While it may seem tempting to find the least expensive unit in a building with minimal amenities when you’re starting out, think about what kind of tenants would want to occupy that space. If you’d like your pick of high-end professional residents, you’ll want a place that reflects their lifestyle. That may mean sleek and uncommon amenities like the expansive Megaclub at King’s Landing 2 and King's Landing 3 South Tower which will feature a bowling alley, tennis court, and basketball court, or the salt-water infinity pools at M3 Condos.
It might mean opting for a project with a majestic waterfront view like Lakeside Lake Suites or the Bjarke-Ingles-designed King Toronto Condos in King West. While snagging the most opulent, luxurious suite in the city’s most expensive building may not the most advisable move either. Remember that old “never buy the biggest house on the block” rule? It applies in condos too. After all, how many tenants are in the market for a 5,000-square-foot penthouse with a private elevator? Regardless, it pays to think about the details that will give your rental listing an edge.
What’s the Going Rental Rate? Is the Area on the Verge of Improvement?
This sounds obvious, but it pays to do your homework and scope out the going rental rates for similar buildings in similar neighbourhoods. If you’re working with a competent agent, they can provide you with details like this, but you can do it yourself by using popular rental sites or REALTOR.ca. Also look for future developments in the area that might encourage dramatic increases in the near future, like new infrastructure, retail developments, streetscape improvements or more luxury buildings. We saw this with the Yonge and Eglinton neighbourhood, where a formerly sleepy stretch on the edge of the city rapidly became one of the most popular uptown destinations (with rental prices to match) after a boom of modern buildings went up, a retail renovation launched -- and an LRT was proposed.
Jobs, transit, suite size, amenities and current rental rates. Got all that?
While the idea of purchasing a pre-construction condominium unit for income purposes is an exciting prospect, it pays to put some strategy into where and what you’re buying. By following these guidelines and getting insight from your Platinum Broker, you’ll have a better chance of finding a property that meets both your needs and those of your tenant.