Why Invest in Real Estate?
Owning an investment property allows you to accumulate wealth as its value grows over the years—and generate rental income in the meantime. Here are just a few of the benefits of this simple strategy.
- Predictable Growth – The value of homes in Hamilton-Burlington tends to grow year after year, and at reasonably predictable rates.
- Optimal Performance – Buying and holding real estate outperforms most other wealth-accumulation strategies.
- Tax Advantages – As an investment, real estate offers a solid tax deferment and avoidance strategy.
- Great Timing – Low interest rates and increasing rents in Hamilton-Burlington make now a great time to invest in the area!
- The Power of Leverage – Real estate allows buyers to achieve higher returns by leveraging borrowed money when they invest.
Investment Property Types
Each type of investment property comes with its pros and cons. Knowing what they are will allow you to make the purchase decision that’s right for you.
- Condominiums – Due to their attractive price points, low maintenance requirements, and appealing amenities, condos can be a great investment. Be aware that investors must pay monthly fees and share some liability with other condo owners.
- Freehold Properties – Benefits of investing in freehold properties include attractive appreciation rates and higher liquidity than other property types. Investors should know that freehold properties represent just one income stream, and you’ll see a 100 percent profit loss when they’re vacant.
- Multi-Unit Properties – Higher cash flow is a prime benefit of investing in multi-unit properties, along with centralized costs for multiple tenants (economy of scale) and reduced risk of income loss during vacancies. Compared to other property types, be prepared for more damage from tenants and lower price appreciation.
How to Get Started
- Weigh Your Options – Work with a real estate agent who has investment expertise to learn about the potential strategies available to you.
- Set Your Criteria – Create your investment goals and decide on the budget, property type, and ideal neighbourhood to help you achieve them.
- Secure Financing – Learn about your borrowing options (including the benefits of re-advanceable mortgages).
- Develop a Plan – Along with your agent, create a long-term plan that’s focused on cash flow—then start looking at opportunities.
Ready To Invest?
Ready to start investing in Hamilton-Burlington real estate? The Woolcott Team is ready to answer your questions, provide sound advice, and help you begin your investment journey!