Real estate is one of the fastest growing commodities in Canada. Over the past decade, property values have benefited from steady increases across most of the country; and even though the market in London, Ontario has been known to fluctuate, there are still many good reasons to invest in real estate. Regardless of the market, real estate in Canada has increased more than 10% since the early 2000s; which, compared to other investments such as stocks and bonds is a significantly better return on investment. And in London, Ontario, there are also a large number of desirable properties that make excellent investments.
One of the most common investment properties in London is the fixer-upper. Investors can enjoy incredible profits when they purchase rundown properties at a discount price and sell for a considerably higher price once improvements to the home and yard are made. Indeed, investors can make even more when they endeavour to make the repairs themselves. Not only can you save on labour costs by upgrading a dilapidated property yourself, but you can also make repairs as you can afford them. Alternatively, many investors hire professional contractors to manage renovations, and though this is a more costly option, it is also more likely that repairs will be made in a timely fashion. Either way, the cost of repairs has a direct impact on the value of the home, and in most cases this increase in value exceeds the cost of the property and the repairs combined. Fortunately, there are a number of attractive fixer-uppers throughout London, and smart purchases have a considerable upside.
Western University is one of the largest universities in Canada, and with it comes a large student population. As such, London, Ontario is an excellent locale for profiting from student rentals. Whether you purchase a home, condo, or apartment building you can often make significant income from renting to students. Sometimes you can rent a multi-bedroom unit to more than one student thereby increasing your investment income. One tip is to furnish your student rentals. Though the start-up costs are somewhat higher with furnished rentals, you can also charge more for rent.
Buy and Hold Investments
Finally, buy and hold investments are becoming increasingly popular. With this strategy, real estate investors purchase ready-to-rent properties that require little to no repair to make them marketable. With a buy and hold investment, your return is spread over time and the goal is to sell when the property has appreciated in value. In the meantime, you can either live in the home or rent it out at a rate equal to or greater than the value of the loan. You’ll still have the responsibility of maintaining the London home, but collecting monthly rent allows you to offset your costs while you wait for the property to appreciate.
As you can see, there are many effective investment strategies that make London, Ontario a desirable real estate market. From fixer-uppers and student rentals to traditional buy and hold investment strategies, the market in London is ripe for investment.