In 2011 I started a passion project. My investment condo experience was something to pour my heart and soul into and a way to feed my love of real estate. It was time to invest in a second piece of real estate, and this time in the condo market in downtown Toronto.
Just like all other real estate investments, this isn’t something you should take lightly. For whatever reason you’re purchasing a second property– solely an investment property, a second home for the family like a cottage, an office, or rental space – that needs to play into the type of space, location, size, and the list goes on.
So, in 2011 when I started looking I had my criteria clear in my head: central downtown location, close to TTC, 1+ bedroom, and we would use it as a rental property… maybe not forever but for the time being. Of course like any real estate investment, money was a guiding factor in what we were able to afford but I was able to use the equity from our first home as the down payment. We ended up buying a pre-build that would be ready for occupancy in 2015, which also allowed us to make deposits instead of one large down payment.
We rented it out fairly quickly, starting August 2015, just one month after occupation. Our tenants were wonderful and respected the property during their entire stay. To keep in the know and to have a say in what was happening at the property I decided to join the Board of Directors, and was appointed Secretary. After our monthly meetings, I dreaded the thought of driving home and even guiltily wished our tenants weren’t in our unit. I started to wonder, “when could we start enjoying our condo?”
In August 2017 my tenants left, marking a new beginning and more importantly, led me to reflect on what I had learned so far with my investment condo experience and if I would have done anything differently if I were to buy today.
- Parking: Didn’t purchase a parking spot, so we ended up renting
- View: North facing, doesn’t have the greatest exposure, east or south would have a more scenic view
- Bedrooms: Unit is a one + den, should have gone for a two bedroom
- Location: Prime, only a 500m walk to the Davisville subway station on the Yonge line, wouldn’t change this for a thing!
So, like many big purchases, you can see that there are a few things I wish I had considered at the time of buying. I wish the unit had another bedroom, had a better view and a parking spot. These are all big rental and selling factors for condos. I was fearful of taking that extra risk at the time but know that it would have been so worth it now! It certainly would have been more affordable then compared to if I were to upgrade now.
While I would do things differently with my investment condo experience, it’s hardly all-bad. We’ve built about $100,000 in equity in a few short years. I’m back to using the space myself as an office in the city. We’ve been able to re-paint and furnish it entirely and one day we might venture into the furnished rental market. I’m glad I used the equity for the down payment from my primary residence to invest. You can’t find a better neighbourhood and it got my foot in the Toronto market. The property has given us a huge return and has so many benefits, I can’t imagine not having it!
Have you been toying with the idea of a second property? Remember, it’s always a good time to invest! Don’t wait to buy real estate. Buy real estate and wait.
To learn more about how to prepare for the financial side of owning an investment property be sure to check back in next month!