Investment Properties 101

Knowing what property to acquire remains one of the more difficult decisions for any investor. The good landlord looks at the financial numbers and tries to make decisions based on facts, and attempts to keep emotions in check.

The common way to evaluate different investment properties is through comparing CAP rates. CAP rates are determined by factoring all of the investment’s expenses (but not finance) and calculate that against the projected revenue. Too often, property management, repairs, maintenance and vacancy expenses are left out in determining a proper CAP figure.

But CAP shouldn’t tell the whole story in evaluating properties. An in-depth analysis should consider projected appreciation which will lead to a superior return on investment (ROI). Suppose you are offered two investment opportunities. One is located in Windsor Ont. and offers a true CAP rate of 8 per cent and another in Toronto that offers a CAP of less than 6 per cent. If CAP is the only component to consider, it is a no brainer. You buy the Windsor property.

Foreign Investment In Canada: Should We Care?

A third of people buying homes in Canada may be foreigners, says one real estate company. A leading economist says the number isn’t even 5%. The country’s housing agency says it has no idea what the actual number is.

Even at Canada Mortgage and Housing Corp., the percentage of foreign ownership in the Canadian housing market is a deep mystery. CMHC avoided the issue entirely this month, when it released a massive survey of more than 42,000 Canadian condominium households in Vancouver and Toronto.There is no definitive answer to the persistent question about how much of the current Canadian housing boom is being driven by overseas buyers — as some eyes focus sharply on Mainland China.

“At this point in time, it is still very difficult to identify [overseas investors] as part of the survey,” said Bruno Duhamel, manager of economic and housing analysis at CMHC. “We are exploring what type of method could be used.”


Meet Our Team

Maison Valley consists of Mase Dhirani and Sam Valimohamed, two top-producing RE/MAX Ultimate agents, who specialize in the various aspects of both residential and commercial real estate including selling properties, acquiring for buyers, investments & property management.

Sales Representative, RE/MAX Ultimate
Sales Representative, RE/MAX Ultimate