Investing in Guelph real estate can sometimes be a tricky proposition depending on your real estate investment goals. The good news is that Guelph is a hot spot for investment. Many local investors in Guelph buy what is called “student rentals.” Students will generally pay between $550-$750 per room, often times with utilities extra. There are many types of Guelph real estate investments and certainly more options than student rentals so please read the following article to get familiar with other popular Guelph real estate investments.
Student Rentals
The student rental market starts in January and Lasts until March. The smarter investors purchase early with a closing date arranged for April 30. They use the time in between the acceptance of the purchase offer and the closing date to find tenants (or use a property manager to do it for them). You can find tenants quite easily, especially in January as this is when the smart students begin looking so that they find the best homes. We often get calls as early as November from University of Guelph students trying to secure the best properties before everyone else. We maintain a list of students who have inquired about renting, and can package these groups with your purchase. We even involve them in the property search, and secure a conditional lease to coincide with your purchase offer. You can then rest assured that your investment will be rented with no hassles or worry.
If you are worried about finding tenants and maintaining the property, leave it to our team. We will find them for you. After that expect to pay about one month’s rent, per lease usually taken from the initial deposit when the lease is signed. Our hand picked team are reputable property managers from Property Link Management Services, who’s sole business is looking after investment properties. Leave it to the professionals to take the guess work out of investing. Give them a call to see if they have a solution for you.
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Pre-Consruction
The Guelph, Cambridge and Waterloo Regions are bustling with growth. The excellent infrastructure, multiple universities and colleges, along with the proximately to the Greater Toronto Area, make investing in this area a wise decision. Many investors are gobbling up pre-construction home, townhomes and condos and a record pace. Many builders are not working with public buyers through a sales office or a Realtor and are going direct to trusted database of ready investors.
The best way to beat this trend is to join it! Although we may not get paid in some cases, we can certainly give you a head start through our local knowledge and relationships. What we get out of it is a long term relationship that will bring referrals and an eventual sale when you sell. Reach out to get on our list for ore-construction projects in this area.
Rent-to-Own Investments
You may have heard of rent-to-own properties. Although not many local investors are saavy with this kind of investment, there are certainly many advantages. The way it works for an investor is this; we find buyers who want to purchase a home but do not have the credit to do so today. We work with a debit consultant who works out a plan to correct their credit situation, once a plan has been established, we determine what they will be able to afford in 2-3 years. Our team then finds a home for them, and YOU the investor buy it. The tenant (future buyer) gives you a non-refundable deposit somewhere between 2.5-5% of the purchase price and agrees to pay you rent of which a portion is retained for their eventual downpayment. The agreement to purchase is already signed for a value usually between 4-6% higher (per year) than the current purchase price.
The advantage if this kind of investment, is a guaranteed market appreciation and a purchase contract, in addition to a large, up front deposit that is non fundable. The worst situation is, should the potential buyers back out of the deal, they will leave you with with a property to sell. The deposit and collected extra rent, however, is yours to keep.
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Family Homes And Accessory Apartments
Family homes with two units or more are an affordable and a relatively safe investment. The current vacancy rate in Guelph according CMHC is 1.2%, which is one of the lowest in the country. A solid investment in this category is a renovated bungalow with a legal accessory apartment. The main floor of a three bedroom bungalow in Guelph will rent for about $2500 per month. A two bedroom basement apartment will rent for $1700. The total rent excluding expenses will gross $4200 Considering that you could easily pick up a property like this between $650,000 and $850,000. With today’s low interest rates your mortgage will be approximately $2500 per month. Adding property tax, and insurance you could still cash flow at over $1000 per month. Having a positive cash flow, is getting very difficult to find in other markets. Combine this with strong market growth rates, you have yourself a winning investment.
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Multi-Res Apartment Investments
Apartment complexes are also a popular investment and many will start to become available as people start to retire. These types of properties are not for everyone but typically provide higher net income returns. These type of Guelph real estate investments also involve a large upfront investment (35% of the purchase price). Investors often join resources to purchase these type of investments to help absorb some of the initial outlay of cash. We also have access to private lenders who will lend money to investors. Call us for a list of properties not advertised to the public.
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Guelph continues to be a hot spot for real estate investment. This year (2016) the annual gains are around 10%! Where are people buying? Should you buy there too, or are there other upcoming areas and investment vehicles?
Prices are up and so in rent. Recently, we have a consistent rent of $600 per room NOT including utilities. This makes many homes great investment opportunities. Don’t want for others to figure this out too.