Long before the birth of the formal stock market, there was a time when salt was as valuable as gold. This was the time when we were not using fossil fuel as oil. The most sought after asset at that point of time was land. Over the period of centuries, real estate investing has evolved significantly. Today, investors put their money in real estate to diversify and enhance their income.
Back in 2016, the real estate market of greater Toronto and greater Vancouver was in a bubble. This was because governments were imposing taxes and making mortgage rules more complicated. They were doing it to slow down the housing market and it worked positively for them. In 2018, the national average sales dropped up to 11%.
This is the reason why most of us want to know whether they should invest in pre constructioncondos or not.
Treat real estate as a business
For many people, investing in real estate is like purchasing a primary residence. Your invested time, research investigation to analyze the purchase deal will help you find a good investment property.
Manage the risks
pre construction condos are a wonderful way to increase your passive income and diversify your portfolio. As it happens with every business, so does the real estate investment is not free from risks.
You need to keep an eye on your debt ratio; this will help you get the best loan rates. You need to check your credit score and try to keep it in good health. Nowadays, with the help of credit agencies, you can check your credit score at any point of time. Make sure to pay your bills on time and have a word with your advisor before you apply for a new loan.
Costly repairs and maintenance
You are investing in a rental property to enhance your cash flow. You need to make a contingency fund at the time of investing. This will help you get the cash flow positive property. You need to anticipate monthly expenses in advance; this includes repair fund and other maintenance costs also.
Before renting your property, it is imperative on your part to screen tenants carefully and create a detailed release. Take the help of a real estate lawyer to create a lease for you. Make sure you are aware of all the local laws that apply to property owners and tenants. Make sure you add insurance cover to safeguard your property from any kind of damage.