Navigating the Toronto real estate market can feel overwhelming. From finding trustworthy advice to making smart investment decisions, there’s a lot to consider. Where do you even start? This post breaks down key insights on building wealth through real estate, how to spot reliable agent reviews, and where the Toronto housing market is headed.
Real Estate Agent Insights: Honesty and Advice
Finding Honest Real Estate Agent Reviews
Online reviews can be a minefield. How do you know if they’re genuine? Many platforms don’t verify reviews, leaving room for bias or even outright fabrication. So, where can you find real, unbiased opinions?
Rank My Agent: This platform stands out because it pulls directly from Realtor.ca. Because of this direct connection, it offers a higher level of confidence. Realtors themselves use it for referrals, trusting its reliability. If an agent has a solid track record with 10 or more reviews there, that’s a good sign.
The Power of Negative Reviews: Believe it or not, the worst reviews can be the most helpful. Why? They reveal what went wrong. Everyone can have a great experience sometimes, but how does an agent handle challenges? Look for patterns. Are the complaints reasonable, or do they seem like one-off situations? Sometimes, you’ll spot an unfair or irrational review, but often, you’ll gain valuable insight.
What to Look For: When reading negative reviews, consider:
- The client’s concerns: What exactly are they unhappy about?
- The agent’s response: Did they address the issue professionally?
- Overall tone: Is the review measured and factual, or overly emotional?
Reviews are there for a reason. They can really help you make a well-informed decision when you’re picking your agent.
Building Wealth: The Advisor Mindset
It might sound strange, but a good real estate agent shouldn’t just be trying to sell you something. Instead, think of them as a wealth-building advisor. There’s a big difference. Salespeople focus on immediate transactions, while advisors prioritize your long-term financial well-being.
The Regret of Selling: Many people who sell properties later regret it. Real estate tends to appreciate over time, so holding onto it can be a smart move. The goal is to create a situation where you don’t have to sell.
The Path to Financial Freedom: How do you get there? For many, residual income from real estate is the answer. Unlike a job, where you trade time for money, real estate can generate income even when you’re not actively working. It’s like building a business, but with tangible assets.
The First Property Trap: A common mistake is selling your first property after just a year or two. You buy, you enjoy it, then you decide to sell. Instead, plan to rent it out from the start. After your first year, start planning for your next purchase. How can you save for the down payment? What equity can you pull out of your current property?
The Keep-and-Rent Strategy:
- Buy your first property: Enjoy it for a year!
- Plan to rent it out: Start saving for your next down payment.
- Buy your next property: Keep the first one as a rental.
- Repeat: Build a portfolio of income-generating assets.
Ideally, your rental properties should break even or, even better, generate positive cash flow.
Barbara Cochran’s Story: Consider the story of Barbara Cochran, who wanted to buy her first New York apartment for $85,000. She backed out, and it took her seven years to get back into a position to buy. By then, the market had outpaced her savings. That initial apartment would have been worth far more than the deposit she lost!
The Future of Toronto Real Estate: More Rentals?
Affordability Crisis and Housing Solutions
What will housing look like for the next generation? In 25-30 years, how much will a typical house in Toronto cost? It’s a scary thought. With prices rising faster than people can save, homeownership is becoming increasingly challenging.
Will we see more houses turned into rentals? More properties being split up into smaller units? It’s already happening. Neighbourhoods that once featured single-family homes are now filled with multiplexes and rooming houses.
The Yellow Belt Initiative: Toronto is trying to address this with initiatives like “disposing of the yellow belt.” What does that mean? On city maps, yellow zones are designated for single-family homes. Traditionally, you couldn’t have more than one unit in these areas. Now, that’s changing.
The Rise of Multiplexes: Expect to see more garden suites, basement apartments, and conversions of existing homes into multi-unit dwellings. Why? Because a $7-10 million detached home is simply unaffordable for most people without additional income.
Investment Strategies and Portfolio Diversification
If you had $5 million to invest, how would you allocate it?
Multiplexes vs. Condos: Would you buy two multiplexes (3-4 units each) or six condos? There’s no single right answer.
- Multiplexes: Offer more control and potential for appreciation.
- Condos: Provide diversification but come with condo fees and shared decision-making.
Many people would recommend a mix of both. Owning investment properties means setting aside money for repairs anyway.
Personal Preference: Some people don’t like owning in a building with other owners. You’re not in charge of all the decisions, and other owners can impact the building’s reputation. Others believe there’s more appreciation potential in the detached space.
The Mixed-Use Advantage: Consider investing in mixed-use properties (residential and commercial). Commercial leases often have no LTB (Landlord and Tenant Board) involvement. Of course, commercial properties also come with their own risks, such as changes in consumer demand.
The Trifecta for Real Estate Investment:
- Strong Exit: Look for properties in the path of development.
- Major Corridors: Focus on locations along major streets.
- Mixed Use: Combine residential and commercial units.
Importance of Professional Guidance: Don’t hire an inexperienced agent for complex transactions. Work with someone who truly understands income-producing assets. There’s a point where commercial real estate becomes a different animal, so know when to bring in a specialist.
Key Takeaways
The Toronto real estate market is constantly evolving. To succeed, you need to:
- Find trustworthy advice from experienced professionals.
- Focus on building long-term wealth, not just making quick sales.
- Understand the changing landscape of housing and investment opportunities.
Ready to take the next step? Seek out a qualified real estate advisor who can help you navigate the market and achieve your financial goals. Get in touch with the Halyard Group today!
