When Investing in Real Estate, Follow the “Smart” Money
Written by Shane Little
Bay Street Bull’s real estate columnist Shane Little, talks about why, despite misconceptions, Toronto’s real estate market is still ripe for the picking.
Don’t be put off by interest rates and regulation
With a recent increase in mortgage interest rates, coupled with high tax rates for foreign buyers and even tighter rules for potential landlords, most believe that what once went up for Toronto's housing market, can only go down.
While many suggest this spells the end for the once blazing market, Long-term investing is still a slam dunk given Toronto's reputation as a world class city.
The argument that the above changes are affecting first-time buyers (some say they’re put off by regulation or the rate increases) is pretty much a myth. Smart first-time buyers are buying now—smart investors are buying now, and buying often. They understand that Toronto has changed, and it’s changing for the better. The new reality is that it’s an attractive city on the global stage, with a stable government, high quality of living (ranked number two in North America in the Mercer Rankings) and is culturally more relevant than it’s ever been.
Toronto as a major tech hub
Nobody understands this better than the companies that are leading the push for Toronto’s establishment as a major tech hub. Whether you’re picking stocks, betting on sports, or investing in real estate, it’s generally a good rule of thumb to follow what the big players are doing.
The big names currently betting on Toronto’s long-term future include General Motors, Thompson Reuters, Alphabet (Google’s parent company), and most recently Amazon. Toronto is the only Canadian city that “made the playoffs,” as John Tory said, for Amazon’s newest headquarters. It accomplished this without offering any tax breaks or incentives, as many of the other finalists have. Canada’s expedited visa program for skilled immigrant workers means that it can attract a diverse pool of talent from around the globe, unlike our neighbours to the south.
Smart city, smart money
Not to be outdone, the "Quayside" project announced by Google on 12 acres on Toronto's waterfront being advertised as "the world's first neighbourhood, built from the internet up," is cause for increased optimism. Still having the space, drive, and ability to draw such visionaries, clearly shows how well-viewed the our city really is.
In short, "follow the smart money." Government intervention and mortgage lending environments are only minor turbulences while the the Toronto housing market grows. Great immigration policies and innovative growth mean Toronto will have leaders heading here in droves, now, and for the future.