How does the Orillia Beaches compare to the Toronto Beaches?
Orillia is ranked 3rd best in Ontario for best places to invest in by the Real Estate Investment Network (REIN).
Toronto is ranked 8th best in Ontario for best places to invest in by REIN.
Statistics from CREA:
Average residential house prices in Orillia
2006: $226045
2007: $241517
2008: $242891
2009: $236776
2010: $252758
Average residential house prices in:
Leslieville/Riverdale
2006: $375000
2007: $409000
2008: $443000
2009: $458000
2010: $485000
The Beach/Danforth
2006: $458000
2007: $494000
2008: $519000
2009: $539000
2010: $611000
East York
2006: $317000
2007: $356000
2008: $368000
2009: $375000
2010: $409000
Toronto
2006: $351000
2007: $376000
2008: $379000
2009: $395000
2010: $431000
Appreciation wise`the Toronto Beaches has grown significantly more than Orillia over the last 4 years (percentage wise). They both provide good cash flowing opportunities. They are both Economically Strong and both have beautiful beaches and tourism attractions near the lake. You need deeper pockets for the Toronto Beaches.
Which city would you prefer to invest in? I personally prefer the Toronto Beaches because of the diversity it offers in terms of rents and real estate values. You can literally convert a $750 / month 1 bedroom apartment into a $1500 / month executive suite with cosmetic renovations. And the premium tenants are willing to pay for a premium suite. Gotta love the Toronto Beaches!
[quote user=AndreiAngelkovski]the Toronto Beaches has grown significantly more than Orillia over the last 4 years (percentage wise). They both provide good cash flowing opportunities.
Toronto beaches as it is in GTA .. which will always be more desirable .. close to big city yet small town feel ! GTA will always attract new immigrants & money and as such will always be a great place to invest and live !!
ALWAYS !!
Orillia is a small town .. always has been .. always will be !
The way things are going today, with every second home owner renting out there basement, will home owners be renting out each bedroom to be able to make mortgage payments. Is there not the potential of these upscale neighbourhoods developing into rooming house slums.
Realistically is a $600,000 home a viable investment as a rental property or is it a monthly money pit waiting to be sold to realise potential appreciation.
I thought REIN was about investing in income properties, benefiting from positive cash flow and principal paydown to grow investment portfolios, and appreciation was intended as gravy.
Is it not wiser to have two $300,000 properties that are self sustaining and appreciating at 40% than one $600000 with a potential of negative cash flow appreciating at 80%.
It seems like those area's have appreciated well since 2006.
How representative are those numbers of actual appreciation percent for the same house?
Ie did a East York house appreciate 29% from 2006 to 2010? Or:
Were there more sales of higher priced homes as a portion of sales?
More new construction containing average sales higher than average pricing of pre-existing housing in area?
Indicative on some level of changing of area - ie older properties being renovated and a portion of those numbers are distorted from Rustic Charmer with wall paper and knob and tub going to marble floors and gold leaf mouldings?
Any insight into how these factors played out in those area's you have listed?
Rarely brought up - some great neigbourhoods have gone downhill in past... and focus of investors is normally to look at upside only....
Are today's larger homes in urban area's tomorrow chopped up multiplex's?
[quote user=invst4profit]But will rental rates be able to keep pace.
The way things are going today, with every second home owner renting out there basement, will home owners be renting out each bedroom to be able to make mortgage payments. Is there not the potential of these upscale neighbourhoods developing into rooming house slums.
It seems like those area's have appreciated well since 2006.
How representative are those numbers of actual appreciation percent for the same house?
Ie did a East York house appreciate 29% from 2006 to 2010? Or:
Were there more sales of higher priced homes as a portion of sales?
More new construction containing average sales higher than average pricing of pre-existing housing in area?
Indicative on some level of changing of area - ie older properties being renovated and a portion of those numbers are distorted from Rustic Charmer with wall paper and knob and tub going to marble floors and gold leaf mouldings?
Any insight into how these factors played out in those area's you have listed?
Thanks
ADAM
Hey Adam,
Good question...
There have definitely been renovations happening in these areas which helps the values go up on average, but at the same time I have been investing in this area for the last 7 years and I remember I submitted an offer on a Triplex in 2005 for $365,000 in East York and this year it was relisted at close to $600,000. It was not renovated, BUT the rents increased about $150 - $200 / unit more.
[quote user=invst4profit]I thought REIN was about investing in income properties, benefiting from positive cash flow and principal paydown to grow investment portfolios, and appreciation was intended as gravy.
You are absolutely correct! REIN speaks about Cash Flow FIRST and appreciation as gravy.
Just because a triplex is worth $600,000 in the Toronto Beaches doesn't mean that it doesn't cash flow positively. In fact, there are several duplexes, triplexes, and 4 plexes that cash flow very well in the Toronto Beaches and that cost anywhere from $500,000 - $800,000 plus. It's a matter of understanding the supply and demand, the tenant profiles, rental demand, what quality tenants are willing to pay for quality suites. You'd be surprised to see what kind of rents people are willing to pay to live in these areas, especially being so close to the financial district.
Yes you do need deep pockets to invest in Toronto, but ultimately I agree with what Thomas Beyer said about the Toronto Beach Market in the next 10 years! And that to me is very tasty gravy
[quote user=AndreiAngelkovski]appreciation as gravy.
Don't invest in an area where you expect little equity upside.
Cash-flow alone is usually poor in residential real estate. Yes you can make money by paying down a mortgage ... but the combination of cash-flow, mortgage paydown AND value upside makes real estate such a valuable investment.
With no equity upside there are far better investments available than residential real estate !!!
