Investing in the property market is a step that could make a lot of sense, especially in a city like Montreal, which has new developments almost everywhere you look! Many foreign investors have snapped up Montreal Condos in the last few years. But since any type of property is a big investment, it’s best if you take a step back and ask yourself a few questions first:
- What other projects are being built in the vicinity?
When checking out a property, you should also check out the general neighborhood as it could affect the value of your property in the future. Are there plans to build a shopping mall nearby? Is it near other commercial and residential properties that will be built in the coming years? For Montreal, you can check the official city website to know where to look and who to ask.
- What is the real value of the property?
The real value of a property is not necessarily equal to the selling price, so it’s probably worthwhile to get an independent and certified assessor to check its value.
- What is the rental potential of the property?
Since you’re investing in the property to rent it out, you must check how much it will realistically earn. This is where location also matters – is it in a neighborhood that has a high demand for rental property? The rental potential also dictates the rate of return on your investment.
- What do your competitors look like?
If you’re investing in a property to rent out, you must also check whether the market or the location is saturated with competitors. If there’s a high supply of rental properties in a certain area but no demand, then maybe you should think twice before investing. Before you put it out there, you should also check out the competitors. What are they offering and for how much?
- Who is your target market?
You must ask yourself who you’re planning to target, are you going for yuppies? Do you want a young family? Your target market is important in picking the location as well as in making your rental property market-ready.
- How much effort is required?
When you buy a condo unit, you’ll have to do some work yourself before you can rent it out. Sometimes, it’s even completely bare and you have to make some improvements or changes before it’s ready to be rented. It’s a smart idea to asses how much effort it will take, and whether or not the possible returns are worth it.
- What is the state of the market?
Speaking to a real estate agent may be helpful because it gives you some insight on what the market is currently like. Investing in something like a rental property isn’t a short-term investment. You’re in there for the long haul, so you should also be aware of what the next few years are looking like. A real estate agent that you can trust will also know the best locations to invest in as they have industry information that you may not have access to.
