Condo Rental Ownership Woes
Condo investment is not only great for the entrepreneur in Toronto; it is also a business when copious amounts of money can be made. There are several high risk factors when it comes to condo investing that is especially true if you are thinking about renting. Owning rental properties and therefore being a landlord presents its own set of issues worth considering. It can be a solid investment, but there are drawbacks to this particular area of condo investing that must be considered. Let’s talk about some of the things you want to be aware of before purchasing your first property for rent in Toronto.
To start, owning and managing your own Toronto rental properties can quickly take over whatever life you previously had. Since in the beginning you probably won’t be in a position to hire a management company, you must be prepared for the time commitment that comes along with this territory. Unexpected problems always seem to come up at inopportune times. 24/7 you will need to be available to handle floods, electrical issues, leaky roofs and running toilets. The complaints will come early in the morning and late at night, during the week as well as on weekends. Tenants will always be calling you, and for the sake of your property, you want to be available.
Don’t even think about being a Toronto rental property owner if you can’t be tough and have a thick skin. Rent must be paid, and if you’re the tenderhearted type you may find yourself taken advantage of every month. This is actually one of the biggest reasons owners break down and end up hiring a management agency; it can be hard to say no to people. You must not let those dramatic sob stories tug at your emotions, remember, this is a business you are trying to run – not a charity.
Next is taking into consideration the cost keeping up the properties plus repairs that will certainly need to take place. You have to face the fact that people who rent don’t normally treat the property as good as they would treat it if it were theirs. This is why you will have a constant need to fix it, paint it, or carpet it when it comes to your rental properties. Hopefully this only happens between tenants, but occasionally it happens with tenants more who are harder on your property than others. All of this is not only added costs but takes energy and time to complete.
Finally, you always want to have the properties occupied with tenants. An empty property is costing, not making, you money. As a property owner, it will be up to you to keep a steady flow of viable potential tenants should you have a vacancy. Long-term tenants who are willing to keep good care of your property are always best. One of the best ways to get good tenants is to treat the ones you have well, make the rental price fair, and provide quality properties to rent.
Being the owner of one or more Toronto rental properties can be a successful and profitable business venture, but it is often a lot more work than originally thought. When you think of other avenues available for investment in condo, this may require less up front work, but the long term work will more than make up for that in the end. Owning rental properties can however be a very profitable business over the long haul. Not only are you making your money every month off rents, there is the potential for property values rise over the years which can make for a nice payoff down the road if you ever decide to sell.
Whether you get a property manager or decide to manage yourself, being the owner of rental properties has its own set of challenges, but can end up being a great investment.
