Look for Your Next Investment in These Hot Cities

Look for Your Next Investment in These Hot Cities

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Are you on the hunt for your next hot real estate investment? Research is key. Each year, online magazine MoneySense compiles a ranking of the best places to purchase real estate. The list has helped homeowners and investors alike determine where they can find their best deal.

Table of Contents - Look for Your Next Investment in These Hot Cities

The ranking is based on property value, rental prices, affordability and future real estate appreciation. The magazine also relies on expert insight from a team of realtors familiar with the local economy and rental market. Four of the top five cities are located in Ontario, specifically in the Greater Golden Horseshoe area that comprises Toronto and Hamilton along Lake Ontario. Only one city from British Columbia made the top five. The complete list features 35 cities and represents every province.

When you’re looking for your next great investment, start your search in these bustling cities.

Windsor, Ontario

Windsor’s trajectory over the past decade has been one of the worst to first. When the U.S. economy crashed in 2008, Windsor felt the sting. Located across the Detroit River from the U.S. auto capital, the city was hurt by the global credit problem. General Motors was forced to close their transmission plant in the city, halting a major source of jobs. At one point, Windsor’s vacancy rate was 15 percent, the highest in the nation.

Today, Windsor is growing again after the economic downturn. Savvy investors bought when the market was low. The vacancy rate has declined to 3 percent. Windsor is well suited to thrive: it is the westernmost point in the Quebec City-Windsor corridor, which includes three of Canada’s five largest metro areas and nearly half of Canada’s population.

The average home price in Windsor jumped 20 percent between 2018 and 2019, from $268,168 to $322,109. It is an excellent place to invest in property and earn passive income from a large number of people working in the region.

Guelph, Ontario

Guelph has consistently topped lists of the best cities for purchasing an investment property. Located in the Greater Golden Horseshoe, more people have been moving to Guelph than leaving in the past few years. Despite this influx of new residents, unemployment has remained stable and low.

Guelph was the top city for real estate investing according to MoneySense’s 2017 survey. Guelph is also one of the cities included in Ontario’s Places to Grow initiative, making it a key focus in the province for economic development and infrastructure investment. Guelph is also home to the University of Guelph, an important driver for the local economy – and a consistent source of renters.

The average home price in Guelph is $527,300. Rental prices in Guelph increased an average of 20 percent over five years. Investors saw an 8 percent annual return over five years.

Brantford, Ontario

Another Greater Golden Horseshoe city, Brantford topped MoneySenses’s 2018 survey. Renters can easily commute from Brantford to Toronto or other cities. Brantford features a variety of housing types and densities and will continue doing so with a new condo and townhome projects planned.

Brantford has diversified its economy, allowing it to thrive while other southern Ontario manufacturing towns have struggled. The city has transformed dramatically in the past 25 years. Brantford is home to three post-secondary campuses, Conestoga College, Nipissing University and Wilfrid Laurier University, with enrollment predicted to rise exponentially from 3,000 to 21,000 in the next few years.

The average home price is just under half a million at $427,322. Toronto residents looking to find better investment prospects in the area can turn to Brantford for more affordable properties. The five-year average for return on investment is 9 percent.

Victoria, British Columbia

If you’re looking to invest in property in Western Canada, Victoria is the top choice. Great weather, great jobs and great schools make this city a popular place to buy and rent. According to MoneySense, hot neighbourhoods include Sooke, Rockheights and Gorge Vale. There’s a high demand to live in this popular area, and not enough housing to go around.

While the average home price in Victoria has risen rapidly over the past few years, the Canada Mortgage and Housing Corporation (CMHC) expects the market to cool over the next few years. Anticipated rises in the interest rate and the high cost of housing in B.C. are contributing to the changing conditions.

The average home price in Victoria is a steep $680,800, making it a tougher market to break into than other cities on the list until prices come down as predicted. For investors who can secure a property, they can expect a 7 percent return on investment over five years. Investors have also enjoyed a whopping 24.2 percent increase in rent for over five years.

St. Catharines-Niagra, Ontario

Two cities in the Golden Horsehoe round out MoneySense’s top five places to invest. Located along the U.S. border, the cities are roughly an hour and a half from Toronto and just under an hour from Buffalo, New York. Both are located along the Queen Elizabeth Way connecting the two cities. There are stops in both cities along the GO transit route.

Home prices in the region offer excellent value for homeowners and renters. The area boasts beaches, hiking, vineyards, museums and more to keep residents entertained. Home prices have risen in the past few years but continue to remain affordable.

The average home price in the area is a cool $393,500. The average five-year rent increase was 13.84 percent, while the return on investment in the same period was 8 percent.

Other top Canadian cities for real estate investment

While Ontario cities dominated the top of the list, each province has its city for top real estate prospects:

  • Gatineau, Q.C.
  • Winnipeg, N.B.
  • Saguenay, M.B.
  • Charlottetown, P.E.
  • Regina, S.K.
  • Halifax, N.S.
  • St. John’s, N.L.
  • Edmonton, A.B.

Smart investments require knowing not only what the hottest cities are, but also what areas offer the best return on your investment. Pay attention to property values, rental prices, affordability and future real estate appreciation when deciding where to make your next investment.

Best Cities to Invest in Canada - Best Canadian Real Estate Markets - REIN CANADA 2018


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Scott Dillingham

Scott Dillingham

I have been investing and lending to real estate investors for nearly 10 years now. After thousands of successful deals between flips, rent to owns, student properties and commercial assets I have developed a deep knowledge of real estate investments and have a passion of sharing this information with the world! If your looking for a lender who specializes in rental property financing you're going to want to connect with me at team@lendcity.ca.