Toronto Canada Real Estate Market

[Joseph Costanza]

Hello Bigger Pockets

A little over a year ago I started my real estate investment journey. I started to consciously save/invest my money as I prepared myself to make my first investment in real estate. I studied, read, and listened to many book, podcasts, forum etc. I focused a great deal of my attention in understanding the math behind real estate investing. The last year or so I've felt very confident in understanding the processes however now that I am financially prepared to make my first investment I find myself confused and lost. I find it hard to find Positive Cashflow deals in my area and was hoping some of you in the Bigger Pockets community may be able to give me some advice where to look.

I live in Vaughan, Ontario, Canada and have been advised to look within Toronto, Ontario for investments, however I am finding the Greater Toronto Areas are more feasible and more aligned with the information I have learnt from my studies. Thoughts?

[Ming Lim]

@Joseph Costanza @Nick Vazquez I'm a Toronto based investor and run a real estate investment firm. Yes, you can generate cash flow in the city, but it's not going to be like in the outskirts of the GTA. If you've read any of my posts before, I think cash flow is highly overrated. Not that cash flow isn't important, but rarely is there a full discussion on what cash flow means. It's a function of risk - the higher the cash on cash return, the higher the risk of the investment as a general rule.

The biggest returns in real estate for me have been through capital appreciation and where cash flow was enough to allow me to hold the property without issues. My highest cash flowing properties (I held 7 student rental properties in Waterloo at one point), had lower capital appreciation and therefore lower overall return compared to my Toronto properties. Time (mortgage paydown) and appreciation is really how big money is made. This means location (buying where jobs are, areas of gentrification, increased population)  is paramount when buying a property in my eyes. A couple of hundred dollar more or less per month, won't change my life, but a couple extra $100k's in appreciation makes a big difference.

This isn't to discount what others are saying about investing the outskirts of the GTA. I know many of them personally, and they to are successful at what they're doing. We've all become experts in our own areas of investing. 

At the end of the day, investing is an individual journey and anyone who tells you they've got the best investment for you, is wrong - you've got to figure that out for yourself.