IF BUYING A CONDO AS AN INVESTMENT:
Know the costs:
Make sure to calculate all your expenses, including down payment, legal fees, strata(condo) fees, property taxes, property transfer tax, home inspection fees, appraisal fees, painting, appliances and assessments to fix leaks or defects.
Know your ROI:
For a property that costs $ 250,000 and generates $ 1,300 per month in rent the cap rate is 6.24%(15,600 divided by $250,000). The rule tends to be that if you get less than an 8% cap rate, the property may not produce positive cash flow each month. That' because if you have a $ 200,000 mortgage, at a rate of 6% amortized over 25 years, for example, your monthly payment will be $1,292.Then added condo fee, insurance and upkeep.
Know the laws:
get a copy of provincial condo legislation and by laws. Make sure rentals are allowed. Scrutinize strata council meeting minutes to see if there are recurring problems that could become your nightmare.
Know the deductions:
There are tax implications and deductions. Keep records such as receipts for extensions. Get professional advice from accountant and a lawyer.
Know the market:
there will be dips and downturns in any area, but overall the trend line is usually up. Typically, the best location to get maximum price appreciation is in an area with good transportation and shopping close to downtown.
Know your limits:
Do you want to get up in the middle of the night to unclog a toilet? If not higher a manager.