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Why the Condo Market is a Smart Investment for Entrepreneurs

June 11, 2021

If you are an entrepreneur, have you thought about investing in the condo market? Many individuals have made money in real estate because it can generate a good profit, especially when done right. There are many benefits to investing in property, which explains why more and more investors are looking to buy condos in the Greater Toronto Area (GTA).

As an entrepreneur rather than an employee, you’re already taking different risks as a business owner. So when you’re looking to invest your hard-earned money, it makes sense to choose a relatively safe and secure investment. That way, you can have some peace of mind in the years to come that you’ll see growth in your portfolio. 

This article will cover some reasons why the condo market is a smart investment for entrepreneurs. Investing in the condo market offers higher returns, different options, and tax benefits. 

Condos can provide a better return than other investments.

On the one hand, investing in the stock market is risky. On the other, a real estate property is not as risky of an investment. After all, real estate is a growing industry that doesn’t seem to be stopping any time soon. 

Buying a condo to rent out is a good long-term investment because it enables you to grow your net worth. Although the real estate market fluctuates over time due to a number of different factors, when prices go up, the value of your property does too. The general consensus is that the longer you hold on to a property, the better your chances of making a profit. 

Unlike other types of investments, a condo is a tangible asset that holds its value over time. The value of other assets tends to go down while the value of real estate stays the same or goes up. For instance, the value of a car decreases as it gets older, but the cost of a condo has steadily increased over the years. 

Additionally, you have more control over the physical property. You can make some changes to the condo to increase its value. For example, you can do upgrades over the years to increase the value of your condo before reselling your unit for more money than you paid to purchase it.

A condo diversifies your investment portfolio. 

A good rule of thumb when it comes to investing is to diversify your portfolio to reduce risk. To put it simply, you don’t want to put all your eggs in one basket in case things don’t work out. If you have only invested in one type of investment like mutual funds or stocks, you can buy a condo to add another type of investment to your portfolio. In doing so, you add a lower-risk investment that doesn’t require much maintenance on your end. Real estate has a low correlation to the stock market, and so even when stock prices for companies drop, the housing market is largely unaffected. 

Condos offer freedom and flexibility. 

As an entrepreneur, investing in the condo market offers you more freedom and flexibility than other investment options. There are different ways you can make money as a property owner. After purchasing a condominium, you are able to rent it out to someone else or resell the unit down the line when the time is right. By renting your unit, you have another stream of income, and you can use the additional money for other investments. By selling your condo, you stand to make a greater profit when the market is trending upwards. Something to keep in mind is that you build equity when you pay down a mortgage, and as you do so, you’re in a better position to purchase additional condos. 

A condo has some great tax benefits.

Did you know that you can get tax deductions from owning a real estate property? Every tax season, you are eligible for certain benefits. Unlike other investments where you have to pay tax on what you make, you don’t have to do so with a condo. The deductions will vary depending on where you live, so if you have any concerns, ask an accountant about what tax breaks you are eligible for.

A condo can be a long term investment for retirement.

Planning for retirement as an entrepreneur can be a little tricky because you’re on your own. It’s a good idea to invest in the real estate market before retirement to fully reap the benefits when you retire. If you aren’t sure where you will live when you retire, you could buy a condo. That way, you won’t have to be responsible for the repairs and responsibilities that come with being a homeowner.

Should you invest in a condo as an entrepreneur?

Ultimately, the decision to buy a condo is up to you. As always, you should do your research and determine what kind of investment makes the most sense for you and your lifestyle. By investing in a condo, you can benefit from passive income, cash flow, tax benefits, and much more.

A condo could be right for you if you want to diversify your investment portfolio to reduce risk. With a condo, you have different options at your disposal. You could purchase a condo and rent it out, which gives you an additional stream of income every month. Some individuals try to buy low and sell high to earn a profit. You can also enjoy tax breaks and invest in real estate to help with your retirement goals.

Do you have questions about buying or selling a condo? You can get in touch with a broker to learn more. Feel free to call Sunny Sharma at 416-566-2850 or Kathleen Xie at 416-587-8381. 

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