Top Markets in Canada for buy and hold cash flow?

17 Replies

I'm originally from Canada and still own a rental property there. I am looking to possibly buy more and curious to know what are the top Canadian markets to buy in right now for a cashflow buy and hold strategy and perhaps some house hacking for my father. I would prefer the western side as I have family scattered in that area but it would not be a deal breaker.

If you wait for the crash you'll find all kinds of deals.  Most major Canadian markets are heavily over-priced.  You have to go to small towns and fringes to find favorable returns.  We have Canadians calling us often for better deals south of the border (although the low CDN dollar has slowed that down right now).

Medium norada real estate investmentsMarco Santarelli, Norada Real Estate Investments | (800) 611‑3060 | http://www.NoradaRealEstate.com

@Joey Noel

@Marco Santarelli is correct for much of the country.  In central Canada, Alberta, or the left coast, it appears these days that you need to venture into the smaller cities and towns to find numbers which make sense.

Here in the Maritimes, you can still find deals in the various cities (Halifax, Fredericton, Moncton, Saint John), but even here they are becoming a little endangered (Halifax, Fredericton) and in Saint John you need to keep a very close eye on the location and the local economy.  Moncton is probably the most affordable at the moment, but you still should make time to know the areas of the city before dashing off a cheque.   

The tradeoff here in the east is you are not going to see the appreciation highs you might find in the Golden Horseshoe, but you are not going to see the lows either.  Traditionally, the economy is more resource-based - particularly in the smaller communities - and we have an ageing population (the young have been streaming to Alberta for a generation, then returning east to retire).

Now about that market correction, it's been overdue for a few years, but the current trajectory continues to diverge from the underlaying economic fundamentals which should make folks more cautious when analysing prospects.

Medium greenapartmenthires 1024x1024Roy N., Louer Louer Ltd. | 1.506.471.4126

I'm located in the Niagara region, what are your thoughts on the Niagara Falls market?

Yep, not sure Canada has much in terms of cash flow these days. Very over-priced!

Medium hipsterinvestment logo black300dpiAli Boone, Hipster Investments | [email protected] | 310‑957‑2101 | https://goo.gl/x52ZKJ | CA Agent # 01911993

Originally posted by @Alam Burgos :

I'm located in the Niagara region, what are your thoughts on the Niagara Falls market?

 Alam:

There are some Canadian BP members here who are operating down in your area, Hamilton and St. Catharines, and a few a little further west in St Thomas and Windsor, who are still finding deals.

Medium greenapartmenthires 1024x1024Roy N., Louer Louer Ltd. | 1.506.471.4126

Originally posted by @Roy N. :
Originally posted by @Alam Burgos:

I'm located in the Niagara region, what are your thoughts on the Niagara Falls market?

 Alam:

There are some Canadian BP members here who are operating down in your area, Hamilton and St. Catharines, and a few a little further west in St Thomas and Windsor, who are still finding deals.

Yes...I'm one. I've been investing mostly in Hamilton since 2010...still finding some cash flow deals but getting more challenging to find them....but they are out there!  

Hamilton, Kitchener, Barrie, Edmonton, Calgary all good markets....need to have some solid boots on the ground to know where deals are to be had.

Thomas

@Thomas Lorini

Calgary is stupidly over-priced now.  Just came back from there a few weeks ago and a tear-down in some of the better areas are $1MM+.  The rent-to-value ratios there are very low.  A common issue in many Canadian markets now.  Scary!

Medium norada real estate investmentsMarco Santarelli, Norada Real Estate Investments | (800) 611‑3060 | http://www.NoradaRealEstate.com

@Marco Santarelli  if I remember correctly you are originally from Calgary eh?  

What is your prediction for that market in relation to the recent oils field bust?  A lot of people are losing there jobs up there. 

Hey @Joey Noel ,

Your memory serves you well.  :-)

 We have clients in Calgary and they have told me that there have been layoffs or shifts in employment. I also have family constructing new duplexes right now.

My feeling is that there will be a bit of a softening in the real estate market and a little slow down in sales but Calgary is a surprising market because somehow there is still enough demand to keep propelling that market into the sky.

I fear for those who are buying into the market now speculating on appreciation.  People will get burned based on the greater fool theory.

Sooner or later that market will deflate, it has to, there is no other choice.   Low interest-rates, a growing population, and lots of capital coming into the city will keep prices high.

Medium norada real estate investmentsMarco Santarelli, Norada Real Estate Investments | (800) 611‑3060 | http://www.NoradaRealEstate.com

@Alam Burgos - @Roy N.

 is correct - there is alot of potential and a lot of deals in great markets like Barrie & Hamilton – I invest in Niagara Region (St Cats/Thorold) and that is an opportunity too, mind you many homes need a little more love and touch, but can be worth the efforts. It is a riskier market much like a Windsor – great entry level though, in my opinion before you try to start playing with bigger #’s and bigger players like those in KW, Kingston and onwards.

I enjoy reading postings by Roy, as he is very in tune with the Canadian market, and very detail-oriented – may be a good person for you to “follow”.

I can certainly atone to the market in the Niagara Region. As a long time investor in cities like Niagara Falls, St. Catharines, Port Colborne, and the surrounding areas, there is still plenty of opportunities to find great investments. 

We are still benefiting more every day with the influx of commuters, increasing job stability, and ongoing increases in property value. I'm not going to predict anything, but rentals always seem to stay steady regardless of what the market does. 

Traditionally a long term investment strategy will always put you on top if you buy smart and plan well. I've yet to make a bad investment here and often scratch my head at all those who choose to invest in the Toronto area or wait until an area is seeing really good growth before investing. 

Hamilton was predicted to be the next big thing back 10 years ago when I first started investing. There are still places you can make gains, but I think the majority of people investing there now have missed the boat on the great long term holds. Many of you who follow the ACRE system and Don Campbell will know what I'm getting at here. 

I don't personally follow Don's system, but he's the guy who said Hamilton would be hot and he was certainly right all those years ago due to transportation corridors and other such research into modern city growth patterns....hats off to Don. He was right and is rarely wrong. 

It's those outlying areas that are seeing the growth now. Those small towns where people can still afford to buy a home that seem to be getting the additional boost as Toronto and the major metropolitan areas continue to explode. Immigration alone is a huge driving force behind the growth in Ontario. With more than 85,000 immigrants a year calling Ontario home. They need a place to live and they often bring money with them to make this a reality. 

This is an ever increasing part of the growth of our country and something everyone who invests here need to keep top of mind. This ripple effect has been a huge part of the growth for the metropolitan cities in Canada. 

Originally posted by @Justin Herrington :

@Alam Burgos - @Roy N.

 is correct - there is alot of potential and a lot of deals in great markets like Barrie & Hamilton – I invest in Niagara Region (St Cats/Thorold) and that is an opportunity too, mind you many homes need a little more love and touch, but can be worth the efforts. It is a riskier market much like a Windsor – great entry level though, in my opinion before you try to start playing with bigger #’s and bigger players like those in KW, Kingston and onwards.

I enjoy reading postings by Roy, as he is very in tune with the Canadian market, and very detail-oriented – may be a good person for you to “follow”.

 I agree, I've seen and read many of Roy's posts and I've always intrigued by how much he knows, no matter what part of Canada. He never seems to forget about the smallest details that most starting, and maybe even some experienced, investors may leave out of the equation.

@Roy N. is certainly the bomb on here. Always love your posts Roy. If I ever head your way I want to buy your dinner and personally thank you for your input!

Ok all of you, that's quite enough.

I learn more from the rest of you folk here than I could hope to ever contribute.

I have a mind burdened with retaining trivia and other little tidbits of "not always useful" {according to my wife} information, but cannot remember things such as grocery lists, anniversaries, where I parked the car .... the list is endless.

Dave,

Good to see you here again.  The rehab inventory down Welland / Port Colborne way seems to be keeping you busy these days.  Haven't been tempted to start farming over Buffalo way?

Since I have no major renovations underway at the moment, I've been curious about how far one needs to get from the GTA these days for property prices to drop from ridiculous to merely très chère.  Based upon recent posts from @Doug Pretorius in recent threads, the Big Smoke effect has crept into Kitchener - Waterloo.   However things at the far end of horseshoe still seem merely expensive.  

I have a bunch of CMHC and StatsCan data which I'm playing with to see if I can tease anything meaningful out of it.

Medium greenapartmenthires 1024x1024Roy N., Louer Louer Ltd. | 1.506.471.4126

@Roy N. I've been to Buffalo...again as with many of the posts on here about investing across the border I still must say that the risk vs. reward seems a stretch for me overall. 

I've been there, seen it, and frankly don't see the potential when I can play in my backyard and knock it out of the park every time. 

The other big consideration is the tax implications and the legal ramifications. Hardly seems worth the effort to me. One of the reasons why I keep telling people to look around in Canada before you jump through hoops just to try and make a buck in a country that in my opinion has not really figured it out yet. I believe that the US is not out of the woods yet...not that the market here couldn't fall into the abyss like the US, but I'll certainly take my chances in my hometown over the US any day.

Besides having my long term holds in my backyard and knowing the Canadian rental rules, laws, and regulations is certainly to my benefit as a landlord and investor. That's the way I look at it anyway. Just my two cents. 

I too feel like you with the amazing ability to retain sometimes useless information and have a partner that often reminds me that as someone with such a great memory it's relatively pointless unless you can remember where you set down your keys....

Originally posted by @Dave Vogt :

I too feel like you with the amazing ability to retain sometimes useless information and have a partner that often reminds me that as someone with such a great memory it's relatively pointless unless you can remember where you set down your keys....

Dave: 

That one's easy ... keys are probably on the top of the car (I set too many things on the top of the car) or, like yesterday, hanging in the front door of the house ;-)

Medium greenapartmenthires 1024x1024Roy N., Louer Louer Ltd. | 1.506.471.4126

Laughing my butt off right now @Roy N. I needed that....thank you! 

May you have an amazing day...and may your keys magically appear every time you need them!!

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