Quote from @Josh Jones:
Hi everyone,
I recently got a new job in downtown Toronto and now have the down payment to buy my first property. I'm looking for something between $400,000 and $600,000, but as many of you know, Toronto’s real estate market offers very few opportunities to buy, refinance, rent, and resell within that price range. Because of this, I’ve been considering properties further outside the city, even up to an hour and a half commute away.
My Situation & Dilemma
-
Work Requirements: My job requires me to be downtown 3–4 times a week since I work in events.
-
Rental Strategy: I want to rent out part of the property while also living in it to offset costs.
-
First-Time Homebuyer Benefits: If I live in the property full-time, I could take advantage of first-time homebuyer tax benefits.
-
Current Living Situation: I currently rent a very affordable place in Toronto. One option is to keep renting while buying an investment property elsewhere—potentially designating a small space in the new property as my “permanent residence” for tax purposes while still renting most of it out.
What I’m Looking for Advice On:
-
Long Commutes & Homeownership – Has anyone bought a property far from their job just to take advantage of first-time homebuyer benefits? If so, how did the commute impact your lifestyle?
-
Declaring Primary Residence While Renting in the City – Would it make sense to keep my affordable rental in Toronto and still claim the new investment property as my primary residence?
-
Best Strategy for a First-Time Investor – Given my budget, goals, and job location, what would you do in my situation?
I’m a new investor trying to make the smartest decision possible, and I’d love to hear from those with experience. Any advice is greatly appreciated!
Hey Josh. Fellow Canadian here.
I'll try and help you answer your questions without suggesting an Ohio market to invest in lol.
1. Typically when people are purchasing properties further away from their job its not for "first time homebuyer" benefits but because the market they live in is too expensive. In terms of asking how much this impacts your lifestyle I would ask how long you plan to work downtown. Would the commute be a short term problem or long term problem? Could you find a job where you would want to live?
2. The only way I can see this as viable is if you rent out your primary residence portion as a STR. In GTA you can only rent it out as a STR for 180 days of the year but this could maybe justify keeping your rental in the city if the STR income offsets it. Keep in mind you would not only be learning how to manage a LTR but also an Airbnb and this would be a lot of work.
3. Most GTA investors I know do 1 of 2 things. Usually house-hacking is unaffordable or nowhere near where they work (your issue) so they will often keep their high earning income job and then invest remotely. For your first property please don't buy sight unseen in a place you've never been. The second option is to wait until you have enough money and then invest in development opportunities in other Canadian markets -> think Edmonton, Calgary, Winnipeg, Saskatoon. If you are a high earner don't bother buying these $80k properties that rent for $800/month. Save your money and then educate yourself so you can make a bigger splash down the road.
This is all assuming that your living expenses are low enough that you can save enough money to invest it in other markets. There is a reason so many people work in Toronto but live 1.5 hours away - its because of affordability. It may make sense to invest while you rent financially, but I think that it feels bad to rent while buying other properties - regardless of what Grant Cardone says. Toronto condos are on sale right now so you may be able to start low balling some 2 bedrooms and then rent out the other bedroom to get some extra income..this would be the simplest version of investing for you and would allow you to at least benefit from your primary residence appreciating and paying down your loan.
Hope this helps!
Cheers
