Let’s get one thing straight: 2020 hurt. It was a grueling year for Windsor real estate that hit many of us hard. From head, to heart, to wallet, the pandemic has left its mark. But Ontario is still on a growth track, and Windsor, ever determined, has fought the effects of this pandemic mightily. With recovery in sight, now might be the perfect time to invest in this residential real estate market primed for long-term growth.
The Windsor market going into 2021 is extremely buyer friendly. This year is poised to set investors up to enjoy significant, long-term returns on their residential real estate investments, with historically low risk. Here’s why:
The first rule of business is that you must have demand for your product to be successful. If rental properties are the product, rest assured, Windsor has the demand you need, and will continue to increase that demand over time.
In Canada’s geographical makeup, Windsor functions as a “landing community” for newcomers to Canada. Therefore, as long as Canada continues to grow, Windsor will grow alongside it.
In fact, recent reports indicate that Windsor saw a building boom in the last quarter of 2020, despite the pandemic’s effect on the local and national economy. At the end of 2020, the city issued permits for 752 new dwellings, beating last year’s permitting activity by 71 homes and both of the two years prior to 2019 by nearly 400 units. Clearly, home builders like what they see in the Windsor market.
To put it in perspective, Windsor has not seen this kind of building activity since the 1990s, according to Chief Building Official John Revell.
In addition to an increase in supply, interest rates are at a historic low. The pandemic has encouraged the Canada Central Bank to pin interest rates at around .25, and until the economy rebounds, you can expect they will hover around that number for the foreseeable future. This could save you thousands of dollars over the lifetime of the mortgage you might take out on an investment property, significantly reducing your overhead and boosting your return on investment.
Over the last decade, Canada’s population has been growing at a rate of 1.1% per year, outstripping any other G7 nation’s population growth by quite a bit.
Windsor’s population growth has kept pace with the overall figure for Canada and is currently ranked among the top 20 fastest-growing metropolitan areas in Ontario, an achievement it’s held handily for some time now.
Now, you may be wondering how this plays in your favor if you’re just starting out in the real estate investment game.
Well, in 2019 Windsor slipped a bit in its growth trend. It fell from the top five fastest-growing metros in Canada to the 15th. Bad news, right? Maybe for some, but not necessarily for you.
What this has done is create a record-low point of entry into a great real estate market that might not have otherwise occurred save for these mitigating economic factors.
Some investors who are in the short-term fix-and-flip game may be gun shy about investing in Windsor after a one-year dip in population growth, but the discerning investor with a patient approach will see that this market is still positioned for solid growth in a metro with enduring demand for multifamily units.
Today, an investor can buy into the Windsor market at the bottom of a growth cycle, with the assurance that Windsor will continue to grow at a healthy clip for the foreseeable future. Aside from the ability to read the future, it’s hard to ask for a better set up for long-term success.
Investing in Windsor now is a great way to ensure growth in your investment. The combination of rock-bottom interest rates created by some of the toughest economic times in this generation and the beginning of a building boom means that 2021 is a great year to make your move and set yourself up to build real wealth.
One of the best parts of investing in Windsor is that you don’t have to do it blindly. There is a bustling community of life-long real estate professionals to help you set your sights on the right property for you and your goals.
Some resources to look into include the Windsor Essex Economic Development Corporation, the Windsor-Essex Association of Realtors, and local property management companies like MARDA.
All of these professionals and more can help you determine how best to invest your time and money in a property, tell you where the hotspots are in the community, and set you up for success in the long run.
Once you’ve secured your rental property, you’ll need to consider how you want to market and operate it.
Hiring a management company can help you to avoid legal trouble down the road, add legitimacy to your rental property in tenants’ eyes, and take the headaches out of finding credit-worthy tenants.
Property management companies have all of the technology and service subscriptions necessary to run background checks on potential tenants, saving you the hassle of trying to corral all of those services on your own.
If you do go the management route, take the time to really understand your options. As with anything in life, you will get what you pay for, and the cheapest options are rarely the best. Take the time to get to know the management companies you’re looking at, and don’t rush into something you don’t fully understand. We would be happy to evaluate any agreement you are considering.
So, why are we so confident that now is the time to invest in Windsor real estate? Let’s recap the highlights:
- Windsor is a prime growth spot
- Interest rates are low
- You have the support structure necessary for success
After a brutal year, what better way to bounce back than to make a move toward building wealth and securing solid financial footing?
If you have any questions, please do not hesitate to reach out. We have knowledgeable and skilled real estate professionals ready and willing to help you navigate these waters and take the headaches out of starting your real estate investment journey.