When it comes to building a portfolio of investment properties, there is something on the menu for every taste. To suit your specific tolerances and objectives, you will want to discuss the ins and outs in detail. But I thought it would be fun to write-up a brief table of ingredients for two types of residential properties that are at opposite ends of the spectrum from each other (with other properties like detached homes, freehold or condomium townhomes or terrace homes, duplexes, and others lying in between.)
|Significant hands-on maintenance often required.||Very low maintenance.|
|Lower impact from single unit vacancies.||Low vacancy rate but 100% impact when vacant.|
|More turn-around opportunities to build equity.||Little opportunity to build sweat equity.|
|Higher cash-flow.||Cash flow is often a real challenge.|
|Greater potential for one-time high cost items.||Condo fees and assessments hinge on quality of builder and ongoing management.|
|Value largely driven by income generated.||Value exclusively driven by market forces.|
|Most are older properties governed by rent controls.||Properties built post-1991 are not subject to rent controls.|
There are numerous other points of comparison; some of which are yelling at me from inside my brain trying to get onto the page right now. But this is a good start. If you’re curious about it, get in touch and let’s explore further.
Bruce Brown is a real estate broker with Bennett Property Shop Realty, brokerage.