The markets to target and avoid, according to one investment veteran
Justin da Rosa
Canadian Real Estate Wealth
Peter Figura, director of national sales at Centurion REIT, has worked as an investment advisor since 1999. Today, however, he specializes in private real estate. And while there are certain Canadian markets he believes provide great opportunity for real estate investors, it’s an American city he is most bullish on.
“Usually when you talk to Canadians about U.S. real estate they think Arizona, Florida. I was blown away by Seattle. The apartments are very different,” Figura told Canadian Real Estate Wealth. “It’s a very different market with a different approach to renting. The highest propensity to rent and the lowest propensity to buy. Everybody wants to rent.”
One positive about Seattle for investors is that there is no rent control. That and the availability of properties.
“In the states, the market is 10 times bigger but the apartment market is 30 times bigger than in Canada. What this does for investors, many people postpone buying,” he said. “From an investor’s point of view it’s good because there’s no rent control, [and] there is no shortage of properties to buy and it’s one of the best markets to find renters. They created around 50,000 jobs last year.”
Still, there are some markets in Canada as well that Figura believes offer ample opportunity.
“I think there are areas outside the GTA and everyone is talking about which will be the next one. Hamilton was beat up for years but it’s reinventing itself and it’s growing. The towns around that, like Stony Creek, Grimsby,” he said. “I think Kitchener –Waterloo might be interesting with the high tech sector.”
And, of course, there Canadian markets he advises investors to avoid.
“The Vancouver and Toronto are definitely ones to avoid, in my opinion … or the price may be out of range and the cap rates may be low. Toronto has rent control, you can go around it in a certain way but it’s difficult. Condo conversion is not available in Toronto,” Figura said.
“Outside Ontario, you have to be careful. Alberta and Saskatoon were doing fantastic, but now they aren’t so great,” he continued. “You need a careful approach with those markets. There might be pockets of opportunity because prices are suppressed.”
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