Best places to invest in real estate in 2021

by Taylor Pipe on 12 Feb 2021

It's no secret that the COVID-19 pandemic has affected a variety of industries negatively. But one industry in Canada that seems to be thriving is the Canadian real estate market.

Many investors are seeking out properties as an opportunity because if one thing has remained certain this year, it's that housing investments remain strong despite what headlines may have people believe (no, the housing market isn't likely to crash). And, it seems like, in most major cities in Canada, condo construction or housing developments are continuously on the rise (literally). Ultimately, cities are facing unprecedented growth even in the midst of a pandemic and the demand for housing has never been higher. Were we all surprised by this? Absolutely. But now, investors can use that to their advantage.

Increasing Demand for Properties in Canada

Outlier communities: one of the best places to invest

With Ontario having the largest population in Canada, it's no surprise that it's become a hot spot for real estate investment. With house prices skyrocketing in cities like Toronto, Ontario has seen more widespread growth due to people choosing to live outside of the bustling downtown core since they've been able to work from home.

The pandemic has been a large factor in how people are viewing living in different cities than when their place of employment is located.

"I think people have come to realize is that it's a virtual world and so some of the best opportunities have been outside of the core," said Matt Elkind, Managing Director and Partner of Connect. "If you're not coming into your office, you're better off living somewhere where you can get more for your money than in the corner of the city."

Areas that are seeing an influx of out-of-towners are going through huge transformations and continuously breaking real estate records. Places that were once undesirable because of their location, are actually great places to break into the rental market and seek out investment opportunities in housing.

Investments in Hamilton

Hamilton, Ontario

Hamilton is known for being a blue-collar, industrial city. But in recent years, Hamilton has become one of the best places to invest in single-family homes. The area is home to top healthcare institutions and a booming restaurant and food industry.

The price to buy real estate in Hamilton compared to Toronto is quite tame. Houses in Toronto can be sold as high as one million dollars for a two-bedroom bungalow whereas the average price in Hamilton is just under $650,000. This makes Hamilton an incredible place for investors who are looking to make an income by converting a house into a multi-family duplex.

"Smaller towns close to larger towns are going to do incredibly well for sure and Hamilton is going to continue its own growth story," said Elkind. "Fundamentally the country is growing, and it's growing through immigration. We're gonna have to create more housing than we have now, and the supply isn't going to be increased with the demand."

The Metro Vancouver Area

Vancouver, British Columbia

It would be pointless to talk about the top national places to invest in real estate without mentioning Vancouver, of course! The city is home to jaw-dropping mountain views and renowned for its fresh seafood. In addition, Vancouver has an abundance of space dedicated to conservation which helps nature lovers connect in the big city.

Vancouver is one of the top places to invest in real estate in 2021 for its natural amenities and its fantastic transportation network. The Metro Vancouver area is home to 21 municipalities with an array of properties to invest in for people coming across the border once it opens back up.

"Rates are at all-time lows and people really are confident on where the [real estate] market is going," Elkind said. "As soon as we see the borders open up. We're going to see a real, real increase in rental demand as well."

Windsor, Ontario

Windsor is one of the more affordable places to invest in real estate or for beginners to break into the market. Housing investments in Windsor are ideal because it's directly across from Detroit for those with American friends and family, and many of the prices for homes in Windsor continue to sit in the lower range. The average price for a home in Windsor is just over $425,000.

This also means that investment opportunities in Windsor are likely to turn a high profit because markets in cities like Windsor are just beginning to see a real estate boom. Windsor is also beginning to see revitalization in its job and work sector and data suggests homes in Windsor sell under two months - even during the pandemic.

"We've seen all these smaller markets really take off because you need over a million and a half dollars to buy a nice real house in the core," Elkind said. "In other places, you can buy a great house for half a million dollars. You don't have to live near an office tower downtown."

Rental Market in Guelph

Guelph, Ontario

In the year 2020, Moneysense.ca listed Guelph as its best real estate market to buy a house. Property in Guelph is selling on average just over $500,000. The city is home to the University of Guelph and is nearby to many agricultural communities. However, Guelph is still close to the 401 highway which makes it a popular destination for those who work in Toronto and need to commute every day.

Guelph has a number of parks to allow residents great outdoor space and is seeing companies establish themselves in the Royal City. Although Guelph is a University town, it's still a good place to raise a family or turn your cash into a real estate investment. Guelph has a small unemployment rate and is becoming a new leader amongst Canadian cities in terms of environmental sustainability initiatives.

When looking for real estate investments in Guelph, it's important to consider it's a town that is undergoing huge growth and a rising population. The city is creating a plethora of new developments that are waiting for investors to cash in on. Data shows Guelph is one of the fasts rising markets and is abundant with space for families to live for years to come.

Kingston, Ontario

Because of its proximity to the capital of Canada, Kingston Ontario is an ideal location for those who work in Ottawa. Last month, Kingston was one of the first places to come out of lockdown after taking time to make sure they were able to flatten the curve and keep everyone safe. Still, Kingston has many amenities and opportunities to invest in properties which makes it a high demand area for housing and new developments.

Those who invest in cities like Kingston should be able to cash out once the COVID-19 pandemic is over as the demand for properties in Canada reaches an all-time high.

"[Once] the global confidence is returned and diseases are more contained, we're going to see massive appreciation," said Elkind. "There's more money than there has ever been on the sidelines waiting to come in right now."

Canada: a growing real estate market

Canadian real estate has never been hotter. Buying a house to convert to a rental property, or simply flipping houses and playing ball in the real estate market during COVID-19 will help you get the highest return income for your space.

When looking for a solid real estate investment, it's important to keep in mind that property price can soar in any city during any year. The demand for properties has never been higher and the outlook for investing in these cities has never been so good. Your job as an investor is to find top-quality investments that are guaranteed to bring in cash and increase your monthly income. Investing in a new, upcoming city that's on its way to becoming a top real estate investment city helps you manipulate the real estate market and get in on something exclusive.

"It's a really safe place to put your money where you can get really solid returns," Elkind said. "As long as you're investing with a long time vision, you're going to do incredibly well."

Within the last year, the Canadian rental and residential and commercial real estate market has exploded. For someone looking to invest in real estate, now is the right time. Real estate investing may seem stressful, but purchasing a property and seeing the price increase over time, or gaining profit from using your real estate investment as a rental is not only beneficial for you as a real estate investor, but for the increasing Canadian population. Plus, with the help of a professional, you're sure to secure the right property.

Picking the right investment property

When investing in Canadian real estate, you have many options to chose from. Single-family houses and condos are a solid and safe bet when it comes to your money. Condos are increasingly popular amongst real estate investors in bustling cities, especially because they're a bit more budget-friendly.

"Depending on your lifestyle there's a lot of advantages of living in a condo," Elkind said. "If you're someone who goes away on the weekend, who doesn't want to bother with landscaping, or, if you don't want to own a car and you want to live close to work - these are great reasons why you should own a condo."

Purchasing a property as a real estate investment poses its own challenges. You have to actually like the space and be confident you can get a good return on your investment. The space also has to work with your tenants or your family and it needs to have the potential for renovation or modern amenities for long-term usage. Condos are great options for those looking to spend a little less but earn a lot more.

Canadian Real Estate Investments

A safe real estate market to invest in

Either way, looking for a city that works for your real estate investing endeavours in Canada is great because the real estate market is increasing and demand for property from a growing population will only further increase the price of your investment property.

Look at places like New York. Real estate is incredibly hard to come by, and the market tanked due to the pandemic. Investing in the Canadian real estate market is a much safer bet since real estate in Canada is such a hot-button topic and the real estate market is thriving like it never has before.

Buying multiple houses in Canada is a good investment because it provides you with options if you want to flip, or rent out your property. With demand for affordable housing increasing, owners can actually help diminish housing crises in various Canadian cities and work to provide a more sustainable future and real estate market for generations to come.

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