Investment real estate continues to be a safe alternative investment and with interest rates remaining low, investors continue to flock to real estate. What may not be known is that Waterloo Region is fast becoming a very good alternative to the GTA. Commercial properties have skyrocketed in the GTA and investors are looking outside of that area for investment opportunities.
When buying an investment property there are several variables to take into consideration. With that said, most people simply look at the Capitalization rate (CAP). The CAP rate is the rate of return on a real estate investment property based on the income that the property is expected to generate. The capitalization rate is used to estimate the investor’s potential return on his or her investment.
While CAP rates have been declining in the GTA, they continue to remain decent in Waterloo Region, ranging from a low of 5% to as high as 7%.