Owning good hard assets has never been more important for Canadians. One asset that has proven to have long-term benefits in Ontario is owning good real estate. That’s partially due to Ontario’s continued demand growth from its population explosion, and partly thanks to Canada’s cheap money in the form of low interest rates. Keep reading to discover our personal list of the best places to invest in real estate Ontario 2021.
And now more than ever, people are realizing the benefit of owning good properties that can produce multiple streams of income.
The Canadian government has increased its immigration targets to over 400,000 people each of the next three years.
The only time we ever reached that milestone was in 1913.
And in recent history, Canada has continuously outpaced its target immigration numbers, so record highs are very much in the realm of possibility.
Here’s a fun fact for you, only about 20% of immigrants purchase a property in their first three years in Canada. After 10 years, it’s between 50 and 60 percent. That means there will be a lot of additional renters in Canada in the next few years.
And we believe Canada will have no choice but to keep interest rates low to boost the economy. Especially after the levels of debt accumulated in 2020. Without diving too deeply into economics, the Canadian dollar is going to continue to be devalued (you won’t be able to buy as much in 5 years as you could buy today). That’s why we believe everyone should own good assets that hold value.
These are just some of the reasons to consider investing in real estate in Ontario, Canada in 2021. Here are the best places to invest in real estate Ontario in 2021…
Hamilton is a great city to buy or rent. The city is seeing massive growth and revitalization in recent years. It’s healthy growth too. People are coming into Hamilton to raise families, be part of a community, and enjoy all the city has to offer.
The growth in Hamilton is also a mix of those coming in but commuting out of the city for work, and those moving in to work in the city itself. For commuters, transit is expanding in the city, and it’s relatively simple for Hamiltonians to travel into Toronto. For those looking to work in Hamilton, the city boasts of one of the most diverse economies in the province, and below the provincial average unemployment rates.
There is also massive demand for rentals in Hamilton. One member of our team recently listed a property for rent in Hamilton and within an hour, she had 70 inquiries into the property. And this isn’t a one-off. Investors we work with are regularly able to get over ask for rent on good homes. Plus, it’s becoming more common for prospective tenants to offer to pay the first year’s rent upfront to secure the property. It’s unbelievable!
One of the ways Hamilton is looking to deal with the lack of available units is by adding laneway housing. In parts of the city (currently restricted to a pocket of the downtown core), Hamilton has already approved that homeowners can apply to build a laneway house (if their house has a laneway that runs behind it) and use it as an additional dwelling space.
Laneway housing is a great way to add another unit to your list of investments. You're building on "free land" (land you already own). Unlike severing land, it remains part of the same address. An extra unit means adding another stream of income to your investment.
But Hamilton is also in the community outreach phase of their densification plans, and one of the proposed solutions is to allow these types of backyard accessory dwelling units to be allowed even without a laneway running behind the property. Some cities (some on this list) are already letting these types of cottage or carriage homes to be added because there’s such a need for additional housing.
Hamilton West: $579,625
East Hamilton: $537,351
Hamilton Centre: $497,511
The Hamilton Mountain: $610,827
Year after year, St. Catharines is consistently one of the best places to invest in real estate in Ontario. You hear that there’s demand, but it’s hard to grasp how much demand there really is. That is until you list your property for rent and the responses flood in.
Close to the U.S. border, good highway access, and the addition of GO train transit in recent years, have made St. Catharines appealing to a lot more people. And as more people are working from home long-term, St. Catharines’ price point for homes has a lot of people moving away from Toronto. St. Catharines is a city with good job growth. It's also home to Brock University (which also continues to grow and attract more students), a growing health science presence, and will play host to the 2022 Canada Summer Games.
St. Catharines is also a beautiful city, located in the Niagara Peninsula. It’s also near one of Canada’s largest tourist attractions (Niagara Falls), and is in the heart of the Niagara Wine and Fruit District.
Investors continue to see a massive demand for rentals in the city, often leading to competitive offers from prospective tenants. Inventory for rentals is so low that new listings get flooded with responses, and investors are able to secure good, long-term tenants for their properties.
St. Catharines is still one of the most affordable places to buy homes in the Golden Horseshoe, and that’s brought continuous demand for investors, especially as demand for good rentals is so high. Rent-to-own and traditional straight rentals have both been in-demand and popular investment options in the city. North St. Catharines continues to be the most popular location but there is demand throughout the city.
Average House Price: $464,500
Welland is one of the few places that has already approved the addition of accessory dwelling units on residential properties. That means that homeowners in Welland could (with proper permits) add a secondary suite to their house, PLUS a detached dwelling unit on the property, creating 3 units on one property. While some cities have approved this for laneway housing, and others will likely come on board, this early access to these types of properties could be a huge advantage.
Think of this. Are building supplies and the cost of homes more likely to go up or down? We don’t have a crystal ball, but the sooner we can own good assets, the happier we are. That's because we believe they have long term value. Being able to add an extra residence on your property, which you can rent out to another tenant is a massive advantage. And a trend we expect to grow in popularity over time.
Right now, the demand for good rentals is there, and we don’t expect it to go away any time soon. The population is expected to explode in Ontario in the coming years. And new housing developments haven't been keeping up. So, homes that have the opportunity for growth are good options to have.
Welland is also quickly gaining popularity. Welland is right in the middle of the Niagara Region, it’s within a half-hour of St Catharines, Niagara Falls, Niagara on the Lake, and Port Colborne.
For the last 4 years, Welland has been well above residential growth expectations, and it’s not likely going to slow anytime soon. In fact, Welland is ready for a population explosion in the next 20 years and has the zoning and plans in place for continued development and expansion. These are healthy signs to see in cities, and one of the reasons Welland shouldn’t be overlooked in 2021.
Average House Price: $400,800
For a long time, Peterborough was isolated from the rest of the Golden Horseshoe. It’s on the North side of the Greenbelt, which means it has room to grow. However, the commute time it’d take to get to Toronto left Peterborough a standalone city. That is till recently.
The expansion of the 407 has made the travel time far more doable for those looking to move North-East of Toronto. In recent years Peterborough has transformed into one of the fastest-growing urban centres in Ontario. Being on the far side of the Greenbelt means there is a lot more freedom for developing out. In recent years new subdivisions have been popping up and filling up just as quickly. Now Peterborough is seeing a lot of the spillover from Toronto that the rest of the Golden Horseshoe has been feeling for years.
That being said, Peterborough isn’t just a bedroom community. The city of Peterborough has 82,847 residents and continues to grow. It’s home to Trent University, Fleming College, and many local and global companies.
Average House Price: $571,956
Kitchener-Waterloo remains one of the fastest-growing regions in all of Canada. This is at least in part due to the high rate of jobs available in the region. Job growth and population growth are two of the key indicators we look for when looking for good areas to buy.
With the uncertain state of the economy, Kitchener-Waterloo’s robust job market is going to have a huge draw. It’s already happening. Waterloo was the fastest-growing region in Canada last year, and it’s likely to continue. A thriving job market is a great indicator of the health of this city, and that’s why it is one of the best places to invest in real estate in Ontario for 2021.
The region is the fourth largest manufacturing sector in Canada. It’s also ranked one of the top cities in the Americas for most business-friendly and best economic potential.
Like all of the cities on this best places to invest in real estate in Ontario 2021 list, we’re seeing massive demand for rentals across Kitchener-Waterloo. The KW area is another area on this list on the far side of the Greenbelt. That means it has a lot more flexibility when it comes to development.
This has given the KW region a lot of appeal for people looking to find homes with a little more yard space, and more options for suburban living. That being said, the city also has a growing, densifying downtown.
One thing to note, The city of Waterloo does have rental licensing. So, anything that investors would be buying in the CITY of Waterloo itself needs a license. It’s a pretty simple process but does require specific HVAC and electrical inspections to be submitted along with a floor plan (hand-drawn) and payment, criminal check by the landlord in the first 12 months, and plus yearly renewals.
Average House Price: $595,000
North of Toronto, on Lake Simcoe, Barrie is a beautiful Canadian city home to over 141k people, and growing! Barrie has grown as a bedroom community for Toronto as more people have moved North and take advantage of the easy access in and out of the city via GO Transit.
Another draw for Barrie is that it’s the “Gateway to Cottage Country.” So, for those who enjoy spending their summers by a lake up north, Barrie is an idyllic city to call home.
Barrie is another example of a city that’s gotten on board and is allowing Accessory Dwelling Units (ADU) to be added to residential properties. So Barrie homeowners could theoretically go from a single unit home to adding a legal secondary suite in the basement, and also add a detached ADU in the backyard for a total of 3 rentable units where there used to be one. That’s a massive advantage. Sure, it may be a larger undertaking than many investors want to do, but the possibility of adding additional units to properties will likely be a massive value in the next few years.
The population in Ontario isn’t going away. Ontario has its eyes set on record population growth in the coming years, and places like Barrie are already ahead of the curve by allowing these additions. That’s why owning property in Barrie has so much potential in 2021.
Barrie is another city with a detailed growth and intensification plan, knowing that the city will see massive growth in the next 10 and 20 years.
Average House Price: $588,365
Brantford has a healthy and growing economy. While it largely focuses on family-run businesses, it’s also attracted several international businesses to set up shop in recent years. Brantford is one of the most business-friendly cities in North America, which is helping the city see above-average population growth.
Brantford also has a development plan to take them into 2041. It's necessary as their population is expected to continue to boom in the next 20 years.
In 2017, the city boundaries expanded, which includes 1,830 net acres of industrial employment land slated for development in the next 15 years. The city is scheduling and planning for large economic and job growth in the next 15 years to provide the necessary employment for the population growth that’s coming to Ontario in the next 25 years. People end up where there are jobs, so a city like Brantford that’s adding jobs upfront is a good place to invest because more jobs will likely result in higher population growth.
Average House Price: $577,319
London is located in southwest Ontario, halfway (200km) between Toronto and Detroit, Michigan. Its population in 2016 was almost 384k and has continued to grow in recent years.
According to CBC, one of the driving reasons for growth in the city is that both Fanshaw College and Western University are “actively recruiting” international students. And while international students may have been sent home temporarily in 2020, don’t expect them to stay away.
International students are a massive stream of income for universities and the Canadian economy.
Many of these students apply for permanent residency after completing their studies. Prior to 2017, international students looking to apply for citizenship were required to be a permanent resident in Canada for 4 out of 6 years. Now, with the new law, they are only required to stay in Canada for 3 out of 5 years. The easier process for international students to become a Canadian citizen has already shown an increase in the number of students looking to come to Canada for their studies. This is why London is yet again on our best places to invest in real estate in Ontario 2021.
Average House Price: $530,006
There’s no hiding that the condo market in downtown Toronto had a rougher year than most Southern Ontario Real Estate. But that is no reason to ignore Toronto and the GTA as a whole as one of the best places to invest in real estate in 2021.
Reading headlines, you may worry that Toronto prices are hyper-inflated and ready to burst at any moment. And we may not have a crystal ball, but looking at what’s happening in the country and in the economy, Toronto and the GTA are still solid places to buy in 2021 with the goal of long-term investing.
Even with more businesses working from home, don’t think that the demand for homes in Toronto is going away.
We’ve already mentioned the massive influx of newcomers expected in Canada in 2021 and the following years. A large percentage ends up in the GTA because it’s such a strong international and business hub. Even if companies have more flexibility around work from home, businesses are going to continue to come to Toronto and the GTA, and more and more people will need to have homes in the region.
Toronto has also passed the addition of laneway suites. Even if this may be a smaller percentage of homes that have the ability to add laneway suites, this is the start of great possibilities for Toronto investors.
In November 2020, the City of Toronto started to review the case for the addition of Garden Suites to homes in the city. This would allow accessory dwelling units in far more homes in the city. So, homeowners with extra, underused yard space, could find themselves with the opportunity to add extra value and income to their property.
City of Toronto: $958,200
If so, there's a lot of potential to find good, cash-flowing properties. While these are some of our best places to invest in real estate in Ontario 2021, you can be successful in many communities across Southern Ontario. If you’d like to learn more about investing in real estate, you can sign up for an upcoming 90-minute live training class. We’ll cover investing strategies that are successfully being used in Ontario right now. Plus there will be a questions and answers period at the end of the class.
Are you a new investor, or looking to improve your investing strategy? Check out our 10 crucial real estate investing tips for driven investors.
Want to check our list from last year? Check out the Best Places to Invest In Real Estate In Ontario 2020 here.