As a Toronto Real Estate Agent , analysing market trends to find good areas to invest has been a part of my job. Our team has been doing it on a weekly basis in the past several years to help our investors in finding the best deals in Toronto’s real estate market. As a result we have screened some of the best places to invest in real estate in Toronto in 2023 for our investors.
In this thorough market review, you can find our top picks of the best places to buy investment property in Toronto. The areas have been categorized by the price range and asset type.
Where to invest in real estate in Toronto in 2023
Average Toronto home price in January 1996 was $203,121 and in the beginning of April 2021 it was $1,083,322. The average residential property prices has been over quadrupled, to be exact over 4.3 times higher that what it was in 1996.
To split it in annual appreciations, it’s about 17% appreciation YoY since 1996! By taking a quick look at the chart below you can see the trend. However in some areas, we had higher appreciation and in some areas lower growth. In this article you’ll read about the areas that we think are the best places to buy investment properties in Toronto in 2021.
Best place to buy an investment property in Toronto for a budget of $500K-$1M
In Toronto’s real estate market the highest pressure is on the properties under $1M, so buyers and investors see the highest demand in this sector. The list below is our top areas to buy property in Toronto for $500K-$1M:
1. Mimico, Asset Type: Condo Apartments:
Mimico is one of the best places to invest in Toronto. If you wanna buy a property on a budget, and get good results in the long run, this is the spot. Mimico is still one of the underrated areas for property investment in Toronto. It’s a mostly new and up and coming neighbourhood. Very close to central Toronto, Downtown, Highpark, and it is on the Lake.
There has been a proposal for a new GO station at Parklawn and Lakeshore, but I personally don’t speculate on that. Without capitalizing on GO station rumors, still this area is one of the best areas to invest in Toronto.
The average price of a Condo Apartment in W01 is $753K but you can get into this area with as low as low $500Ks for a Junior 1Bed. But that won’t last long before the entry level properties go higher than that!
2. Downtown Toronto, East Side, Asset Type: Condo Apartment
In the past decade it has all been about the West side of Downtown. King West is at a high demand now. It’s a great spot to invest in, the Entertainment District or Financial District are all in the West Side of Downtown. All are in high demand, but guess what? The East Side of Downtown is gonna be the next big thing. Especially the Old Toronto and St Lawrence Market Neighbourhood and East Bayfront.
When the West side of Downtown becomes more unaffordable, guess what will happen? The overflow of home buyers who want to be close to the core and have access to all that Downtown Toronto offers, will flood the East Side of Yonge. And it actually started to happen among smart buyers.
The average price of a Condo in C08 ( The East Side of Downtown ) has been $732K, you can get in the neighbourhood with as low as $500K for a decent Studio unit and High $500Ks- Low $600Ks for Junior 1 Beds. The East Side of Downtown has several Pockets that are great places to invest. They are Ranked as below:
A. East Bayfront
B. St Lawrence Market Neighbourhood
C. Jarvis St Corridor ( This is a very up and coming one)
D. Distillery District and Canary District
3. Leaside, Asset Type: Townhomes
Leaside is a great pocket in Midtown Toronto, yet in a very close vicinity to Downtown and Central Areas. Leaside is another excellent area in Toronto to invest in a property. Leaside is very accessible, and has been underrated but real estate investors started to pay attention to this area more than before. Leaside has been under the shadow of Lawrence Park in the North, and Mt Pleasant on the West and Rosedale Valley on it’s South.
With a high price increases in the vicinity, especially Mt Pleasant, the influx of buyers are coming to Leaside, which gives them the same quality of life, and access to great schools. So if you are planning to buy a Townhome, Leaside is one of the pockets that you should not miss.
Where to Invest in Real Estate in Toronto for a budget of $1M-$2M
In this budget range, in Toronto you have more options. Check out our list ranked for 2023.
1. Bloor-Ossington, Asset type: Walk Ups and Older Detached Houses
This one is one of the greatest options if you have some extra cash. The Bloor Ossington area has great transit access, with the proximity of the Bloor Line Subway and Downtown Toronto. Many UofT students, Young Professionals, and Young Couples, can be your potential tenants if you can provide them with a presentable rental unit.
If you wanna buy a ready walk up there, it can cost you around $1.8M to $2M. But if you have a bit extra cash, there might be options to purchase a fixer upper detached in that area for $1.5M to $1.6M and spend around $200K on repairs and upgrades, and make it a 3 dwelling unit ( Triplex), subject to the city of Toronto’s approval. In that case you created A. a Triplex with Cash Flow B. Added Value by renovating the unit to a legal Triplex. This is one of the most favourite ones among our investor clients.
2. Leaside, Asset Type: Detached Homes
As I mentioned earlier, Leaside is a hidden gem that is being discovered more and more every day. Leaside is another great place to buy investment property in Toronto. There is still time to get in this neighbourhood before it keeps up with the other areas. $1.5M to $2M can get you a nice detached investment property in this great area in Toronto. Detached houses closer to $1.5M to $1.7M might require a little bit of love, but they are worth the attention!!
3. Swansea, Asset Type: Fixer-upper Detached or Liveable Semi-Detached
Proximity to Transit, Highway, Park, Lake, and Downtown made this little pocket west of Highpark in high demand, yet still more reasonable compared to other areas such as Highpark and Bloor West Village. In my experience it’s better than Bloor West Village and High Park. It has been all about High Park ( East Side of Highpark). A comparable Detached or Semi Detached in Highpark is around 20% higher than the comparable property in Swansea ( West side of the park). $1.6M to $2M can get you a nice Detached home in this area, which is a great place to invest in Detached properties in Toronto.
4.Liberty Village, Asset Type: Condo Apartments
Liberty Village is an artistic area in Toronto, south of King Street. One of the most important features of this Toronto neighbourhood is that it is very close to the entertainment and fashion gallery of King Street West.
Besides, residents have a great access to the financial core with the help of streetcars. Liberty Village has been a main area for renters who want to find an affordable area for their residence. Also, this developing district has great access to public amenities.
It’s been said that the average condos in this area cost around $400,000.
So Liberty Village is one of the best places in Toronto to invest in real estate!
5. Yorkville, Asset Type: Condo Apartments
Yorkville is one of the upscale neighbourhoods in Toronto, located north of Bloor Street. This Toronto area has one of the most exclusive shopping districts in Canada. This district is full of high-end boutiques and hotels.
Besides, the main offices of IBM and Twentieth Century Fox are located in the Yorkville neighbourhood. The average price of condos in the neighbourhood is $740,000, but since Yotkville is a prestigious area, investors will definitely be fascinated by the results.
During recent decades, this area has been one of the fastest-growing Toronto neighbourhoods. New developments in Yorkville will make it the ultimate residential neighbourhood in Toronto. When it comes to accessibility, Yorkville is a great area since it is located between Gardiner Expressway and Union Station.
If you are looking to a great Toronto area to invest in real estate, Yorkville is one of your choices for sure! Don’t miss this vibrant Toronto neighbourhood!
Where to Invest in Real Estate in Toronto for a budget of OVER $2M
This budget range is more flexible. You can either buy a few properties in great neighbourhoods that I mentioned above this article for under $1M price tag, or you can go straight and buy properties in the below market areas:
1.Bloor St West Corridor and Roncesvalles: Asset Type: Multiplex Properties
Bloor St West Corridor and Roncesvalles are in a very good vicinity of Downtown Toronto. Great Transit access is a top factor for potential tenants to choose a rental unit. These areas have high demand for rental units. If you can get a multiplex, freshly paint and if it’s needed, renovate them, you can expect higher rents that the average for the walk ups in those areas.
Not much inventory available though, sometimes it takes a few months until something investment worth pops up in this area though. So you have to have an eye on the market and ready to close quickly if you want a deal there. The price tags depend on the Net Operating Income (NOI) and the Cap rate, and the general condition of the property. Depending on the property, sometimes we can get a gem with a low cap rate and increase the NOI with a bit of love and attention. For more info about the Cap Rates there, contact us.
2. St Andrews, Asset Type: Detached Bungalows
These areas after April 2017 faced less demand from luxury buyers. However this is changing, mostly because the other parts of Toronto are going high in prices and that wave is going to push St Andrews back to the action.
Now is a good time to get a deal in Detached properties in this pocket with Excellent Schools, Proximity to Highways and Transit. Around $2.7M to $3M will get you a nice Bungalow here. Remember you wanna make money in the future, so St Andrews is a pocket to get in with the cheapest possible detached properties, which are Bungalows. That’s what will have the highest potential in the future.
I don’t recommend buying a luxury and new custom built home in this area YET, unless you are a luxury buyer and would like to enjoy the lifestyle. I assume readers of this article are more Investors than Luxury buyers. If you’re a luxury buyer you’ll require a different guide. You can contact us for that.
3.Rosedale, Asset Type: Detached Properties
This is the crown Jewel of Toronto’s real estate. Doesn’t matter if you are a luxury buyer or an investor. Anything you buy in this pocket ( with the right purchase price ) is worth it. But for investors I highly recommend getting entry level detached properties here, pay some attention and love, then bingo.
This pocket is literally in Downtown, the closest luxury pocket to downtown with greenery and top schools. This is the spot if you wanna spend $5M or up on an entry level detached property. This neighbourhood is well worth it. This is one of the areas that you shouldn’t look at the tag price, you should look at A. The Land Value and B. Scarcity. There is nothing else closer to downtown with this quality of Demographics and Schools and with great access to Transit and Highways.
New money usually chooses Post Rd and Bridle Path, but as a personal suggestion, don’t fall for that. Those areas are already very expensive and I don’t see any great price appreciation in the next 5-10 years. But Rosedale Valley is different. If you can afford that price tag for a single residential property, get in!
Read More: Are Condos A Good Investment?
If you are an investor and looking for deals in Toronto’s Hot Market in the best areas to invest, here you find one of the Best Toronto Real Estate Agents who specializes with investment properties.
In general, real estate is a long run game. Best if you stay in 5 to 10 years before cashing out to see the actual gains.
If you want to buy an investment property under $1M the asset types are usually Condo apartments, and Townhomes in Toronto. If you move from the city of Toronto to areas such as Mississauga, Richmondhill, Brampton, or Durham Region, the are gonna be different asset types and areas for investment. For details about those areas outside of the city of Toronto you can contact us.
If you have a budget of $1M to $2M the options can be more exotic in your investment portfolio. Especially if you are looking for small multiplex residentials, which are great cash flow generators.
For the budgets over $2M, you have many options, but there are also many areas to avoid. Don’t go with what the general consumer goes after. Hire someone who knows what you want and knows the market in and out and can get you the best out of Toronto’s market.
If you are looking for best neighbourhoods in terms of school system in Toronto, here you can find info about the Top 5 Catholic Schools in Toronto and Top 10 Toronto Public Schools.
As a seasoned Toronto real estate expert with years of experience analyzing market trends and providing strategic insights to investors, I can attest to the depth of knowledge required to navigate the dynamic real estate landscape in the city. Our team has consistently demonstrated a keen understanding of market dynamics, enabling us to identify prime investment opportunities for our clients.
Now, let's delve into the key concepts and information presented in the article:
Toronto Real Estate Market Trends:
- The article emphasizes the significant appreciation in Toronto's real estate market, with the average home price quadrupling from $203,121 in January 1996 to $1,083,322 in April 2021.
- The annual appreciation rate is highlighted, averaging around 17% year-over-year since 1996.
Best Places to Invest in Toronto in 2023:
- The article categorizes investment opportunities based on budget ranges and asset types.
- Areas and neighborhoods are recommended for different budget segments, such as under $500K, $500K-$1M, $1M-$2M, and over $2M.
Best Places to Invest Under $500K:
- Mimico is recommended for condo apartments, being an up-and-coming neighborhood close to central Toronto, Downtown, and the Lake. The potential new GO station at Parklawn and Lakeshore is mentioned.
Best Places to Invest $500K-$1M:
- Downtown Toronto's East Side, particularly areas like East Bayfront, St Lawrence Market Neighborhood, Jarvis St Corridor, and Distillery District, are highlighted for condo apartments.
- Leaside is recommended for townhomes, emphasizing its accessibility and increasing interest from real estate investors.
Best Places to Invest $1M-$2M:
- Bloor-Ossington is suggested for walk-ups and older detached houses, with potential for triplex conversions.
- Leaside is again mentioned for detached homes.
- Swansea is recommended for fixer-upper detached or liveable semi-detached properties.
- Liberty Village and Yorkville are suggested for condo apartments, each catering to different demographics.
Best Places to Invest Over $2M:
- Bloor St West Corridor and Roncesvalles are highlighted for multiplex properties, emphasizing the need for renovation to increase rental income.
- St Andrews is recommended for detached bungalows, with the anticipation of increased demand.
- Rosedale is presented as a premium investment area for detached properties, emphasizing the quality of demographics, schools, and proximity to downtown.
- The article encourages a long-term perspective in real estate investment, suggesting a holding period of 5 to 10 years for optimal gains.
- Different asset types and investment opportunities are outlined for various budget ranges.
- The conclusion underscores the importance of having a knowledgeable real estate agent for navigating Toronto's hot market and finding the best investment deals.
- It advises investors to stay invested for the long run and provides additional information on school systems for those interested in family-friendly neighborhoods.
In summary, the article provides a comprehensive overview of Toronto's real estate market, offering valuable insights and recommendations tailored to different budget ranges and investment preferences.