Forbes magazine rankedCanadaas the best place on the planet to do business. TheU.S.came in 10th. As the economic hub of the country, responsible for fully 20 per cent of its GDP,Torontobenefits greatly from such global attention.
Â â€œCanadais seen as a safe haven for foreign investment, especially for middle eastern and Asians,â€ saidÂ Navtaj Chandhoke, founder of World Wealth Builders, a Canadian Real Estate investors training centre. â€œThe appreciation and rental demand also got the attention of Canadian & international Real Estate investors.â€
â€œThe average home price inCanadahas increased by 160% since 1990, mortgage interest rates have decreased by 60%.As a result, over the past decade, the average mortgage payment has increased by approximately 25%,â€œ said Navtaj Chandhoke.
The attraction for investors is simple math: with a market that inÂ recent years has appreciated 8 to 9 percent annually, even theÂ smallest units are an attractive investment. BoughtÂ â€œpre-construction,â€ condos are worth considerably more by the time theyâ€™re built. Itâ€™s estimated that fully 60 percent of the units sold in theTorontoÂ market are snapped up by international investors, many fromChinaÂ andSouth Asia.
There were132 high-rises under constructionÂ inTorontoin September 2011 with another 120 projects in phases of â€œpreconstructionâ€. That is far more than the next most-active centers,Â Mexico Citywith 88 on the way andNew York Citywith 86.
The city is also a major immigration destination. AnÂ estimated 100,000 new residents move into the greaterTorontoareaÂ each year. The growth rate is closer to that of cities in Asia than any inÂ North America. Immigration rules favor migrants withÂ assets. This means that many jump quickly into a housing market that, despiteÂ rising prices, is still a bargain by international standards.
Bank ofCanadaGovernor Mark Carney warned earlier this year that tooÂ much inventory could lead to â€œthe possibility of an overshoot in theÂ condo market” inToronto.Â Canadian Real Estate analysts have been predicting forÂ years the end of theTorontoboom, and so far theyâ€™ve been wrong.
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