(Photo credit: Ken Lund/Flickr)
If you thought many condo owners only buy the property as an investment or buy them to flip them, a recent CMHC survey says otherwise.
The second annual Condominium Owners Survey found that among condo owners in Toronto and Vancouver, 83.8 per cent of those surveyed said they own a condo that they live in. Only 16.2 per cent of those surveyed said they own their primary residence and a secondary condo investment.
The majority of condo investors (72.5 per cent) said they only owned one condo investment with more than half of them (53.9 per cent) saying they bought the additional investment unit for rental income. Only 17.9 per cent of condo investors owned two units, while 9.6 per cent of condo investors owned three units or more.
The majority of condo investors (52.3 per cent) are renting out their most recently bought condos, while one third of them (33 per cent) are living in them or have family living in them. There are also some investment properties that have no occupants (7.6 per cent), while four per cent of investors said their property was in pre-sale or under construction.
Condo investors are taking a long-term approach with expectations that they’ll hold onto the unit for more than five years with many of them holding onto the unit for more than six years. The majority of condo investors are satisfied with the number of investments they’re holding since 90 per cent of those surveyed said they didn’t expect to buy another unit within the next year.
There are a few differences between condo investors and condo owners. A greater number of condo owners (45.4 per cent) have owned their unit for more than ten years compared to only 23.7 per cent of investors who owned their property for that period of time.
More condo owners were likely to have no mortgage at the start (28.3 per cent compared to 18.8 per cent), but condo investors were more likely to put down larger down payments of 20 per cent or more (45.3 per cent compared to 31 per cent of condo owners). Condo investors may pay larger down payments since it’s more difficult for than to obtain a mortgage, but there are also many investors (45 per cent) who have no mortgage on the last unit they purchased.
While both condo investors in Toronto and Vancouver had very similar responses to surveyed questions, investors in Toronto were more likely to buy a presale condo compared to investors in Vancouver. They were also more likely to buy another condo unit within the next year.
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