Best Investment When Your Kid Starts University

So, my kid enrolled in UofT, what’s next?

This is the time of the year all the high school graduates get their offers from universities or colleges, the next stage of their adolescence officially began with the decision of which acceptance letter to take.

As parents, we wonder what’s next? Besides RESP diligently saved tuition, lots of parents help their kids with the biggest expenses which is RENT, for at least another 4 years. 

The average one-bedroom condo rental is about $1700, even with rental reduction from the pandemic. It’s more than part time TA job or $15/hr Starbucks Battista could make after tax.

Some parents choose to help their kids purchase their very first real estate to kick start their financial success. If you are like me, believe the hyperinflation is on its way, then the hard asset of one way to fight against it.

Here is what I remembered vividly:

Back in 2002, my classmate Calvin’s parents bought him a townhouse for 300k so it’s easier for him to go UofT Mississauga, which was sold for 580K 4 year later after his graduation. Calvin rented two rooms each for $500 for the help with property tax and mortgages. He made more than $100,000 in the end. He could become millionaire if he could just simply hold on to the property for another 10 years. 

By comparison, I was renting basement apartment for $700 per month , so I spent $700x 12 x 4 = $33,600 down the drain with ZERO equity built up .

This is my own experience and over the years I sold many condos and houses around universities to help the younger generation build their wealth early .

There are 3 universities and one college in City of Toronto, which are University of Toronto, Ryerson University, OCAD and George Brown College. They all cluster around the core and coincidently it’s the most expansive real estate in GTA per square footage.

I find that a big proportion of my clients tend to hold on to their property even after graduation as rental investment because they could generate both rental income and appreciation of the capital.

With average home price exceed one million in Toronto, Let’s take a look at one of the starter condo around Yonge/ Bloor which is the centre of Toronto and easy to access everywhere because of the two subway lines.

This one is over 700SF and it’s one of the biggest one-bedroom apartment in the area , it also comes with one parking spot. The parking itself worth about 50k and you could rent it out for $200 per month if you don’t need it. It’s a well-managed building with tons of visitor parking, which is rare and premium in that location. Trust me, you don’t want to pay for $30 per day across the street in the Green P parking lot when you visit your kid.

This one is looking for multiple offers next week and with average trading price over $1100 per square foot, it’s more likely to go over 750K.

Please contact me if you are considering investing with your kid in Toronto, I would love to offer my insight and help! Click for Details!

Thanks for reading and invest with the expert!