Let's face it. Who enjoys paying rent for our kids? Every month you make a payment to a landlord you never see, and then poof, that money disappears and it's gone forever.
So why not purchase and start putting those rent cheques down on the principal of a home? Sure, you're still making that monthly payment, but it's going towards a property that you own. Then, when your child is done University you can sell with 4+/- years appreciation in a market that has continued to grow.
Guelph is continually ranked as one of the best cities in Canada to invest in. With many self sustaining industries, Guelph's 'little bubble' is showing no signs of slowing down. 2018 ranked by MoneySense as one of the top 4 cities to invest in real estate in Canada.
So what are the pros and cons, you ask??
When you’re dealing with students you can rent by the room, which increases your bottom line.
There’s no need for expensive finishes like granite and hardwood; units need to be functional, clean, and well done, but high-end materials won’t give you a return on investment.
An abundance of potential tenants. Your child is most likely going to have preferred roommates, but for whatever reason, if that doesn't work out there is a deep well of potential tenants to choose from.
In many cases you’re dealing with young people on their own for the first time, so you can usually ask that parents co-sign the lease. It makes the default rate very low.
While there’s a high turnover rate, it’s a predictable rental cycle. Leases start and end at the same time every year, which means only having to deal with it once every 12 months
You might only need to worry about renting once a year, but depending on how many rooms you have available, that still means a lot of applications and a lot of screening. Hopefully if you are renting to your child and his/her friends they can be screened and secured in advance!
You have to keep in mind that your tenants are often leaving their parent’s house for the first time and may not know how to deal with simple issues around the house. This means that even small things like changing light bulbs or tripped breakers may result in a phone call or house visit. Teachable moments for your child perhaps!
Hope this brief overview of buying vs. renting gives you a better understanding of the pros and cons in the city of Guelph. If you have any questions and would like to talk further on this topic don't hesitate to reach out.