Having a long-term financial strategy is a critical factor in retirement planning. For wealth-savvy retirees, thoughtful investment ventures can provide a strong financial safety net after transitioning away from the workforce.
As long-serving real estate agents in West Toronto, we’ve helped countless clients make strategic investments tailored to their distinct lifestyles and goals.
Here are five real estate investment strategies custom-fit for retirees.
1. Holding Onto Your Existing Home
For many homeowners, retirement marks the transition from a long-held family home into a smaller living space such as a townhome or condo. For investment-savvy retirees, holding onto your family home as you downsize – rather than sell, creates new opportunities for earning quality passive income.
In today’s market, inflated interest rates have put additional pressure on Toronto’s already limited supply of rental housing. As a property owner, you can capitalize on the growing gap between supply and demand by converting your family home into an income property after you’ve moved out.
2. Acquiring a Dedicated Income Property
For retirees who are uninterested in converting their existing home, acquiring a dedicated income property on the market is an equally viable alternative. A tried-and-true investment pathway, purchasing an investment property allows you to capitalize on Toronto’s rising rental rates to earn passive income while simultaneously building long-term equity.
While some investors may have concerns about taking on management duties in retirement, landlord responsibilities are generally quite minimal for small-scale properties.
3. Dual Use Vacation Properties
If you’re a retiree who is embracing a ‘snowbird’ lifestyle, the strategic management of your vacation home can help you uniquely unlock a stream of passive income.
Canadians who own property in the southern United States are already familiar with length of stay regulations. While you may not be permitted to occupy your vacation home for all twelve months of the year, you might have the flexibility to rent it out while you are in Canada. In certain states like Florida, the absence of state income taxes make this a particularly lucrative opportunity.
As you may expect, these opportunities will range based on the jurisdiction in which you own a vacation home. For a better understanding of how you can earn strategic income using your vacation property, ask your real estate agent.
4. Real Estate Investment Trusts
If you’re not interested in property or tenant management, real estate investment trusts (REITs) provide a unique, low-maintenance investment opportunity. For those unfamiliar, REITs work similarly to traditional shares.
Traded on the open market, REITs allow investors to contribute funds to various real estate projects in exchange for returns. One of the primary advantages of REITs is that, unlike other real estate investment ventures, they require little to no personal labour input or upfront capital.
5. Partner With an Expert Advisor
As a retiree, the best path towards a seamless and lucrative real estate investment begins with an experienced real estate professional. In Toronto, real estate is notoriously cut-throat. In order to get a competitive edge against other buyers and investors, you’ll need the insider support of a specialist.
At Christensen Real Estate Group, we’re devoted to helping our clients build long-term wealth through strategic investments. Regardless of your personal or financial objectives, our industry know-how, sharp negotiation tactics, and wide network of market insiders help you achieve an incredible result.
Rather than see you as a number or transaction, we build meaningful relationships and strive to be your long-term advisors on all things real estate. We’ll help you identify lucrative, high-quality opportunities to ensure you’re set up for financial success today and tomorrow.
Article By: The Christensen