4 ways to win as a Toronto real estate investor

Real estate investment is becoming more popular in Toronto, with over 25% of Ontario homebuyers being investors. There are four ways to win as a real estate investor: passive appreciation, principal recapture, active appreciation, and cash flow. Passive appreciation refers to the steady increase in property values over time, especially in areas poised for growth. Principal recapture occurs when a tenant's rent is paying down the expenses, reducing the mortgage. Active appreciation happens when property improvements increase the value of the investment, attract better tenants, and improve resale value. Finally, cash flow occurs when the rent received exceeds costs, though this is challenging in Toronto's current high-value market. Nevertheless, negative cash flow can still contribute to an investor's wealth through equity building and tax write-offs.