A new June 2015 report from the Financial Post reminds us that between taxes, inflation and fees, mediocre interest and returns often put Canadian investors in a net loss situation. That means their savings and retirement dollars are shrinking each year. As is the income earning potential of that capital for providing for retirement years. When deposit rates are back into 6 percent plus territory they may be worth considering again. Of course there will be other investment opportunities returning more then as well. The big question is where to find positive returns and safely.
Experienced international investors are plowing hundreds of billions into North American real estate this year. They consider it seriously undervalued. Here are 4 reasons sophisticated global investors are more than bullish on this Canadian asset in 2015
Yield and cash flow are among the top priorities of sophisticated international investors today and there is plenty of Canadian real estate delivering on this. Multifamily and retail properties bring in rents and very healthy returns for direct investors. Many investors are just happy with this alone, but this is only the tip of the iceberg of benefits real estate investment offers.
While the rate of asset appreciation varies over time real estate offers both income and capital growth. Long term capital growth is essential for keeping ahead of inflation and ensuring positive net returns over time. As global investors still see this Canadian asset as being cheap on the world map, and only happy to put more money into it, values should continue to rise.
Whether it is Canadian investors investing in real estate at home, or overseas investors, real estate offers a wide variety of tax advantages which offset gains. This cannot be overlooked. It doesn’t matter how much you make if all of your gain is eaten up by taxes.
The truth is that with so many variable factors in world economics there are few guarantees of performance on any individual investment. Providing investors don’t lose their capital that isn’t a huge deal. They can always ride out a rut. Canadian assets in general stand out on the world stage for security. Real estate compounds that with literal brick and mortar safety.
The Canadian economy is one of the most attractive real estate investment destinations in the world. The stability of its political landscape, economic growth and the vast growth and increase in the service sector makes Canada’s economy an investment haven for real estate investors seeking to cash in by purchasing undervalued assets in Canada.
Canadian real estate offers triple the benefits of many other types of investment. It especially stands out for international investors who see Canadian property as still being dirt cheap. The early investors get in, the more they have to gain. While even in the worst of times this is one asset everyone will be glad is in their portfolios.