Things to consider when purchasing a rental property:
1. Does a purchase make financial sense?
- A minimum of a 20% down payment is required when purchasing a rental property.
- Investing in a rental property should be considered a long-term investment that helps build capital.
- Consider whether your real estate investment has the potential to provide a better return when compared with other investments.
- You will have to pay land transfer tax – this is paid by the buyer when possession of the property is taken.
- When you sell your rental property, you will have to pay capital gains taxes.
- The First Time Home Buyers’ Plan and land transfer tax rebate for first time home buyers can only be applied to your primary residence.