Investing in Private Mortgages in the Greater Toronto Area

Is Investing In Real Estate Right for You?

While the stock market can be volatile, one investment class that has been rewarding Canadians over the long term is the housing market. Real estate has always been an important investment for those living in Toronto and the Greater Toronto Area (GTA).

Because of the limited space, a growing population, and a solid economy, most believe real estate has tremendous long-term growth potential and is less-risky than the stock market. For those who own property in the GTA, they have seen their house valuations rise considerably over the years.

According to the Toronto Real Estate Board, 2015 was a record year for all major home types in the GTA. The total number of properties sold broke through the 100,000 ceiling for the first time ever, with 101,299 changing hands. That represents a 9.2% increase year over year.

In 2015, the average selling price for all homes was up 9.8% at $622,217. The biggest increases came for detached homes. In the 416, the price for a detached home increased 12.6% year over year to $1.04 million. In the 905 area, the price for a detached home was up 12.1% at $728,015. The record 2015 numbers would have been even higher had there been more properties available.

Outside of owning your own home, most people do not have enough money or time to invest in additional properties. But with money managers saying it’s important to diversify within asset classes, it’s pretty tempting to take a serious look at investing in real estate.

Peer-To-Peer Private Mortgages

At today’s valuations, investors need to think outside the box when it comes to real estate. In addition to actually owning a second or third property, investors are turning to real-estate focused equities, including private mortgages and peer-to-peer lending.

Because of Canada’s tight lending rules, a lot of people who want to buy a new home are not able to for many reasons, including a bankruptcy or because they’re self-employed, or don’t have the 5.0% down payment.

A great way to gain exposure to the Toronto real estate market is through peer-to-peer residential real estate mortgages. However, participating in the private mortgage market as an individual investor can be complicated.

Another alternative to buying a property yourself or going it alone as a private mortgage lender is to invest in mortgage investment companies (MICs). MICs provide private mortgages on residential and commercial properties and, by law, they have to distribute 100% of all of their income to investors as dividends.

A MIC exposes investors to the Toronto real estate market and provides them with a steady, recurring, annual cash flow from real estate.

Investing in Toronto Real Estate through MCCs MIC

Mortgage Company of Canada (MCC) is a privately owned company with more than 75 years of industry experience and offers investors the chance to invest in an alternative investment class of a diversified, secure portfolio, and professionally managed Canadian real estate mortgages.

Founded in 2013, MCC has developed a diversified portfolio of over 300 residential mortgages with a mix of investment types across the GTA. As an alternative investing strategy, the MCC MIC has been generating consistently positive returns and has never missed a dividend payment.

To find out how you can diversify your investment portfolio with Canadian real estate, contact Mortgage Company of Canada by phone at 905-886-5352 or 866-318-7222 or by email at investor.relations@mcoci.com.