Investing In Kingston Real Estate Market
Kingston is a city in Ontario, Canada. It is located on the north-eastern end of Lake Ontario, at the beginning of the St. Lawrence River and at the mouth of the Cataraqui River (south end of the Rideau Canal). The city is midway between Toronto, Ontario and Montreal, Quebec. Kingston is also located nearby the Thousand Islands, a tourist region to the east, and the Prince Edward County tourist region to the west. Kingston is nicknamed the “Limestone City” because of the many heritage buildings constructed using local limestone.
Kingston is more affordable
Buyers are indeed beginning to look outside major cities more frequently than usual. Real estate speculators suggest the dramatic uptick in those numbers is a direct result of the outbreak. The sudden rise in numbers might be attributable to COVID-19, but the market trended that direction long before the novel coronavirus.
Why? Plain and simple: Canadians can’t afford to live in big cities anymore. They are too expensive. Let’s look at an example. The average cost of a home in Toronto is about $900,000 to a million dollars. The down payment for a home that price runs about $65,000. For a Canadian family to afford a home in Toronto, they would need to bring in more than $190,000 annually.
Meanwhile, the average annual salary in Canada is $44,000. In the Toronto area, the average salary rises closer to $70,000, making the goal more achievable. Still, even a married couple working in Toronto, making the regional average income, wouldn’t be able to afford the cost of a home. That stark reality is forcing more people to leave the city center in search of affordable housing.
Kingston as an accessible point of entry
Real estate investors — especially those operating with a limited investment budget — should be drawn to Kingston for the same reason buyers are. The entry point for the real estate market is substantially lower than it is in major city centers like Toronto.
For example, in Toronto, we said the average cost of a home is around $900,000 to a million dollars. In Kingston, the average cost of a home falls closer to $340,000. That’s roughly a third of the cost of a home in Toronto, and it requires a similarly low yearly income (about $70,000). Home prices in Kingston have a long way to go before they’re in league with those found in larger urban areas.
Still, the cost of a house in Kingston grew 11 percent between January and October of this year. In other words, those people who can work the price disparity between Kingston and Toronto to their advantage can buy into the market at a time when home prices are on the rise.
The ‘midway’ boost
Geographically, you won’t find a city much better placed than Kingston. In addition to lying on the point where the St. Lawrence River meets Lake Ontario, the city is also halfway between Toronto and Montreal. Don’t underestimate this connection. Kingston is about two-and-a-half hours away from the cities, making it an ideal stopover for business travellers and a perfect weekend getaway for city dwellers.
Short-term rental investors should not underestimate the tourism draw of Kingston. The city has a rich history (and the walking tours prove it). It’s also got the right amount of culture to appease travelers hoping to split their time between nature hikes and fine dining options.
As more people move to Kingston, notoriety will increase, too. That increased population combined with the natural hike in tourism could make Kingston a valuable part of your investment portfolio.