Should investors focus on purpose-built rentals or condo units?
Quick Answer
Short answer: Purpose-built rentals offer higher yields (5.2%) but require more capital; condos provide easier entry at 4.7% cap rates.
Detailed Explanation
New-build rental apartments in areas like Bonnie Doon or Mill Woods yield 5.2% cap rates but demand $2M+ minimum investments. Resale condos offer lower barriers ($185k average) at 4.7% yields, though condo fees and special assessments add complexity.
- Purpose-built rental vacancy: 1.9% vs condo rental 2.8%
- Financing: purpose-built gets commercial rates, condos residential
- Liquidity: condos sell faster than apartment buildings
Disclaimer: This page is for general information only and does not constitute legal, financial, or real estate advice. Always verify details with a licensed Alberta REALTOR®, mortgage professional, or lawyer before making decisions. Buy in Edmonton assumes no liability for actions taken based on this content.
Tim Grover, RE/MAX Excellence • 780-288-5144 • 5607 199 Street NW, Edmonton, AB
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