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Investing Along The Kitchener LRT – Smart or Not?

Investing Along The Kitchener LRT – Smart or Not?

Kitchener LRTThere’s a lot of hype of about the Kitchener LRT and how it will affect real estate prices. Some common questions are, “will prices and demand go up or will they go down? Will it be smart to buy along the proposed routes?

Will my cash flow increase if my rental property is close?”

Investing Along The Kitchener LRT

These are all good questions, and they definitely have valid answers. But there’s a bigger question that should be looked at FIRST before even looking for properties along the Kitchener LRT routes.

What Niche Are We Talkin’ About?

I’ve helped hundreds of local investor’s buy rental properties here in Kitchener, Waterloo and Cambridge. And on top of this, I specialize SOLELY with real estate investor’s here in town. So I’d like to believe that I know a thing or two about investing in real estate and more so, the specific market of KWC (that’s right, I hyped myself up! 😉 )

If there’s one thing I’ve learned after owning a fairly sizable portfolio myself and living here for the majority of my life, is that KWC residents LOVE their cars! And it’s not going to end anytime soon … (like, not even close to soon!)

The cities here are laid out in such a way (stacked upon each other) where needing a car is paramount. For example, if you need to get from the Ira Needles shopping Centre (North West Kitchener) all the way to West Galt, Cambridge, public transit will take over an hour – at the very least! Even with the LRT in place.

Or, you could drive it in 20 minutes – on your time and with the freedom of having your own car. No need to wait for GRT (Grand River Transit) buses to get you downtown so you can THEN jump on the LRT to Fairview Mall only to wait to jump on another bus or two to get you to the Ainslie station – at which point you will obviously need to walk to your desired destination only to repeat the process going back home. There goes your relaxing Sunday!

Can you really imagine a parent dragging their kids while their weekend shopping like this? Not gonna happen!

Also with the super close proximity of the 401, it makes my case even stronger that middle class and above residents will NOT be in a hurry to ditch their cars in order to be close to the LRT lines.

Who’s The LRT REALLY For?

You can now see the probability of ‘working class’ residents ditching their cars for public transit is very unlikely. BUT, the LRT wasn’t intended for them anyway (in my opinion anyway).

So what tenant profile WILL jump on the LRT? Well, your ‘lower income’ tenants such as those who rent Multi-Family and student rental properties will in a heart beat (no disrespect to these tenants by any means! It’s just the way it is!)

THESE will be the LRT’s target clientele and if you want to invest along the LRT, these tenants should also be your target clientele (now you’re thinking like a strategic investor!).

“What About Single Family Properties?”

For example, as you probably know, my main focus is single-family properties. This is what most of my personal real estate portfolio is made up of and it’s what I help my clients with the most as well.

So I have A LOT of people coming to me asking and looking to buy SINGLE-FAMILY properties along the LRT because they read some article from a magazine about buying 800m near an LRT line.

Normally, that’s GREAT advice when we’re talking about Toronto, Calgary and Vancouver. However, every city has it’s own characteristics and in this case, I REALLY don’t believe that’s a smart idea when talking about KWC.

Here’s why …

The LRT line runs right through the most dense and ‘poorest’ part of Waterloo and Kitchener. Now I’m not saying downtown KW compares to Detroit by any means, not even close!

But it’s fair to say that this part of town is not the prettiest and your Single-Family tenants DON’T want to be living there!

These type of tenants want to live in mature and quiet neighborhoods where their kids can play safely. They want the trees, the parks and the nearby plaza’s with low density and so on.

Now I’ve talked about this specific topic a lot on my blog and YouTube channel but long story short, if you want QUALITY SINGLE-FAMILY tenants, you definitely don’t want to be buying near the proposed LRT routes. These areas just don’t attract high end tenants. In fact, you can pretty much ditch 90% of Downtown Kitchener period when it comes to Single-Family properties.

When it comes to these rental properties, we pretty much want to be buying as far away as possible from the LRT routes. I know, not really what a lot of people are saying.

But are they experts in this niche and in this specific town who invest and fill their properties in 2 weeks or less with quality tenants using the system I just described? Didn’t think so …

“Okay, But I Still Want To Buy Near The LRT. What Should I Buy Then?”

Like I said at the beginning, buying near the LRT is VERY smart – If you’re buying the right property, that is …

We know buying Single-Family properties near the Kitchener LRT lines is not the smartest choice. However, buying Multi-Family properties and student rentals in Waterloo along the proposed routes is a GENIUS strategy!

As I said, these will be the customers that will actually use the Kitchener LRT because they’re generally lower income residents who don’t have cars to begin with. That’s why they want to live downtown in the first place. So they can be close to the action and amenities all within walking and transit distance.

These tenants will likely be students, young people (both single and couples) who are starting their lives and careers as well as low income adults. So cater to their needs!

Long story short, there will be demand to be near to LRT routes.

So the closer you can buy, the more demand it will create for your rental. And the more demand for your rental, the more rent you can charge. And last but not least, my favourite thing about Multi-Family real estate, the more your property cash flows, the more your property goes up in value!


Single-Family rental properties near the Kitchener LRT lines? NO!!!!!

Multi Family rental properties near the Kitchener LRT lines? YES!!!!!

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