Would you buy a property that has negative cashflow?

Would I buy a property that has a negative cashflow?

There has been a recent Toronto Star article about warnings that residential real estate doesn't make sense anymore as the rents aren't rising to meet the carrying costs of the investment.  

Here’s an excerpt from the article: 

“…real estate experts are warning that the investment scene will shift in less than five years as the cost of condos continues to climb at the same time Toronto tenants show signs of hitting a wall when it comes to paying for an apartment.

That will have significant cash flow implications for property investors because rent won’t cover the monthly carrying cost of those units, said Shaun Hildebrand, president of market research firm Urbanation.”

So the question is, would you buy a property that has negative cashflow?  Tune in to see my thoughts on the matter.

Watch below or click here to watch on our YouTube Channel.

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Here’s the Toronto Star article: "Condo prices are set to put many investors in the red as rents fail to meet carrying costs, experts warn"

https://www.thestar.com/news/gta/2020/01/12/condo-prices-are-set-to-put-many-investors-in-the-red-as-rents-fail-to-meet-carrying-costs-experts-warn.html