# Magic - Turn 1 Toronto Condo into 3 Condos and $500,000 in 5 Years

Comedy

## Introduction

In January 2013, the average price of a downtown Toronto condo was $ 402,824. Fast forward to December 2017, and that average price had jumped to $ 626,401. By purchasing a condo in January 2013 with a fixed-rate five-year mortgage at just 2.84%, you would have seen significant equity growth over the years.

According to data from RaidHub.ca, by December 2017, the outstanding mortgage on your condo would amount to $ 286,306. With the condo's current value of $ 626,401, this leaves you with a remarkable difference of $ 214,095. This amount represents the equity you can leverage when refinancing at an 80% loan-to-value ratio.

So what should you do with that equity? The answer is straightforward: reinvest it back into the market. With the $ 214,095 available, you can purchase two pre-construction condos for $ 500,000 each. The total investment would mean contributing $ 200,000 (20% down payment each) from your equity.

Now comes the real magic. Over the next five years, the average condo price has previously increased by 9.4% year over year. However, to be conservative, let's assume a 5% compounded annual increase for our calculations.

After five years, the two new condos would appreciate by over $ 276,000. Meanwhile, your original condo would also see an increase in value by around $ 173,000. Additionally, throughout this time, you've been paying off your original mortgage, resulting in an extra equity pay down of approximately $ 55,000.

This brings your total increase in real estate equity to over $ 505,000 after five years! Imagine if the properties appreciated by the average 9.4%. In that case, the total equity change would equal a staggering $ 977,000, highlighting the incredible potential of real estate investment.

This simplified example illustrates how to turn one condo into three properties and generate substantial wealth. If you’re intrigued by the possibilities and want to explore how to transform your current real estate portfolio into a pathway for financial freedom and generational wealth, don’t hesitate to reach out.

As an experienced real estate agent at Remax Condos Plus in downtown Toronto, I am committed to helping you realize your real estate dreams. Let's schedule a review of your portfolio. Call, text, or email me today, and let's embark on this exciting journey together!

## Keywords

- Toronto condo
- Real estate equity
- Mortgage
- Refinance
- Pre-construction condos
- Investment
- Financial freedom
- Generational wealth
- Equity pay down

## FAQ

**1. What is the average price increase for condos in Toronto between 2013 and 2017?**

The average price increased from $ 402,824 in January 2013 to $ 626,401 in December 2017.

**2. How much equity can I leverage from my original condo?**

After five years, you could potentially leverage around $ 214,095 in equity by refinancing at an 80% loan-to-value ratio.

**3. What type of condos should I invest in after refinancing?**

You can use your equity to invest in two pre-construction condos, each valued at $ 500,000.

**4. What appreciation rate should I expect with real estate investments?**

While the average historical appreciation has been 9.4%, it can vary; in this scenario, we used a conservative estimate of a 5% compounded annual increase.

**5. How much total equity increase is possible after five years?**

The total increase in real estate equity could exceed $ 505,000, depending on property value appreciation and mortgage pay down.