Pie in the sky?

Return on Investment
By Fabrice Taylor
Globe Investor Magazine, September 18, 2008
Illustration by Remie Geoffroi

Whoever dreamed up the chestnut about investing in land because "they're not making more of it" never met a condo developer. The good earth may be finite, but thanks to so-called strata-title legislation-which allows a building to be subdivided into "lots" and sold to individual buyers-there's seemingly no cap on how many condo units can be built on a single patch of ground. There also doesn't seem to be much of a limit to the number of people ready to buy a condo, which can be a great investment in a bull market. When conditions cool, however, you have to work a lot harder to make a decent return, especially because you'll be relying on rent rather than rapid capital gains. Here are some tips from seasoned condo buyers to help you avoid mistakes.