NexusCrowd Inc

July 13, 2016 10:00 ET

Do Canadians Have Cold Feet Investing in Hot Properties?

Survey Investigates Surprising Attitudes on Real Estate Investing

TORONTO, ONTARIO--(Marketwired - July 13, 2016) - Stories of real estate bidding wars and double digit growth may abound in the media, but few average Canadians feel they have the resources to invest in Canada's red hot real estate market according to a recent Google survey conducted for NexusCrowd, a leading Canadian real estate investment platform.

Although 27.5% of Canadians surveyed said real estate was the most attractive potential investment in 2016, few felt they could afford to get into the market, citing concerns such as 'risk' and the 'size of investment required' to participate. In addition, many Canadians were unaware of the existence of real estate investment opportunities such as online platforms or real estate clubs where a group of accredited investors can share the cost of a property.

Key Findings of the Survey:

1) Canadians believe you need to be wealthy (and older) to invest in real estate:

  • 71.5% of Canadians said they would not be able to invest in a property valued at a million dollars (price of the average residential property in Toronto)
  • 25-34 year olds were even more likely to say they could not invest in a million dollar property (79.8%)
  • When asked about any concerns they had in investing in real estate, the number one answer (at 20.1%) was that the cost of real estate was too high. Not surprisingly, BC residents were most likely to cite the cost of real estate (25.6%). 13.3% of Canadians said they wouldn't have enough for a down payment
  • Other concerns with investing in real estate included too much risk for one investor (11.5%), real estate "bubble" might burst (13.7%) and lack of expertise in the real estate market (9.7%)

2) More Canadians would consider investing in real estate if it were for a smaller amount:

  • Only 14% of Canadians said they would be comfortable investing $500,000 or more in an investment property (the average residential property in Canada is over $500,000)
  • 23.4% of Canadians would be willing to invest 10 thousand dollars in real estate and another 10.8% would invest up to $50,000

3) Few Canadians are aware of real estate investment opportunities in general

  • 53.9% of respondents were aware of investing in mortgages, but awareness of other forms of real estate investments was very low. In fact, 24% of respondents were not aware of any real estate investment options
  • 18.8% were aware of REITs (Real Estate Investment Trusts)
  • Online platforms for private investments such as crowdfunding, had the lowest awareness at 14.9%

"Canadian real estate is an attractive and proven investment opportunity with potential for double digit growth in some markets, but most Canadians feel they simply can't afford to get into it," said Hitesh Rathad, CEO of NexusCrowd. "It's important to be aware of opportunities such as crowdfunding, which allow Canadians to participate in professionally vetted real estate investments for as little as $10,000."

About NexusCrowd Inc.

NexusCrowd is the first investment platform in Canada that provides accredited investors with exclusive access to co-invest alongside established real estate developers and investors in real estate deals that have reached at least 50% of the funding target.

NexusCrowd is led by a team with expertise in financial services, technology and institutional finance. It's the only investment platform in Canada registered as an exempt market dealer that uniquely partners with institutions on equity and debt investments. Combined with proprietary investment and fundraising technology, NexusCrowd provides a simple, transparent process for accredited investors, and a frictionless way for partners to raise new capital. For further information, visit www.nexuscrowd.com.

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