Condo Now, Freehold Later: The Stepping-Stone Approach to Building Wealth
Why starting small in real estate might get you to your dream home faster.
Buying your first home can feel overwhelming — especially when every listing for that perfect detached house is way out of budget. But here’s something most successful homeowners know: you don’t need to buy your forever home right away. In fact, starting with a condo might be the smartest move you can make.
This approach is called “staged buying” — and it’s helping more and more buyers across the Greater Toronto Area and Waterloo region get into the market early, build equity, and eventually upgrade to a freehold home (like a semi or detached house) without waiting years and years to save.
Let’s break down how this strategy works — and why it could be your best path to that dream home.
Why Condos Are a Smart Starting Point
Let’s be real — home prices in the GTA and Waterloo region are no joke. The average detached house is well over $1 million in many areas. That’s a tough target, especially for first-time buyers.
Condos, on the other hand, are often more affordable, centrally located, and easier to qualify for when it comes to mortgage approvals. For example, a one-bedroom condo might cost $550,000–$700,000, depending on the area — a lot more doable than a million-dollar home.
But here’s the key: when you buy a condo, you’re not just buying a place to live. You’re buying time in the market. That means you start building equity right away instead of watching prices climb from the sidelines.
Equity Builds Wealth — Not Waiting
Let’s say you buy a condo for $600,000 today with a 10% down payment. Over the next few years, two important things happen:
- You pay down your mortgage each month — increasing your ownership share (equity).
- Your condo (hopefully) appreciates in value as the market grows.
If, three years from now, that condo is worth $660,000 and you’ve paid off $30,000 of your mortgage, you now have $90,000+ in equity. That’s money you can put toward your next home — and it grows faster than if you kept saving while renting.
Meanwhile, someone who waited on the sidelines might still be saving while prices kept rising, making their dream home feel even further away.
But What About Maintenance Fees?
Yes, condos often come with monthly maintenance fees — but they also take care of things like snow removal, repairs, and building security. It’s like paying a little extra for peace of mind and less responsibility.
And compared to the costs of maintaining a house (roof repairs, plumbing, landscaping), many first-time buyers actually prefer the simplicity of condo living to start.
The trick is finding a well-managed building where fees are reasonable and services are worth it — something a good agent (hi, that’s me!) can help you assess.
It’s Easier to Sell and Trade Up Than You Think
One of the biggest mental blocks first-time buyers have is: “What if I buy a condo and regret it?”
Here’s the truth: you’re not stuck forever. If you take care of your unit, buy in a good area, and ride the market for a few years, you’ll likely have a solid asset to sell when you’re ready for the next step.
That’s where the strategy really shines — using the equity from your condo sale to help with the down payment on your next home. Whether that’s a townhome, semi-detached, or a fully detached property, you’ll be in a much stronger financial position than if you were still trying to save from scratch.
Staged Buying = Smart Buying
A lot of buyers think waiting until they can “afford the perfect house” is the right move. But in fast-growing regions like the GTA and Waterloo, waiting can actually set you back.
Prices aren’t going down significantly — and while markets fluctuate, the general trend has always been upward over the long run. The longer you wait, the more you’ll likely need to save, and the harder it becomes to enter the market at all.
Staged buying flips the script. You enter now, grow your investment, and move forward from a position of strength.
Real-Life Scenario
Let’s say Sarah buys a one-bedroom condo in Kitchener for $570,000 in 2024 with a 10% down payment. She pays her mortgage consistently and the condo grows modestly in value over the next 4 years.
By 2028, her condo is worth $640,000. She’s paid down enough of her loan that she now has $110,000 in equity. That’s more than enough to upgrade to a townhome or semi in the suburbs — especially with her improved credit and income over those 4 years.
If Sarah had waited until she could afford the $850K semi upfront? She might still be waiting.
You Don’t Need to Have It All Figured Out
Buying a condo now doesn’t mean you’re giving up on your dream of a backyard, more space, or a quiet street. It just means you’re taking a strategic first step.
It’s okay if it’s not perfect. What matters is that you’re investing in your future — and giving yourself a head start, rather than falling behind while waiting for “the right time.”
Let’s Talk About What’s Possible for You
If you’re unsure about whether a condo is the right move, or how to even begin, don’t stress — that’s exactly what I’m here for.
Book a free consultation at harrynaik.com and let’s chat through your options. Whether you’re ready to buy soon or just starting to think about it, I’ll help you map out a plan that fits your goals.
