Now more than ever, the Toronto real estate investor must always be prepared.

The Toronto Real Estate Board’s (TREB) report on the state of Toronto’s real estate market in the first quarter of 2016 paints an interesting picture.

While sales numbers in Toronto’s real estate market continue to soar, the number of properties being listed has diminished significantly. Competition is particularly fierce to the north and east of the city, where properties have been, on average, selling for 105% of the asking price.

In such an environment, there are two strategies for property investors, and both hinge on being ready with a plan.

The first strategy is relatively straightforward, and that is simply to out-bid other buyers. Balancing finance and emotion to win a bidding war in the course of a few hours is tough enough for buyers purchasing for themselves. Investors must in addition be able to quickly identify a property as investment stud or dud before any consideration can be given to bidding.

The second strategy is to find a hidden gem. These are properties which may not present as well on the market, whether to investors or home buyers, but which nevertheless are well-situated and of sturdy construction. They perhaps haven’t been updated in some time, or maybe there is an ongoing issue with an existing tenant. An experienced property manager has the expertise to assess and change the situation, and convert an underperforming property into a sound investment.

Both strategies depend on the investor being ready to pounce. Submitting the winning bid on a turn-key investment means moving quickly, and being ready to handle the ramifications of a selling price that far outstrips the property’s market capitalization. Similarly, while searching for a hidden gem can take patience, it also requires a quick assessment of a property’s qualities, followed by the prompt execution of a purchase and remodeling plan.

Having a plan in place in advance can make all the difference in being a successful property investor.