Shift-4 Posted July 19, 2018 Share Posted July 19, 2018 8 minutes ago, goalie13 said: I hear ya there. I remember when I first moved to the Okanagan and got married. We could have purchased a condo for under $70K. To us, that seemed like a million dollars. Today, a condo in that same building is over $300K. But instead I have a $400K mortgage on a house in Victoria. Had I bought that condo in Kelowna, I would probably be mortgage free by now. I lived in Canmore for 3+ years. If I had have bought something just for personal residence I would have left with at least $100k gain. Ugh. Link to comment Share on other sites More sharing options...
FS91 Posted July 20, 2018 Share Posted July 20, 2018 23 hours ago, riffraff said: I have done exactly this last year exactly. as @Shift-4 mentioned the “write offs” help with the tax. so far the investment has been great as obviously the market continues to grow and my rental property has gone up along with the market. I was able to find a great professional tenant who has a lot of home pride. I have a positive cash flow every month without having to gouge the renter - something I made a point of from the start. I charge a comparable rate. i went small, with a duplex - less maintenance overall. imo. This path to real estate investment is a good one. Is this taking into account you paying your mortgage (interest & principle), property taxes & maintenance? If so I'm curious how you manage to come out cash flow positive. Did you make the initial investment some time ago or have a large down payment? Link to comment Share on other sites More sharing options...
taxi Posted July 20, 2018 Share Posted July 20, 2018 23 hours ago, riffraff said: I have done exactly this last year exactly. as @Shift-4 mentioned the “write offs” help with the tax. so far the investment has been great as obviously the market continues to grow and my rental property has gone up along with the market. I was able to find a great professional tenant who has a lot of home pride. I have a positive cash flow every month without having to gouge the renter - something I made a point of from the start. I charge a comparable rate. i went small, with a duplex - less maintenance overall. imo. This path to real estate investment is a good one. The path to real estate investment was fantastic....3+ years ago. I'd be very cautious about entering the market now. You're also going to struggle to find any cash flow positive investments at this point, unless you have a massive downpayment. To the OP, by taking out a loan on your existing property, you're doubling down on real estate as an investment. Obviously, no one can predict the market, but I wouldn't look at real estate as a guaranteed winner right now. Link to comment Share on other sites More sharing options...
riffraff Posted July 20, 2018 Share Posted July 20, 2018 36 minutes ago, taxi said: The path to real estate investment was fantastic....3+ years ago. I'd be very cautious about entering the market now. You're also going to struggle to find any cash flow positive investments at this point, unless you have a massive downpayment. To the OP, by taking out a loan on your existing property, you're doubling down on real estate as an investment. Obviously, no one can predict the market, but I wouldn't look at real estate as a guaranteed winner right now. Agreed. I mean you and I and most could agree that these statements are heard cyclically. as I have approached this as a long term investment I’m confident it will work out. youre right in that investing right now and hoping for a quick buck is not only a risk but unlikely. But that is often the case. Unless you’re an insider to a developer, quick money is rare. Link to comment Share on other sites More sharing options...
FS91 Posted July 20, 2018 Share Posted July 20, 2018 50 minutes ago, taxi said: The path to real estate investment was fantastic....3+ years ago. Anyone able to speak to the Calgary market? I've been looking online and see a lot more affordable options there. Thinking about possibly making the move out there. Link to comment Share on other sites More sharing options...
riffraff Posted July 20, 2018 Share Posted July 20, 2018 1 hour ago, FS91 said: Is this taking into account you paying your mortgage (interest & principle), property taxes & maintenance? If so I'm curious how you manage to come out cash flow positive. Did you make the initial investment some time ago or have a large down payment? Mortgage, interest, and principal is covered by the rent with just over 300$/month left over which I save for maintenance. As I mentioned I purchased a duplex which required less maintenance than a full-size house. I’m also in the trades and have the skills to do most work by myself. ive spent 385$ this year on maintenance and approx 8 hours of my own time. Link to comment Share on other sites More sharing options...
Shift-4 Posted July 20, 2018 Share Posted July 20, 2018 16 minutes ago, FS91 said: Anyone able to speak to the Calgary market? I've been looking online and see a lot more affordable options there. Thinking about possibly making the move out there. It's where I live. I am tempted to say that it is near bottoming out. I am about to buy a new personal residence. I think I am doing it at the right time. Albeit the 'bottoming out' might last another 12 months. Lots of inventory right now. Link to comment Share on other sites More sharing options...
taxi Posted July 20, 2018 Share Posted July 20, 2018 20 minutes ago, FS91 said: Anyone able to speak to the Calgary market? I've been looking online and see a lot more affordable options there. Thinking about possibly making the move out there. A lot of Calgary's market is dependent on oil prices. Calgary never really bottomed out when the oil prices dropped last time. Low interest rates and more diversification in the economy allowed people to hang onto properties longer and wait things out. Personal debt and government deficit is building though, and if the low oil prices persist, then expect things to get worse. Currently the Alberta government is running a 9+ billion deficit, and a lot of this spending is masking bigger troubles. Link to comment Share on other sites More sharing options...
bishopshodan Posted July 20, 2018 Share Posted July 20, 2018 3 hours ago, FS91 said: Anyone able to speak to the Calgary market? I've been looking online and see a lot more affordable options there. Thinking about possibly making the move out there. Just talked to a friend that's looking at 3 bedroom homes that are sub $400k. That's not much. Link to comment Share on other sites More sharing options...
coastal.view Posted July 20, 2018 Share Posted July 20, 2018 On 7/19/2018 at 9:06 AM, Darius said: Has anyone used a HELOC to invest in a rental property? Im trying to wrap my head around the concept. This is what I know 1. You can borrow up to 65% of the assessed value of your home (on the portion that is paid off already) 2. Using the HELOC you can invest in a rental property 3. HELOC only requires the interest of the loan to be paid in monthly installments 4. Rent out the rental property to at least cover the interest, property tax, strata fee (if any) 5. You can write off the interest on the HELOC Here is where it gets muddy for me 1. The rent you collect will be taxed as income . Does this offset writing off the interest from the HELOC 2. As you pay down the HELOC does the monthly rate of interest decrease or is this set at intervals (say 5 years). Say my HELOC is 300k, and i pay down 4k per month, does the interest the bank want decrease monthly. 3. Is this strategy worth it, or is it better to save for a downpayment and just take out a traditional mortgage? Any thoughts? Edit: yeah I know I should talk to a bank or mortgage broker, but sometimes you get some insight from people that have gone through the process...then I can ask better/different questions... well ensure you read carefully the post of d-money and educate yourself about capital losses as well your investment scenario can be safer if you have something to write losses off against if the capital value of your property takes a hit everyone jumps into the real estate game counting on the market rising i saw the market crash in the early 80s due to interest rate increases it was not a pretty picture Link to comment Share on other sites More sharing options...
luckyjack Posted August 3, 2018 Share Posted August 3, 2018 I think buying a property is great investment. It can generate an ongoing passive income, and it can prove to be a good long-term investment if its value increases exponentially over time. Currently I'm thinking of buying property for sale Bodrum next year. I've already found real estate company in London which offers a large variety of houses and villas in Turkey at affordable prices. Hope they will help me to find a good appartments near the sea. I want to lease it for summer in the future. Link to comment Share on other sites More sharing options...
taxi Posted August 3, 2018 Share Posted August 3, 2018 4 hours ago, luckyjack said: I think buying a property is great investment. It can generate an ongoing passive income, and it can prove to be a good long-term investment if its value increases exponentially over time. Currently I'm thinking of buying property for sale Bodrum next year. I've already found real estate company in London which offers a large variety of houses and villas in Turkey at affordable prices. Hope they will help me to find a good appartments near the sea. I want to lease it for summer in the future. It will only generate passive income if you have a low mortgage. If you are leveraging an existing property to buy a second property, you are doubling down on the real estate market. You could end up underwater fairly quickly. If there's an interruption in your own income flow (ex. losing your job), then you could end up losing both your home and the new property. You're talking about international investment, which is a different scenario. International investment typically will not allow you have a mortgage and requires you to pay cash for everything. I'd be a bit wary of Turkey though, as the political situation there is crazy. This is why property there is cheap, as the country's economy is a mess, and their former ally, the USA is about to impose sanctions: https://www.washingtonpost.com/business/2018/07/13/turkeys-economy-looks-like-its-headed-big-crash/ https://www.bloomberg.com/news/articles/2018-08-03/u-s-sanctions-against-nato-ally-turkey-puts-ties-at-crossroads As for the local market, things aren't looking great either: https://www.cbc.ca/news/canada/british-columbia/july-home-sales-in-metro-vancouver-lowest-in-18-years-1.4771743 I'm not a real estate expert, and no one can predict the future. However, I'd act very cautiously with any real estate investments right now. This should be especially true if you are planning on borrowing money to finance these investments. Not only may a downturn be imminent, but interest rates in Canada will continue to climb. Link to comment Share on other sites More sharing options...
kingofsurrey Posted August 19, 2018 Share Posted August 19, 2018 Buying Real Estate right now is very risky..... The correction started months ago....... Realtor Ian Watt uses the independent figures from SnapStarts Publishing Company, which reports median prices. For July, it shows that prices for detached homes on Vancouver’s west side have fallen 26 per cent in a year, dropping by just under $1 million, from $3.8 million to $2.8 million. In West Vancouver, detached home prices have fallen over 30 per cent or $1.1 million, from $3.6 million in December 2017 to $2.5 million in July. https://vancouversun.com/business/local-business/some-realtors-believe-major-price-correction-underway-in-metro-housing-market?video_autoplay=true Link to comment Share on other sites More sharing options...
riffraff Posted August 19, 2018 Share Posted August 19, 2018 2 hours ago, kingofsurrey said: Buying Real Estate right now is very risky..... The correction started months ago....... Realtor Ian Watt uses the independent figures from SnapStarts Publishing Company, which reports median prices. For July, it shows that prices for detached homes on Vancouver’s west side have fallen 26 per cent in a year, dropping by just under $1 million, from $3.8 million to $2.8 million. In West Vancouver, detached home prices have fallen over 30 per cent or $1.1 million, from $3.6 million in December 2017 to $2.5 million in July. https://vancouversun.com/business/local-business/some-realtors-believe-major-price-correction-underway-in-metro-housing-market?video_autoplay=true I’m working in the South Island. I’ve been in the same subdivision for 18 months. We just finished the fourth phase which included 200+ units. There are 200 more going in as I type this. In fact I just finished working and did so all weekend. This is ONE subdivision. I’d say, including a half dozen townhouse developments there are 600+ family homes.....all brand new. Prices continue to go up and people are moving in before the paint is dry. Link to comment Share on other sites More sharing options...
Alflives Posted August 19, 2018 Share Posted August 19, 2018 5 minutes ago, riffraff said: I’m working in the South Island. I’ve been in the same subdivision for 18 months. We just finished the fourth phase which included 200+ units. There are 200 more going in as I type this. In fact I just finished working and did so all weekend. This is ONE subdivision. I’d say, including a half dozen townhouse developments there are 600+ family homes.....all brand new. Prices continue to go up and people are moving in before the paint is dry. People are friggin’ morons. They are extending themselves too far, because they are fooled by low interest rates. Interest rates will go up (they must) and the real estate business will go into the dumper. Then the wise people with money will buy up properties for pennies on the dollar from the banks, and rent them back to the morons. It’s a cycle of the rich getting richer, and the morons getting what morons always get ... the short end of the stick. Link to comment Share on other sites More sharing options...
riffraff Posted August 20, 2018 Share Posted August 20, 2018 31 minutes ago, Alflives said: People are friggin’ morons. They are extending themselves too far, because they are fooled by low interest rates. Interest rates will go up (they must) and the real estate business will go into the dumper. Then the wise people with money will buy up properties for pennies on the dollar from the banks, and rent them back to the morons. It’s a cycle of the rich getting richer, and the morons getting what morons always get ... the short end of the stick. Cycle is the key word. most developers I speak with say 6-7 year cycles. its worth noting that a lot of homes are now built with a suite downstairs as a mortgage helper. Link to comment Share on other sites More sharing options...
189lb enforcers? Posted August 20, 2018 Share Posted August 20, 2018 1 hour ago, Alflives said: People are friggin’ morons. They are extending themselves too far, because they are fooled by low interest rates. Interest rates will go up (they must) and the real estate business will go into the dumper. Then the wise people with money will buy up properties for pennies on the dollar from the banks, and rent them back to the morons. It’s a cycle of the rich getting richer, and the morons getting what morons always get ... the short end of the stick. When can I swoop in? There is a piece of raw, remote land on a lake I want to buy. It’s either boat in or ATV. Its 270,00. I’ve been told I need 50% down to get a mortgage on it. Looking for all ideas on how to swing it. Link to comment Share on other sites More sharing options...
riffraff Posted August 20, 2018 Share Posted August 20, 2018 47 minutes ago, 189lb enforcers? said: When can I swoop in? There is a piece of raw, remote land on a lake I want to buy. It’s either boat in or ATV. Its 270,00. I’ve been told I need 50% down to get a mortgage on it. Looking for all ideas on how to swing it. 50% for a build mortgage? Link to comment Share on other sites More sharing options...
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