Invest in Real Estate What you should think about first how to get started

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Information about Invest in Real Estate What you should think about first how to get started
Real Estate

Published on March 6, 2014

Author: cvergaraamigo



These are some things you should be thinking about when you want to get started in investing in Real Estate. There are many ways to get into the market and many things that you have to take into account before becoming an investor, landlord or developer. Area is important but not the only thing. The main topics are financing - mortgages, area, and your own personality.

INVEST $$$ Cristian Vergara “Your AMIGO in Real Estate”

BACKGROUD     Over 20 years experience Over 15 Years investing personally Large percentage of clients are investors Member or past member of:     REIN: Real Estate Investing Network DREI: Durham Real Estate Investing CCIM: Certified Commercial Investment Member Landlord Self Help Centre

WHY DO IT?  In the long run it is like someone paying for you RRSP’s

WHAT KIND OF INVESTMENTS ARE THERE? (RESIDENTIAL)           Fixer Upper and Flip Fixer Upper and Rent Move in condition and rent, positive cash flow Move in condition and rent, negative cash flow because of gambling on future price increases Single family, convert to duplex, either with basement apartment or full conversion Single family with a basement apartment Rent by rooms Multiplex, under 6 units Multiplex 6 units and above Commercial bottom and apartment top

WHAT TO CONSIDER WHEN CHOOSING THE T YPE OF INVESTMENT  The type of  The type of work with  The type of  The type of  The type of person you are, personality people you are willing to work with or would like to time you would like to dedicate to this work you would like to dedicate to this property you would like to hold in your portfolio

THINGS TO CONSIDER, TO DETERMINE THE KIND INVESTMENT YOU ARE LOOKING FOR:  Patience to deal with tenants, some have the possibility of a little more issues than others.  Economic backing, do you have the money to renovate?  Can you hold onto the house without renting it while you are renovating  Are you an experienced landlord  Do you have a commercial background  Do you have a construction background  Do you have a decorating background  Do you like renovating  How hands on to you want to be with tenants  Is cashflow the most important thing, or is it long term growth  Do you want to be a full time property manager  What kind of tenants do I want  What kind of return on my investment am I looking for.

THINGS TO CONSIDER TO DETERMINE THE AREA TO INVESTMENT IN:  How close is the area to you, just in case you have to do repairs, collections and renovations  Are the prices increasing, stable or decreasing in the area  How familiar are you with the area  What kind of growth is scheduled for the area.  Are there lots of renters  What are people looking for to purchase or rent in the area  Do you like the area  What kind of tenants are in the area.

WHAT KIND OF RETURN AM I LOOKING FOR?  Lately lots of residential investments are giving about a 6% Cap Rate?  Gross Income / Investment Price  This is a quick way to start of f judging an investment

IF I AM FLIPPING, THINGS TO CONSIDER: How long can I af ford to hold onto the proper ty What is my budget for repair s/decor and renos How quickly can I get my crew there How much of a downpayment will I be using to purchase, over 20% or will I be using a high interest 2 nd mor tgage.  What happens if I can’t get my price on the resale?  Do I know my tax implications you will have on your profits  Take into considerations that if you purchase with CHMC here are some of the costs          1-2% land transfer tax 2.75-3.3% CHMC/Genworth insurance costs About $2000 closing costs 5% selling costs $700 closing costs  You also pay capital gains taxes on 50% of the gain, to be confirmed with account .

HOW MANY PROPERTIES CAN I OWN?  Normally 2-3 single family residential are easy, after that the financing becomes a little more creative.

WHAT HAPPENS IF I HAVE QUESTIONS:  I will be there to guide you throughout the process, and I you can contact me for advice.  There are also many government agencies and web sites that will assist you with advice and information, such as :  The landlord Self Help Centre  The Government of Ontario Landlord and Tenant Board

HOW DO I RENT OUT THE PROPERT Y AND MANAGEMENT IT:  Depending on where the property is and the type there are many ways to advertise it and list it with public agencies that will assist you for free.  Regarding the property managing, I would suggest that you do this yourself for the beginning.  I will always be there to guide you, or I can do all of this for you.

LET’S SEE WHAT YOU BEST OPTIONS ARE         Houses Flips Plexes Rent to Own Students Rooming Houses Condo Flips And much more

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