Title

'Investment Opportunities' Category

Waiting To Buy A Home in Wasaga Beach, Collingwood Or An Investment Property In Barrie? Fixed Mortgage Rates Are Creeping Up

Money is still cheap to borrow

BUT fixed rates are moving up. 5 year rates are now at 4.3%. The days of below 4% “seem” to be over. Now is the time to refinance or buy a new home or investment property. Real estate in Wasaga Beach, Collingwood and Barrie is not dropping in price. For the buyers who were taking a wait and see position on prices, well you have waited, missed the lowest interest rates and seen prices NOT fall.

However it is still a buyers market and there are more listings than buyers. In my experience activity is increasing and a more “balanced” market may be here sooner than later.

2 months ago in Barrie near the GO station there were several homes at $200,000 than made great buys as income generating properties. Currently there is nothing under $219,000. I have clients itching to buy but we are waiting for the right deal and ready to make an offer as soon as the listing hits my desk.

The numbers still work:

On a $200,000 home with 10% down, the mortgage payment fixed for 5 years is $868 per month. Add on $250 for property taxes and insurance and the total outlay is $1,113 per month. Rental income will be $1,250 to $1,350. A very nice positive cash flow

First Time Buyers: buying a home makes tremendous sense at the moment for the very same reason it does for investors. At the risk of repeating myself “money is cheap to borrow and its a buyer market.” Don’t miss the boat.

Do You Recognise The 10 Key Factors That Drive Real Estate Values Up? Part 3

Increase value, income, or both

Areas that the investor can directly influence

Highest & Best Use:
This means that the real estate is being used to its maximum potential. Certain experienced investors may develop a warehouse into apartments or an old office building into condominiums.
he newer investor can also profit from less ambitious changes.In Barrie near Georgian college a 3 or 4 bedroom home may rent fro $1,250 to $1,450 BUT each bedroom could be rented individually for up to $600 or $650  potentially doubling the income.

Top Quality Marketing & Presentation:
Unlike the Kevin Costner film with the mantra “if you build it they will come”, investors can increase their profit by actively marketing the property and achieving above average rents.Adverts and viewings need to make potential renters fall in love with the home and be willing to pay more to live there. Changing light fittings, a lick of paint and steam cleaning the carpet are all relatively inexpensive ways of creating that WOW factor. Nearly everyone I meet has seen the transformation programs on HGTV that help sell a house. The same principles appy to renting a house.

Sweat Equity:
Simple renovations and cosmetic changes can vastly improve the value of a house. Find a well built but somewhat neglected property and buy it below market value. Even better if it is in an area that is just about to boom ( the tell tell signs to look for  in a previously run down area are an increasing number of homes showing pride of ownership and more newer cars.) The investors own labour and ideas can increase the value  so that a higher rent is achieved or the house is sold for a considerable profit above and beyond the normal market increase.

Do You Recognise The 10 Key Factors That Drive Real Estate Values Up? Part 1

Do You Recognise The 10 Key Factors That Drive Real Estate Values Up? Part 2

See How Easily You Can Find A Renter In Barrie,Wasaga Beach Or Collingwood

Its all in the advert

The number 1 concern I hear from all potential real estate investors is  “what if we don’t find a renter.”  Research and due diligence will ensure that the correct property is purchased in the right area and it will rent out;I cannot recommend Barrie enough.

An effective advert will attract more interest and higher demand can increase the rental achieved. At the very least the property will be rented faster.

An attention grabbing headline is essential. 75% of buying decisions are made at the headline alone.

• Use good quality photos of the property inside and out. Take a large number of pictures and use the best. These MLS disasters show all landlords ( and sellers) what NOT to use.
• Use descriptions to make the renter WANT to live in the house. Rather than just stating “air conditioning” try “air conditioned home ensures you are comfortable all summer.”
• Be clear on what is included in the rent and what the renter will also have to pay for e.g. hydro gas etc.
• Include all contact information: email, telephone number, mobile number.
• Do not be negative; “pet free home” rather than “no pets.”

The body of the advert:

• Include all the relevant property information:  fridge, stove,dishwasher, microwave, washer, dryer, type of heat, air conditioning, garage and or parking, deck, shed.
• Include information on the local area:  schools, parks, transportation, shopping.

Viewings should be easy if the renter arrives feeling very positive about the home. Be punctual, professional and point out all the positive features.

My clients have had huge success with Kijiji.com when finding tenants and it is FREE to advertise. It is also worth using these ideas depending on the market being targeted:

• Students: advertising on notice boards at colleges or universities.
• Young Professionals: free networking sites such as Twitter or Facebook.
• Young Families: noticeboards at local community centres that run children’s classes or daycare centres.
• Seniors: wherever there are senior orientated activities in the local community.

Do You Recognise The 10 Key Factors That Drive Real Estate Values Up? Part 2

Real estate values can go up or down depending on 10 major events

The final 3 factors we have no control over:

The Political Climate:
Real estate investors are looking for a business friendly environment with minimal income and property taxation. Also a fair landlord and tenant structure. A town such as Barrie that attracts new jobs and investments.

Transportation Expansion:
Improvement in transportation means more accessibility, accessibility means a growth in population and therefore more demand for real estate. This demand means increasing property values and less vacancies for landlords.

Transitional Areas:
Look for areas that are moving up from 1 economic class to the next. These areas normally have a mix of more run down properties and also a  significant number that have been fixed up. Plus a number of new build developments.
Likewise there will be a mix of older and newer more expensive cars. As the area improves the number of new cars will increase.
The key is to buy in these areas when prices are still low but the “gentrification” has started and is obviously going to continue. The less diligent investor will miss the boat and buy in these areas because of past results not potential.

Do You Recognise The 10 Key Factors That Drive Real Estate Values Up? Part 1

Do You Recognise The 10 Key Factors That Drive Real estate Values Up? Part 3

Do You Recognise The 10 Key Factors That Drive Real Estate Values Up? Part 1

Buy in an area that has a future not a past

Many investors make the mistake on investing in a city or town based on past performance. The successful ones look for potential.  Real estate values can go up or down depending on 12 major events.

4 factors we have no control over:

Mortgage Interest Rates:
Low interest rates will drive values up and will keep an investor’s expenses down. BUT low rates also allow more renters to become home owners and therefore increase vacancy rates. An increase in rates can be a good thing for a landlord.

Increase In Average Incomes:
As average incomes increase, real estate values will move upward. Look for towns where the average income is increasing faster than the provincial average: real estate prices will then also increase faster than the provincial average. Note that it is the rate of increase in income not the actual amount. Even if the income is currently low, if the rate of increase is above average then prices will increase at a faster rate and equity will be built more quickly.

Increase In Population:
Supply and demand! Make sure that the increase in demand is due to the population growing. In cities such as Toronto this can be due to immigration from other countries. In Wasaga Beach, on of Ontario’s fastest growing towns, or Barrie people are moving from other areas of Canada. This demand will drive real estate prices up. New jobs or major new business moving to an area are a great sign of future increase in demand.

The Ripple Effect:

When a specific area has a boom in prices then the real estate in the surrounding areas will follow. This can be on a large scale such as the relationship between Barrie and Toronto or even in a neighbourhood; the east end of Wasaga Beach has several new subdivisions being built and these more expensive homes will increase the value of those in the surrounding streets.

Do You Recognise The 10 Key Factors That Drive Real Estate Values Up? Part 2

Do You Recognise The 10 Key Factors That Drive Real Estate Values Up? Part 3

Are You Prepared To Profit From A Boom In Real Estate??

“We simply attempt to be fearful when others are greedy and to be greedy when others are fearful.” Warren Buffett, Forbes richest person in the world February 11th 2008

Logically we all know that investing in real estate makes sense. We all feel happy with the equity in our home. Why not invest in an income generating property?

Emotionally the majority of people are fearful of taking the first step.”The time isn’t right.” “There’s a recession on.” “House prices are falling.” There are always a hundred and one excuses for not doing something.

Historically real estate has always increased in value. It is not a steady increase, there are ups and downs but over the medium to long term it is “safe as houses.” With a renter paying the mortgage then the ups and downs do not matter. The house is paying for itself and the landlord can sell or better still refinance when the time is right.

Another “Boom” will happen. Start investing to be in a position to profit from the boom.

The current “Buyer’s Market” may make this the ideal time:

1) Interest rates have dropped to historic lows.

2) Sellers are more flexible and willing to negotiate on a sales price.

3) The inventory of available properties is plentiful. There are multiple properties to look at and here is no need to be rushed into making a hasty decision.

I have had the pleasure of proving the above points with clients in Barrie recently ( quoted in the February 2009 edition of “Canadian Real Estate” magazine as a “Cash-Flow King”.)3 weeks after closing tenants had moved in paying $1,275 per month on a house bought for $200,000. we There are a number of properties available from $180,000 with monthly rental of $1,100 upwards. The rates are even better in the student area where houses are rented by the room. If anyone would like more information and accurate figures on ROI please do contact me.

“The best time to plant a seed was 20 years ago. The second best time is now”  Chinese proverb.

Who Else Wants To Rely On Their Pension?

This statement caught my eye whilst reading The Globe and Mail on Friday May 8th. Under the headline “Ottawa to GM: Cut Costs Or Be Cut Off” it was reported that:

“GM Canada’s pension plans had a shortfall of $4.5-billion as of the most recent public information in November, 2007, but that has almost certainly ballooned to $6-billion or more based on declines in stock markets last year.”

Now would you rather invest in an income property or rely on your pension??

What Everyone Ought To Know About Investing In Real Estate.

Why are income properties the best investment??

1. Cash Flow
2. Control.
3. Appreciation.
4. Leverage.
5. Refinance.
6. Asset Protection.
7. Hedge Against Inflation.
8. Physical Asset.

Cash Flow

A positive cash flow means you collect more money (rent) than it takes to pay for and operate the property. This happens every month as long as the right property is purchased. A big advantage over other investments. Leverage means that the cash generated by a real estate investment will always produce a much larger percentage cash on cash return than any other investment.

Control

Real estate is something you can control.  I became very fed up giving my hard earned money to a financial adviser who invested it where he or she thought best but with no real accountability. The investment was completely out of my control. Read the rest of this entry »

How To Achieve Financial Freedom

“Real Estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full and managed with reasonable care, it is safest investment in the world.”
-Franklin D. Roosevelt, former US president.

Financial Freedom

We all dream about it. Millions of lottery tickets prove we want it.

• Freedom to spend more time off  with your family.
• Provide a good education for your children.
• Better health care,
• Live the life you want to live.

Wealth Doesn’t Have To Mean Greed.

Successful property investment is no longer the preserve of the privileged or wealthy. Anyone can build a property portfolio. Everyone expresses an interest in income property. But as we know talk is cheap. Expressing interest is one thing but taking the actual first step is something entirely different.

Why Is Real Estate The Best Investment?

1. Cash Flow.
2. Control.
3. Appreciation.
4. Leverage.
5. Refinance.
6. Asset Protection.
7. Hedge Against Inflation.
8. Physical Asset.

The real estate markets are not as volatile as stocks and shares.Everything is slow and measured. It is a product we all understand. Many of us have built equity in a home far greater than any savings. Now the next step is to have someone else pay the mortgage, provide a monthly income AND build up that equity.

If you are interested in building a property portfolio, in the financial freedom that income properties provide, then please do contact me for a very informal discussion about what is possible and how.

The 2nd GO station Is Good News For Barrie Real Estate

“Cash-Flow King” For Property Investors.

A description of Barrie, Ontario in the February 2009 edition of “Canadian Real Estate” magazine.The April announcement of a second GO station in Barrie as part of the federal and Ontario governments  $213 million  improvements to GO Transit can only reinforce this.

Work should start this autumn on the new GO rail station in downtown Barrie on the former Allandale train station site. It is expected to be completed by 2011.

The return of the Go train service to Barrie increased the growing demand for property in the whole region.It is no wonder that the ROI (return on investment) makes the city such a favourite for property investors.The ripple effect was felt in Wasaga Beach as well as the train service made it possible to live in a lifestyle area but still have easy access to the Central Business District in Toronto.