Real Estate Investing is not for the faint of heart. There are many ups and downs but the rewards can be incredible. The Alex & Brandon Real Estate Team has hands on knowledge as they have experienced first hand what it’s like to be an investor, landlord and property manager. Their connections with local builders, agents and the investment process can help you realize your dreams of being a Real Estate Investor.
Before you buy your first property, determine what you expect from your investment. What are your financial goals? Are you looking for a large monthly cash flow or long term appreciation on the property? If you are unsure how to create these goals, speak to your REALTOR®
Prepare a thorough Financial Analysis
Once you have understood these figures, you should have enough information to determine whether or not acquiring the property fits with your financial goals.
The Key figures you should know are:
Net income/debt financing payments
Return on Investment
Net income/property price
Cash on cash return
Location, Location, Location
That old saying is very important and accurate when it comes to real estate investing. Look for the worst or smallest house on a great street, you can fix and flip this property if it’s in need of updates or you can rent this property to a AAA tenant. Either way, an average home in a great neighbourhood that costs a bit more upfront over a a great home in an average neighbourhood is usually a better investment.
Look at Plenty of Properties
Remember, this is a big investment so don’t just grab the first property you look at. Too many investors don’t put in the time to look at what’s really out there and cost themselves money. Spend the time and put the work into this venture and it will pay itself back.
Forget about Your Personal Taste:
To many first time investors will look at an investment property and say “I don’t like colour of the walls and the carpet”. Forget about what your personal style is and focus on the fundamentals such as price, location, quality and rentability. This home is an investment for someone else to live in and not you.
Don’t look for the Unicorn
Plenty of first time investors suffer from the “a better deal is just around the corner” syndrome. This can backfire and you can potentially let a great deal slip away just because you’re holding out, a perfect deal rarely exists. Advice from your REALTOR® on a good investment should be considered as they are the ones who are the experts in this field.
Understand Tax Implications
The people who run our government want private investors to provide housing for people. That’s because they know if private investors don’t provide housing, then the government will be responsible for it. However, there are many tax implications that you need to know to make this a success. Hire or speak to an accountant and real estate lawyer and become best friends with them.
Keep Proper Records of Income & Expenses
Set up a separate bank account and payment method for your investment. Don’t combine your personal expenses with investment expenses as this will difficult to trace then it comes to tax time. It doesn’t matter whether the investment is in your personal name or under a company name, always separate the two.
Be Careful Not to Buy and Sell Properties Quickly
The Canada Revenue Agency may see this as business income and you’re entire gain will be treated as income (100%) as opposed to a capital gain (50%). It’s advised to buy properties for long term, rent them out and build equity. If you sell years later for profit, the sale will likely be classified as a capital gain.
Hire the Right Agent
One of the best investments an investor could make is hiring the right agent, look for an agent who’s also an investor as they will have learned about pitfalls through their own first hand experience. Do you research, check out the agent’s website, Facebook, LinkedIn, Instagram and online reviews. You will be able to see how this agent does business, whether they are active in the Investment field and how they generally conduct themselves. A bit of homework at the beginning will pay off in the end.
"Alex helped me find and purchase a new investment property in St. Catharines. In a very short period of time he was able to help me locate a property which met my investment criteria. I appreciated his confidence and knowledge in the area as I had many questions. He was very patient and helpful through the entire process. He would often go the extra mile and collaborate with the builder on my behalf to clear up any issues or concerns. I would certainly recommend Alex Winiarski to anyone looking purchase an investment property."Very patient and helpfulPaolo Traverso
"I will sum up my experience by using Mayo Angelo’s words: 'people will forget what you said, people will forget what you did, but people will never forget how you made them feel.' I would not hesitate to recommend Alex to anyone who is looking for an agent who is best in class at what he does."Best in class at what he doesHyacinth Campbell
Alex and Anastassia were an amazing team while we were looking for our condo. Alex with his years of knowledge and expertise and Anastassia with her determination and perseverance helped us find our dream condo in a very tough market. We would recommend them to anyone and will be doing just that. Anastassia went above and beyond for all our first time home buyer needs and questions and even went out of her way to help set up utilities that we were having so much trouble setting up. Anastassia was there for us every step of the way and every time we needed she picked up or got back to us right away. Amazing experience as first time home buyers! Thank you again Anastassia and Alex it was an amazing experience! Look forward to working with you again on our next purchase. Chris Leeder.
"Chris LeederChris Leeder