How to make money in real estate? That’s a very popular question and has tons of answers! You can literally make money with lots of different options, and each option has multiple ways to execute them. On top of that, you can apply each of those options to different areas of real estate like residential, commercial, industrial, etc. I could go on for a while with these but I won’t. Soooo see ya next week!?
NAAA! I’m just kidding…had ya for a minute though didn’t I? You thought I was going to take my dozens of blog dollars and disappear for ever didn’t you? Actually, I’m just going to touch on a few popular options and a few lesser known options on a higher level. In a future post I’ll break each of them down in greater detail, but for now we’re just going to dip our toes in the water on how to make money in real estate. Read more
4 New Mortgage rules in Canada are coming!
The newest one actually starts today! Sorry for not giving you a better heads up, but hopefully it’s not too late to let you know about the changes that are coming/here. There are currently 4 new mortgage rules that will be coming into effect over the next few months.
Many people maybe wondering why change the mortgage structure? Well, I don’t really know either, let’s look at a few facts about our economy. Canadian household debt to disposable income has risen to 165.3%. This is just slightly less than the all time high of 165.4% in late 2015. Meanwhile housing pricing are going nuts in Toronto, Vancouver, Victoria and Hamilton. All of those cities’ housing prices have seen double digit growth over the past year. Vancouver is seeing a 22% increase! But even with all that, mortgage rates are the lowest they’ve been in a long time. Just like the USA in 2008!…oh wait…I think I see the issue now.
In case anyone doesn’t remember 2008, here’s a graph of the S&P 500 for last half of the year. It was MUCH worse for a lot of smaller companies.
Downsides of being a landlord
One of the questions I get asked most often about being a landlord is What’s the downsides of being a landlord? While there are numerous upsides; 4 ways to make lots of money for starters. There are a few downsides as well. I’m actually only going to talk about one downside in this article as it recently had a perfect ending to it. This downside is terrible tenants.
I know there’s lots of ways to screen tenants and you could weed out the majority of potential crazies but occasionally you might take a chance on a young person with no references and get burnt.
How bad was this person?
Good question! First let me give a little bit of background on how my duplex is run. One of the major selling points for this building for me was the fact that it’s in my hometown, and my father owns the identical adjacent property. They were built together when the original owners built them. He’s owned his unit for almost a decade and has had no issues. He also helps to manage the duplex for me, I’ll post all of the ads and answer all of the emails but the in-person viewings are done by him and the screening of tenants.
Now on to the tenant…
9 Great tax deductions for income properties
Tax season is just about over for everyone and I was able to get a pretty nice return thanks to my tax deductions for income properties. You may know by now that I have two income properties. If not, go and read about my first one which became an income property by accident. When you’re done there you can check out my search for a purpose bought income property. Go ahead! I’ll wait right here!
Why so many income properties?
Well besides the fact they can make you tons money in four different ways, any accountant (always helps to check with an accountant if you’re going this route, they can save you lots of money!) could tell you all about the tax deductions for income properties. Read more
3 Quality Assets to make you lots of money
If you read my article What is net worth and why should I know mine, then you may already be familiar with what assets are because knowing them are essential for determining your net worth. Assets are simply defined as property owned by a person or company, regarded as having value. Popular forms of assets are houses, vehicles and investment accounts (ie RRSP, TFSA, 401k, etc). Less common assets would be jewelry, art, RVs or other vehicles and high end luxury goods. We’re going to focus on the popular assets for this article. In particularly money making assets.
There’s essentially three main types assets to make you lots of money: Read more
As you may have noticed in my Q1 2015 Net worth summary, I had a lot of cash sitting around not working for me. With the Alberta housing market looking like it was on a downward spiral, I didn’t want to buy there just yet. So I decided to look into a rental property.
In February 2015 I was looking at mls.ca like I normally do. I have the tendency to surf MLS at least once a month looking at the prices of homes in all of the areas I’ve lived in. It’s only 4 different areas so it doesn’t take that much time. I don’t know why exactly I do this, mostly just from to feed my interest in homes I think.
This one particular time I was looking at places in Cape Breton, Nova Scotia. It’s where I’m from and where a lot of friends and family still live. If there were opportunities like there are in Alberta, I would think about moving back, but until that time, it doesn’t fit into my financial plans. Or at least that’s what I thought.
This article “A house-poor couple confronts a looming cash crunch” was posted in the Globe and Mail on May 11, 2015. It got a lot of attention on their facebook page and /r/personalfinancecanada on reddit. A lot of redditors and Globe readers feel no sympathy for this couple and think it’s nothing but greed that has gotten them to this point.
It’s extremely hard to feel sorry for this couple even as you start to read the article. Sure maybe by the end of the first paragraph you might be thinking Oh no, a new baby on the way and they won’t be able to afford it! Until you get to the second paragraph and realize that they have a combined income of 128,000 dollars a year and that they purchased a 747,000 dollar home just four years earlier. That’s 5.83 times their gross salary!
If you haven’t read how about my journey to buy this house, you can check it out here – My first house – Buying in a Boomtown
Towards the end of March in 2014 I received some great news at work in the form of a promotion. Fantastic! It came with a nice pay bump, new responsibilities and it also came with a transfer to a different site for a new project. This was a camp only fly-in and fly-out site. Not so fantastic! As you know I had just taken possession of my house just five short months earlier. Now I need to rent it completely, not just the one room.
This transfer took effect immediately. I would be in a camp an hour north of town and would be flying out of an airstrip on one of the work sites. I wouldn’t even have the chance to drop by on my way to the airport to show the house to prospective renters, nor would I be available to deal with any issues that may arise from the renters. My only option was to find a Rental Management company ASAP! Read more
By summer 2013 I was working in the construction industry for two and a half years. I also worked exclusively in northern Alberta in the most booming town in all of Canada, Fort McMurray. There’s a lot criticism about Fort McMurray both good and bad, but it has been nothing but good to me up to this point.
I was in the region for a university work-term during the economic meltdown in 2008. I saw billions of dollars’ worth of projects shutdown almost instantly. But that was 5 years earlier and the town’s housing situation was still recovering. Surely, it couldn’t drop more right?