Don't own any RE. I do know a few people who are landlords and under the right conditions it's something I'd consider if the right opportunities came along. Not interested in doing handy work or dealing with tenants so would have to team up with someone who has those skills, possible candidates have come up from time to time. The argument has been made that investing in REITS takes all the extra work out of it but one notable issue is that rental income creates RRSP room(and the tax free compounding that comes with it) while investment income doesn't. As someone with very low RRSP room this appeals to me along with the potentially higher returns if one is well organized(as JaG appears to be). No interest in the current RE market climate but would be nice to be prepared if the right conditions show up. Plenty of idle cash waiting for distressed assets. Lots of questions for JaG, plenty to learn.
Under what conditions would you need to do this? What would be the repercussions(bankruptcy?)? Are investment loans treated differently from owner occupied ones? I thought walking away was very dificult in Canada as compared to the U.S. but don't understand what's involved.Just a Guy wrote:When they are appraised for financing, I usually get about 30% higher appraisals in this conservative market to achieve 100% financing (none of my money is at risk, and I don't use CMHC…my credit rating is at risk however if I had to walk away).
Do you hire property management companies or outside help to perform maintenance when tenants have issues? My current (amateur) landlord lives in another city and it's very costly for him to hire trades when issues come up.2) I avoid the risk of local downturn by investing all over, not just in one city.
Without leverage. You mentioned having none of your own money in the properties, what's your leverage to equity ratio? That would seem to increase risk considerably. If I ever become a property investor it's unlikely I would get much if any financing, not a fan of debt. I figure a cash heavy investment is going to be most appropriate when rates are rising and many of the marginal (amateur) investors bail out at once.Of course, people would be laid off (paycheque won't be safe, the market would tumble (stocks aren't safe), and businesses would close), so what exactly is safe (people still need places to live, making that less risky than the other three).
Do you own anything in Qc? If so, what are your thoughts on the regulatory framework?
Thanks for any insight you can provide, enjoy learning from those with different experiences.