Skip to main content

Unsure Where To Put Your Money???


GIC's? RRSP's? TFSA's? RESP's?

Try Real Estate!!!

Is This The Right Time to Buy an Investment Property??
Many of you have asked me that question recently. Now is a good time for me to share with you some unprecedented realities on this subject. The real estate market conditions are very good right now for Buyers and Investors to take that step forward.


1. The Market has cooled down from previous years which means instead of a Seller's Market (More Buyers than Sellers), we are seeing more of a Buyer’s Market (More Sellers than Buyers) now. There are many good opportunities out there now from a pricing standpoint.

2. Mortgage rates have NEVER been as LOW as they are right now. Prime Rate is 3% and “best” 5 year rates are sitting at 4.34%.. Historically when we have seen an adjustment in the Real Estate Market, the interest rates have actually risen. That is not the case now.

3. The Rental Market is currently very robust. Toronto is not only a very diverse city which attracts many corporations and industry, there are very healthy rental market conditions.

4.When looking at building your Portfolio which includes multiple property ownership, we need to focus on monthly carrying costs more than purchase price. Reason being that the key to success here are the carrying costs.

Sample Investment Costing Breakdown

Investment Property Price: $300,000
Downpayment: $30,000
Mortgage Amount: $270,000
CMHC Fees: @2.4% $6,840
Total Financing: $276,840


Principle & Interest @ 4.34% 5yr Term, 35yr amortization .........................15,315.00 /yr... 1,276.30 /month
Property Tax............................ 3,000.00 /yr... 250.00 /month
Total Payment..................... 18,315.00 /yr... 1,526.30 /month


Refinancing of Existing Property

Downpayment for Investment Property........... 30,000.00
Land Transfer Tax ......................................5,700.00
Legal Fees for refinance .................................200.00
Legal fees for Investment property Closing........ 1,300.00
Total.................................................... 37,200.00

Additional Principle & Interest Payment @4.34% 5yr Term 35yr Amortization....................... 2,058.00 /yr... 171.50 /month
TOTAL MONTHLY CARRYING COSTS.............1,697.80/month

This looks like a substantial monthly commitment, Right?

Let’s now look at Potential Income.

Typical 2/3 Bdrm Upper Unit Income..13,200.00/yr...$1,100.00 month
Typical 1 Bdrm Lower Level Income.....10,200.00/yr..$ 850.00 month
TOTAL MONTHLY INCOME.............................. $1,950.00 month

In this Sample “Investment Cost breakdown” you will see that there is a surplus of $252.20 monthly. This amount could be used to Offset your Existing Mortgage on your Principle Residence or Potential Maintenance or simply treating yourself to an Evening Out.

This Sample Investment Cost Breakdown is just an example using average Dollar amounts, ie property price, property tax, etc. Every situation is different so looking for the right property/scenario is important. Feel free to give me a call and I would be happy to help you further your property portfolio.

Comments

Post a Comment

Popular posts from this blog

7 Ways to Make Your Home Cozier This Winter Without Spending

As the temperatures continue to drop, we'll all be spending more time indoors. There are countless ways to make your home feel cozier for the winter if you have extra money to spend, but if you're being mindful of your finances after the holidays, here are some ideas to help you do it without spending. Bring Out the Blankets As the temperatures drop, it’s time to bring out all of those extra throw blankets and quilts you have lying around in storage. Drape blankets over your couches, chairs, beds, and ottomans; fill a blanket ladder and display it in the corner of a room; or fold extra blankets and place them in the corner. Sticking to warm textures such as wool where possible will help to make the space feel cozy. Light Candles Lighting some candles around your home is one of the easiest ways to make your space feel cozy, and who doesn’t have a stash of candles sitting around somewhere in their home? Not only will the flickering light add a sense of warmth and charm, but your ...
Post a Comment
Read more

Bathroom Upgrade Options

Whether you're looking for easy, affordable changes or a major renovation, there are many ways to enhance a bathroom environment. Beyond the basics like decorative colour-coordinated accessories to match curtains, mats and towels, enhanced upgrades like a spa-inspired showerhead and a touchless faucet will add personal comfort and convenience. Depending on your budget, a total makeover might include new tiling. If so, consider a few hand-painted accent tiles to make your bathroom truly unique. More spacious projects might include the addition of a two-sink vanity or a soaker tub.  Bidets are also becoming more popular as they become more affordable. If you don't have the room to add a luxurious stand-alone bidet, some newer toiles are dual purposed, while others can be accessorized with an add-on set attachment for a comparable hygienic experience. No matter what your bathroom makeover budget may be, you can achieve a fresh transformation simply by making a creative paint selec...
Post a Comment
Read more

Apps That Make Selling & Moving Easier

You've probably heard the expression, "There's an app for that!" There does seem to be an app for every conceivable task, and real estate is no exception. If you're thinking of selling and moving this year, here is a list of app types to look for:  Maps - Google Maps is the most popular, but there are others. Mapping apps with satellite views are handy for checking out neighbourhoods.  Calendar - You probably use an online calendar. But, when you're moving, it makes sense to have a separate "moving calendar". There are many free calendar apps available.  Project management - There are some easy-to-use apps that help you stay organized during projects, such as getting your home ready for sale.  Mortgage calculator - Most bank websites feature online tools where you can test out scenarios and see how much you would pay each month.  Moving costs -  Most major moving companies, and a few home improvement centres, feature a moving cost calculator on t...
Post a Comment
Read more