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Windsor properties?? novice investor

Casey01

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Jan 17, 2018
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I am looking for the best area in Canada for purchasing rentals. I am currently looking to Windsor but I am novice investor so my view on real estate is a bit deem. I would appreciate any advice in that respect. Also is it a better idea to purchase commercial rentals as opposed to family rentals?



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Thomas Beyer

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Windsor clearly is NOT the best area in Canada to buy real estate, especially with NAFTA under review.

What does "best" mean for you ? Highest cap rates ? Lowest vacancies ? Highest cash-on-cash ROI in a flat market ? Highest total return incl asset appreciation and mortgage paydown ? Highest risk adjusted total return incl asset appreciation and mortgage paydown ? Is a downtown office tower with a 4% CAP rate and 100+ tenants better than a single tenant sub-urban industrial building with a 10% CAP rate ? Is it better than a 5% CAP rate apartment building in Montreal ? Or an 8% CAP rate multi-family building with a leaky roof in Windsor, ON ?

Commercial vs multi-family is not better, or worse, it is just different. Like eating pizza, fish or a schnitzel, which can be good meals, while others prefer vegetarian food.

Commercial is generally better when fully occupied by quality tenants, but often it takes many months to years sometimes to find good tenants.
 

David Wilson

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NAFTA has the potential to hit automotive manufacturing industry hard, if the US gets their way it will hit this industry hard. Windsor is heavily tied to automotive manufacturing so there is a level of uncertainty about the future of Windsor’s economy.

Windsor’s recovery and growth since the 08 recession has out paced the provincial growth. Housing values have been on the rise, so if you bought now and NAFTA has a negative impact on manufacturing you will likely see a hit to Windsor’s economy and house values. Meaning you would have bought at the top of the market only to see house values drop. Of course this is just speculation, but other areas in Canada / ON. don’t have to consider these factors and may be a more stable investment.

It may be prudent to see what happens with NAFTA before investing in Windsor. All depends on your comfort level with uncertainty.




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kfort

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Casey, you may find it useful to have a read through Don’s R.E.I.C 2.0 book.

Depending on your background some of the above terminology may sound a bit confusing but the book is a good place to start overall. This forum is also quite useful. I think there may be a glossary of terms around here somewhere ... though there are almost unlimited nuances to real estate investing the fundamentals really aren’t as complicated as they sometimes seem.


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