Fix flip or Rental?

[pauwo]

New to REI and doing my due diligence "looking behind the curtain" as to which strategies would work in suburbs outside Toronto.



Seems like most investors pick the buy, rent & hold strategy, which I think gives med to longer term income/equity but very little short term cash.



Having little available funds myself even though a good paying job and credit, my original thoughts was to find a couple fixer uppers per year, reno and sell to make some short term cash and then invest in some long term rentals. I am a very handy person and could do some of the tasks myself but already working FT would restrict how much I could do.



Financing either is going to be my biggest challenge but to be honest have not spoken to a broker yet.



My question is does anyone have any success in fixer uppers anymore? especially in the burbs of ON (please no Toronto is dead comments. I am speaking outside Toronto). Is financing harder or easier than rentals?



Any other suggestions to get started that will provide short term income and med term income?



Thanks,





Paul

 

[Thomas Beyer]

Why do you need short term income if you have a job ?



Focus on (tax preferred and tax deferred) networth improvement, then worry about income generation, later.



If you are handy, fix&flip would work. You need money to buy, money to hold with no rental income and money to fix up. This money could come from your own jeans, friends&family, JV partners or the seller of an old house. It takes more work than buy and hold, but generates more equity IF done well.



If you own cows, ask yourself: are you in the milk cow or the beef cow business ? Both businesses work well, but different cows and different equipment is required. Don't confuse the two.

 

[GaryMcGowan]

What GTA areas are you thinking about? I have done my share of reno`s / refi's and flips in the GTA. We continue to use this strategy every day. Remember the biggest key is how you buy. You really only make money in RE when you buy. If you buy right you give yourself a better chance at a profit.



Financing a fixer upper is harder than a personal residence and Fixer Uppers can provide even a greater challenge to finance. It depends on the state of the property. If you would like a can recommend a couple of amazing mortgage brokers that specialize in providing mortgages for investment properties.

 

[pauwo]

Thanks Gary. I appreciate the comments although Thomas has some good points as well.



Little confused on where to focus.



That would be great if you could email me your contacts. My email is [email protected]



Did you check out the REIN event last night> How was it?

 

[bizaro86]

[quote user=ThomasBeyer]If you own cows, ask yourself: are you in the milk cow or the beef cow business ? Both businesses work well, but different cows and different equipment is required. Don't confuse the two.



Replied just to say this is an excellent analogy. I hope it goes in your book.



Regards,



Michael

 

[housingrental]

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