Hamilton vs KWC

[BrianJamieson]

Hi folks,

I`m looking for feedback from active investors on the pros & cons of investing in Hamilton vs. KWC. Initially I will be purchasing a series of single family homes in the $175k-$225k price range and am having trouble deciding which area to focus on since both rank well in the Top 10. Feedback on appreciation, tenant experiences, availability of property management and anything else would be greatly appreciated.

Thanks in advance!

Brian

 

[housingrental]

Property and process specific - You can have good or bad experiences in either location

 

[mlwilliamson]

Brian,

I have vetted both areas and have invested in East Hamilton. It realy boils down to numbers and curb appeal. Hamilton is an older city and as many diverse areas, you could get some nice spots for that price range. When it comes to Condo`s, maintenance fee in KWC is a little more. Do your research there is a lot of info on these two regions.

Cheers!



QUOTE (bwjamieson @ Nov 26 2008, 09:50 PM) Hi folks,

I`m looking for feedback from active investors on the pros & cons of investing in Hamilton vs. KWC. Initially I will be purchasing a series of single family homes in the $175k-$225k price range and am having trouble deciding which area to focus on since both rank well in the Top 10. Feedback on appreciation, tenant experiences, availability of property management and anything else would be greatly appreciated.

Thanks in advance!

Brian

 

[Mike Milovick]

Hi Brian;

KW is a hands down better City - and I have looked at opportunities in Hamilton.

KW has hi-tech (think RIM and OpenText), insurance head offices (Clarica, Manulife), and the largest student population per capita (WLU, UW and Conestoga College) in Ontario. I think the area is about as recession proof as you can get. Waterloo is also out of land effectively in three years. Intensification of existing land stock occuring in a big way here. Universities growing. Demographics say another 40,000 people in Waterloo by 2040 (we have 110,000 people here currently - with another 35,000 full time students).

In these economic times, I wonder what a slow down in world wide steel consumption - think Ford, GM, Chrysler - would do to Hamilton? I imagine it would have to be similar to the GM job losses felt in Oshawa these days. Don reminds us not to invest in places where real estate is ""cheap". Do your homework.

I think its a no brainer.

Mike Milovick
Sales Representative
Prudential Grand Valley Realty
(519) 745-7000
Hi folks,

I`m looking for feedback from active investors on the pros & cons of investing in Hamilton vs. KWC. Initially I will be purchasing a series of single family homes in the $175k-$225k price range and am having trouble deciding which area to focus on since both rank well in the Top 10. Feedback on appreciation, tenant experiences, availability of property management and anything else would be greatly appreciated.

Thanks in advance!

Brian

 

[kboughen]

Hi[quote namethese economic times, I wonder what a slow down in world wide steel consumption - think Ford, GM, Chrysler - would do to Hamilton?
If I remember correctly, REIN recently pressented information showing Hamilton as the best in employment diversification. Both are top 10 ten towns for good reasons. Visit both and do your own analyisis. It will become clear to you which one meets your personal investment goals better.

 

[BrianJamieson]

Thanks for the feedback everyone. I`ll be planning trips to both areas in the next few weeks to get a closer look and meet with some folks in the areas.


Brian

 

[EdRenkema]

QUOTE (MikeMilovick @ Nov 27 2008, 09:28 PM) Hi Brian;
KW is a hands down better City - and I have looked at opportunities in Hamilton.

KW has hi-tech (think RIM and OpenText), insurance head offices (Clarica, Manulife), and the largest student population per capita (WLU, UW and Conestoga College) in Ontario. I think the area is about as recession proof as you can get. Waterloo is also out of land effectively in three years. Intensification of existing land stock occuring in a big way here. Universities growing. Demographics say another 40,000 people in Waterloo by 2040 (we have 110,000 people here currently - with another 35,000 full time students).

In these economic times, I wonder what a slow down in world wide steel consumption - think Ford, GM, Chrysler - would do to Hamilton? I imagine it would have to be similar to the GM job losses felt in Oshawa these days. Don reminds us not to invest in places where real estate is ""cheap". Do your homework.

I think its a no brainer.

Mike Milovick
Sales Representative
Prudential Grand Valley Realty
(519) 745-7000
www.TeamMilovick.com

Having properties in both Waterloo and Hamilton I feel slightly qualified to answer and disagree with one of Mike`s points. Hamilton is not a one horse town, steel is secondary to Health Sciences as a major employer in Hamilton. My property in Waterloo is doing extremely well despite a few bumps in the road. I think KW is hands down the best performer on the market today, I also think Hamilton has a very bright future. The plans are being implemented to build several high tech business parks in Hamilton in the next 5 years. The Hamilton EDO is tremendously helpfull and proactive (what does that say?). Now also think geographically, Hamilton is positioned to prosper just in terms of transportation infrastructure alone.
All of this aside I prefer to focus my efforts in Hamilton since it is simply easier and why stop with as bright a future as they have.

 

[Marek2086]

Investing in hamilton myself I would also strongly recommend it. You can easily find legal investment properties and cashflow at $500/mo with 20% down. With the transporation infrastructure in place and McMaster innovation park you can`t go wrong with hamilton. Hamilton is moving up on the top ten I can guarantee it. Also, did I mention we have a international airport.

 

[Mike Milovick]

QUOTE (EdRenkema @ Nov 28 2008, 01:36 PM) Having properties in both Waterloo and Hamilton I feel slightly qualified to answer and disagree with one of Mike`s points. Hamilton is not a one horse town, steel is secondary to Health Sciences as a major employer in Hamilton. My property in Waterloo is doing extremely well despite a few bumps in the road. I think KW is hands down the best performer on the market today, I also think Hamilton has a very bright future. The plans are being implemented to build several high tech business parks in Hamilton in the next 5 years. The Hamilton EDO is tremendously helpfull and proactive (what does that say?). Now also think geographically, Hamilton is positioned to prosper just in terms of transportation infrastructure alone.
All of this aside I prefer to focus my efforts in Hamilton since it is simply easier and why stop with as bright a future as they have.


Hi Ed;

We are both real estate investors. : )

If I am an investor, and I am comparing CMHC rental stats of KW to Hamilton in terms of occupancy and rental rates, its a bit of a no-brainer : )

Mike

 

[EdRenkema]

QUOTE (MikeMilovick @ Dec 6 2008, 06:45 PM) Hi Ed;We are both real estate investors. : )

If I am an investor, and I am comparing CMHC rental stats of KW to Hamilton in terms of occupancy and rental rates, its a bit of a no-brainer : )

Mike


Hi Mike,

I think KW is hands down the best performer on the market today,

So isn`t that just what I was saying.

 

[Mike Milovick]

Hi Guys!Just some more food for thought. A couple of days agao, CMHC came out with their Ontario market rental report. From the CMHC report, you will find:

1. Average rents in KW versus Hamilton about 5% higher in KW.
2. Vacancy rate in KW about 1.8% versus Hamilton at 3.2% (so almost 50% higher in Hamilton)...

Income property pricing are typically more money in KW, but if you can get 5% more income, and are experiencing about half the vacancy, it probably makes sense.

I sleep well knowing where my money is parked.

If anyone knows how to add an attachment, I would be happy to send along the report...

Mike



QUOTE (EdRenkema @ Dec 7 2008, 01:36 PM) Hi Mike,

I think KW is hands down the best performer on the market today,

So isn`t that just what I was saying.

 

[Jack]

QUOTE 1. Average rents in KW versus Hamilton about 5% higher in KW.

How do the purchase prices compare? How do the earnings figures compare?

QUOTE 2. Vacancy rate in KW about 1.8% versus Hamilton at 3.2% (so almost 50% higher in Hamilton)...

It`s a wash either way. Those are odds that I`ll play any day.

All this being said, if I`m investing in Ontario, I`m probably investing in Kingston.

 

[invst4profit]

What info/numbers do you have on Kingston that makes it a better choice.

 

[Jack]

QUOTE What info/numbers do you have on Kingston that makes it a better choice.

-Hasn`t experienced a major run-up in values, indicating stability/efficiency

-Young demographic

-Very stable employment base

-1 university, 1 college

-Location: close to Toronto, Ottawa, Montreal, NY

-Affordable housing ($236K average)

 

[tbarcier]

QUOTE (Jack @ Dec 12 2008, 06:19 PM) -Hasn`t experienced a major run-up in values, indicating stability/efficiency
-Young demographic

-Very stable employment base

-1 university, 1 college

-Location: close to Toronto, Ottawa, Montreal, NY

-Affordable housing ($236K average)


Don`t forget, CFB kingston, several Corrections facilities and 2 hospitals who are major employers (plus many more). Vacancies are down here as with most cities, however our prices did increase over last year. While the market has slowed here, there are still some decent deals to be had, and cashflow is fairly easy to find. Pricing in general has come down a bit, mostly on properites that have been sitting, however I feel its more of a market correction than anything else. People are still buying, just not with a fevered pitch. It is a mixed bag though, some high end rentals (some very low as well) and lots of students rentals. I have not had any problems renting a single unit. If anyone has any questions about this beautiful town, please feel free to contact me. Invest4profit, you are here as well, correct? What are your thoughts?

 

[GordM]

QUOTE (EdRenkema @ Dec 7 2008, 01:36 PM) Hi Mike,I think KW is hands down the best performer on the market today,

So isn`t that just what I was saying.

Just some personal experience .... my properties in Hamilton cash flow very nicely, and properties that I purchased 4-5 years ago have increased in value to the tune of 50% ... economic diversity, huge education and health care industries, growing high tech, growing airport, a multitude of transportation expansion projects, proximity to Toronto and the U.S., population growth, etc etc etc ... not a bad place to be .... I certainly would not hesitate to invest in KWC either though.

Gord

 

[Jack]

QUOTE Just some personal experience .... my properties in Hamilton cash flow very nicely, and properties that I purchased 4-5 years ago have increased in value to the tune of 50% ...

Out of curiosity, if they`ve cash-flowed very nicely, and have appreciated 50%, why not sell them?

One rule that tends to be good to live by when it comes to investments is don`t get greedy. Those values could pull back just as easily as they`ve gone up. Some prominent economists right now are calling this period of time "the calm before the storm", where the real storm will take place in mid-late 2010 and it will persist for the better part of a decade, or even longer.

Just throwing out there the fact that it might be an idea to cash in those 50% paper gains while they`re still available.

 

[housingrental]

Jack - Good reason not to sell is transaction costs are high in real estate. Next good reasons are that it`s a leveraged product tied to inflation - so even 2% nominal annual yearly increases in property values over the next 10 years make it a desirable investment choice for many.

 

[Jack]

QUOTE Jack - Good reason not to sell is transaction costs are high in real estate.

Agreed, but they`ll always be high. That`s no surprise.

I`d be a lot more comfortable eating a $10,000 cost of sale after the asset`s value has appreciated 50%, that`s for sure.

Don`t get greedy...

 

[Lucas]

QUOTE (Jack @ Dec 15 2008, 11:35 AM) Agreed, but they`ll always be high. That`s no surprise.

I`d be a lot more comfortable eating a $10,000 cost of sale after the asset`s value has appreciated 50%, that`s for sure.

Don`t get greedy...

I don`t think recognizing transaction costs is a symptom of greed...its business!

I think it really depends on your business model. If you are postioning yourself to live off monthly cashflow generated from Real Estate then why would they sell...infact you would ALWAYS be looking to buy more properties with good cashflow...I`m sure there are more than a few investors on this forum that utilize this model.

Lucas