Hi there,
My name is Tristan, and I am a first time poster. I have been frequenting these forums for a few months now. I have been intrigued by the proposition of investing in real estate for quite some time, and it seems now would be the most advantageous time to invest. I`m currently reading The Canadian Landlord`s Guide, and intend to purchase Don Campbell`s book in the near future. I am always looking to further my knowledge within this field.
I have several questions to ask myself and others in this particular field before I commit to buying anything. I have a few different routes I am hypothesizing - a few of which I am uncertain of their likelihood of success. This is where I need council.
But first, some information on my position and what I expect to achieve.
I am 23, I have a modest full-time income, with the hopes of owning my own home and managing several income properties. I eventually intend to be an entrepreneurial home inspector, obtain Registered Home Inspector status and strengthen my position within the real estate market. I currently do not own a primary residence, as I am still living at home. My credit is meager, but all my bills are paid on time.
Now on to business. My first potential business acquisition involves my father as a business partner, and the area of interest is Cambridge/KW. He has agreed to use a HELOC to secure a mortgage, as my equity/professional insecurity likely cannot establish a mortgage. The deal I think that would best suit my father and I`s goals is after we compound and calculate our numbers, my father receives all the positive cash flow from renters, as he requires income towards his pending retirement. We pay a minimal deposit(5-10%), divided equally. When we decide to sell the estate(which has hopefully appreciated), I receive a higher margin on my return(say, 60%/40%) to compensate for my loss on the positive cash flow.
Now before you critique my intended plan, understand that my father and I have different financial objectives. He is looking for the positive cash flow, where I can afford to invest very little in a deposit and bank on the equity of the house in years to come. Obviously, for all of this to work, the numbers must work. We have time to do the exact math and find the ideal location/tenants, as we will likely purchase this invest in the spring. Management will be a shared responsibility, and the property I am keen on at the moment would be a brand new condo. I look forward to the peace of mind the 7-year Tarion warranty brings.
There is one issue I foresee - Repairs. As my father will receive all the positive cash flow, it would be counter-intuitive for myself to pay for inevitable repairs out of my pocket. Any ideas on how we could potentially compromise in a situation such as that?
My second potential endeavor is to do things the traditional way - solo. I fully intend to purchase my own estate to rent, however I`m worried that if I were to become an entrepreneur, I would have a hard time getting approved for a mortgage. What do lenders look for when accepting applicants? Also, I will eventually want my own property as I previously mentioned, and how difficult is it to acquire a second mortgage? Are their any stipulations involved when already in an existing premature mortgage agreement?
I apologize for the long-winded essay. I have had time to read and observe, but I figure I need some questions of my own answering. Any/All input and suggestions are greatly appreciated. Please keep the comments constructive, as I am still trying to absorb the enormity and complexity that is real estate.
Thanks.
Tristan
My name is Tristan, and I am a first time poster. I have been frequenting these forums for a few months now. I have been intrigued by the proposition of investing in real estate for quite some time, and it seems now would be the most advantageous time to invest. I`m currently reading The Canadian Landlord`s Guide, and intend to purchase Don Campbell`s book in the near future. I am always looking to further my knowledge within this field.
I have several questions to ask myself and others in this particular field before I commit to buying anything. I have a few different routes I am hypothesizing - a few of which I am uncertain of their likelihood of success. This is where I need council.
But first, some information on my position and what I expect to achieve.
I am 23, I have a modest full-time income, with the hopes of owning my own home and managing several income properties. I eventually intend to be an entrepreneurial home inspector, obtain Registered Home Inspector status and strengthen my position within the real estate market. I currently do not own a primary residence, as I am still living at home. My credit is meager, but all my bills are paid on time.
Now on to business. My first potential business acquisition involves my father as a business partner, and the area of interest is Cambridge/KW. He has agreed to use a HELOC to secure a mortgage, as my equity/professional insecurity likely cannot establish a mortgage. The deal I think that would best suit my father and I`s goals is after we compound and calculate our numbers, my father receives all the positive cash flow from renters, as he requires income towards his pending retirement. We pay a minimal deposit(5-10%), divided equally. When we decide to sell the estate(which has hopefully appreciated), I receive a higher margin on my return(say, 60%/40%) to compensate for my loss on the positive cash flow.
Now before you critique my intended plan, understand that my father and I have different financial objectives. He is looking for the positive cash flow, where I can afford to invest very little in a deposit and bank on the equity of the house in years to come. Obviously, for all of this to work, the numbers must work. We have time to do the exact math and find the ideal location/tenants, as we will likely purchase this invest in the spring. Management will be a shared responsibility, and the property I am keen on at the moment would be a brand new condo. I look forward to the peace of mind the 7-year Tarion warranty brings.
There is one issue I foresee - Repairs. As my father will receive all the positive cash flow, it would be counter-intuitive for myself to pay for inevitable repairs out of my pocket. Any ideas on how we could potentially compromise in a situation such as that?
My second potential endeavor is to do things the traditional way - solo. I fully intend to purchase my own estate to rent, however I`m worried that if I were to become an entrepreneur, I would have a hard time getting approved for a mortgage. What do lenders look for when accepting applicants? Also, I will eventually want my own property as I previously mentioned, and how difficult is it to acquire a second mortgage? Are their any stipulations involved when already in an existing premature mortgage agreement?
I apologize for the long-winded essay. I have had time to read and observe, but I figure I need some questions of my own answering. Any/All input and suggestions are greatly appreciated. Please keep the comments constructive, as I am still trying to absorb the enormity and complexity that is real estate.
Thanks.
Tristan
