Is there a sophisticated Real estate investor who would share some feedback?

[dcaz4moores]

I live in Lethbridge Alberta and am a novice in the business of investing in Real Estate? I just downloaded the cities municipal development plan that looks ahead to 2050, and they foresee a population increase of nearly double the present population statistics (70000 to 130000). The College and University continue to draw upwards of 7000-8000 students annually between the two institutions and they make for a great renting base (I think).

Don and others in REIN say Calgary and Edmonton are likely to over achieve, but how about the more modest markets like Lethbridge?

Any feedback will be very welcomed.



Dave.

 

[dcaz4moores]

Maybe it is my question style...I was pretty disappointed when I saw no one responded. However, I will push ahead...I am enjoying the ACRE course and look forward to attending some events throughout the year?



The learning curve is pretty steep...but very enjoyable.



Dave.

 

[kfort]

I began a response but feel under qualified to give too much input. I don't think Lethbridge is close enough to Calgary to experience a large ripple effect. The way I understand is that it still would, just would be less of an effect, and further delayed the greater the distance becomes from the major market. I lived in Medicine Hat for a year but don't know enough about Lethbridge to comment on it individually. Also, take note, I am a beginner.



Cheers,



Kris



Edit: one thing I can add is that I have been reasonably successful with the student rental market. Now, it should be noted that I have only actually rented to one student. My success with that has come from living in a town of ~ 200,000 people, with an influx of ~22,000 people as of September 1st every year. I have the lease set up to expire August 31st. Posting a free kijiji add on July 27th brings 50+ calls in a single day. I use the increase in demand to help ensure low vacancy (0% the last 2 years) and high rent ($985/ 1 bedroom). It has worked well for me.



Get set up with either a great walking distance location or, as I have done, on a direct bus route but far enough away from the school that professionals still consider the location desirable. Not everyone wants a party on their block 3 nights a week... Lethbridge has an amazing campus from what I saw of it, 7,000 people would be what ~ 9% of the population of the town? I would think if done correctly you could leverage that increased demand to help ensure a decent price and a low vacancy. ... but what do I know?! Best wishes.

 

[dcaz4moores]

Thanks for the response Kris...by taking the first step, is evidence we will take as many steps as needed to reach success.

Best of luck in your endeavors...



Regards,



Dave.

 

[RussellWestcott]

Dave thanks for your post, I notice you posted this yesterday, it must have slipped through.



REIN` members have know about the gem called Lethbridge for quite some time... ever since it hit the REIN` Top Alberta Investment town report in 2006. Many investors who buy in that area like to keep it a secret and don't want to the word to get out about the opportunities there.



Good to hear you are enjoying your ACRE homestudy system, to fully complete your research in Lethbridge grab a copy of the Property Goldmine Scorecard and start digging for the information. The Economic Development office is very helpful there.



What follows is from our Executive Summary from our Top Alberta Investment Town Report



Lethbridge:

Having first appeared in the Top Alberta Investment Towns in 2006, Lethbridge returns to our list for a third straight time. The region`s economics have shifted strongly in Lethbridge`s favour along with a stronger and more aggressive Economic Development plan. One of the few Alberta cities that does not rely heavily on oil and gas, Lethbridge has turned the economic corner with strong in-migration, expanding Secondary Education facilities and a more diverse foundation. Because of their distance from major oil & gas influences, Lethbridge doesn`t experience the boom & bust cycle as often as the rest of the province.



The City has a reputation as a consistent economic performer in a province of over-performers. The influx of people, the low vacancy rate, the affordable housing prices, the growth of the commercial and industrial base of the City, coupled with the growing demand for College and University enrollment should help Lethbridge provide home-owners and investors with strong returns on their investment.



Hope this helps...

 

[dcaz4moores]

you are right with the percentage...and the numbers are still very strong. With the learning institution on the west side (UofL) and on the south side (Lethbridge College) it allows for diverse investment opportunities. I Will follow your example and see how it works out.

Again thanks for the reply.



Regards,

Dave.

 

[HeatherBrandt]

Hi Dave,



I have a friend in Lethbridge who has the same kind of rental properties that I do in Red Deer, so we compare notes. I think she has had less vacancy issues than I have this year. I think Lethbridge is a bit more of an even market than Red Deer and Lethbridge seems to have a delay of 6-12 months as compared to other Alberta markets. I believe Lethbridge has made the last few top 10 lists.



Sometimes I check out MLS listing in Lethbridge and I find it very interesting that there is rarely any multifamily listings. Almost never! The ones that are there are very old buildings. The city must have a tight buy/sell group or the owners don't sell!

 

[dcaz4moores]

Thank you for the reply Russell it is encouraging. I look forward to attending some events (I think Calgary will be the closest REIN event location)...and to becoming a bonafide member to make even better use of the forum.

The learning curve is steep but very welcomed...this is just the beginning of a another success story.



Thanks again.



Regards,



Dave.

 

[dcaz4moores]

Thank you for your reply Heather...I think both of insights are true.

I just had a colleague (who knows I am entering into the business of investing in Real Estate), approach me about purchasing a 4 plex from he and his business partner (it has Long term Tenants, and would be a healthy positive cash flow property...as he is motivated to sell, so as to free up cash to buy for more selfish ambitions)...it likely will never see the MLS listing light of day



It would be my first acquisition, yet I am not nervous...more excited to about getting started and building forward.



Again thanks so much for your reply.



Regards,



Dave.

 

[kfort]

Dave, sounds like you've got a great opportunity there. I assume you've made your due dilligence checklists etc? They make life so much easier.



I was going to add a comment about the population doubling projected to 2050. My thoughts on that are probably biased due to the fact that I teach various advanced placement Sciences so take what you will from what follows..

The human population in general is skyrocketing. Exponential growth. Obviously some areas will benefit from this more than others. As far as accuracy of projections, I would dig a bit into why Lethbridge specifically will experience this growth.

 

[housingrental]

Good point

How many cities are going to come out with projections of "we'll grow by 3% in the next 40 years ?"

 

[FlynBuy]

Dave,



Good on you for doing the research and learning. As you know Lethbridge is a great city with a nicely diversified economy. You will see that in the past it has enjoyed the ripple effect from Calgary, but without the extreem peaks and valleys. The city seems active in trying to redevelop some inner city areas and in promoting economic growth.



Be aware that the city has cracked down on illegal basement suites. The apartment/condo market is still small but there are some nice new areas on the west side that cater to the growing student population.



Feel free to contact me if you would like more info.

 

[RussellWestcott]

[quote user=FlynBuy]Dave,

Be aware that the city has cracked down on illegal basement suites. The apartment/condo market is still small but there are some nice new areas on the west side that cater to the growing student population.



For the benefit of everyone on this forum, if you could eleborate on to what extent the city has cracked down... do you have some personal perspective to share, or is this something you have heard?



Are they like every other city, no policy, nothing in writting... will crack down if they have a complaint, or does Lethbridge have a policy?

 

[FlynBuy]

I have only heard through PM about the city attitude to basement suites as I don't have any myself. The city has gone back and forth in the past on zoning.



The main concern now seems to be fire code compliance. There is a program that will grandfather existing suites provided they meet basic current fire code (windows size , drywall separation, smoke detectors etc). In fact there was a small city grant available for such upgrade work- not sure if it still available.



Best to contact the city to get the latest. I have always found their staff to be friendly and helpful.

 

[dcaz4moores]

Thanks for the insights. I am going to check with the city and see exactly what the requirements and expectations are.



Regards,

 

[armingrob]

Hi Dave

We own 3 / 2 Bedroom condos very close to the university in Lethbridge.

We like Lethbridge ,it is a good performer , steady without any jumps.



Don was right when he said " buy close to transportation, hospital, university and so on.

If you would like to pick my brain, just e mail me.

[email protected]

cheers

Armin

 

[johnsu]

Hi Dave,



I used to get lost in trying to interpret all the stats. I usually just listen to what Don says and then hearing Don enough times, you get how to process all this "data". Other wise you'll be lost in all the data and lose focus on what the real end goal is: buying property. Just focus on "following" the rein system first because the real money is not being the "Economist" but being the "real estate investor" that buys and manages property. All I know is that Real Estate works!

 

[dcaz4moores]

John hi,



Thanks for your feedback, I agree. By Planning the work (Doing the REIN course)...then Working the Plan (invest with all the fundamentals in place)...should bring about success.



Regards,