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Where to park 200k; Residential or Apartment shares?

Discussion in 'Alberta' started by Caleb West, Apr 12, 2018.

  1. Caleb West
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    Caleb West Multi Family Commercial|Collaborative Office| REIN Member

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    Buying and Legally Suiting a home usually requires about $200k , at least is does here in Alberta.
    You want to be getting $1000 for the basement and and $1500 per month for the main floor plus utilities to get anywhere close to cash flow.

    On average it works out to $225k/door to purchase a suited home , maybe a little more when it’s all said and done.

    It’s complicated , it’s takes time , it’s very risky when compared to commercial real estate, highly competitive (i mean look at haw many members Keyspire has that are doing this in just 4 years of existence) and I don’t think it’s worth it long term. For a few years sure , but for 10 plus even 6..is it the best option you have with the same $200k?

    Purchase costs , closing costs, carrying costs , renovation costs.

    It takes from 4-6 months to get done and tenanted and for the rest of your life your subject to government rule changes , bank changes.

    Short term maybe or long term, there better , safer more boring options.

    You’ll get a return if things go right but the economy of scale is just not not on your side with two units.

    200k in an apartment as a shareholder or a limited partner…

    200k in the apartment field will get you between 20-35% ownership in in a 12-40 unit apartment.

    An apartment is less than 140k a door , close to 100k per door in some scenarios with certain asset classes.

    It isn’t subject to your income , it isn’t subject qualifying rule changes or high government control and regulation. You don’t even need to have job to get in on an investment like this

    Maybe I’m wrong but I don’t think residential is a great long term play, if you’re thinking the same then we should talk. IMG_3511.jpg IMG_0473.jpg


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    Tina Myrvang likes this.

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