Investment Project - Which Way Do I Go?

[UTCVenturesLtd]

I have a property in a small town in Saskatchewan that i bought in Oct of 06 for $50K. Now appraised at $120 to $125K. It is currently rented to a senior couple who were originally trying to make it into a bed and breakfast although currently not well enough to continue in that direction. http://ca.geocities.com/macroriebandb to take a peek of a video that i had made for them which shows a glimpse of the exterior/interior. The laundry room hall with the garage access door can be made into a common area for 3 potential suites. The upstairs with a bathroom can be made into a suite and the basement can be made into a 3rd suite which has a second laundry area. Just has a shower stall to be installed. There is a rental shortage in the area and i am wondering whether to fix up both the upstairs into a separate "furnished" suite and the basement area into a "furnished" suite to provide some "temporary" accommodations til the new renters could find suitable rental accommodations in the bigger town 15 mins away. It would mean adding a few new doors for the common area, some kitchen cupboards and a sink, a small fridge and hot plates and some cosmetic work, etc. Each suite would rent for between $400 to $500 and could bring in more if rented short term for a vacation purpose. The lot is 80` by 130` so there is lots of parking available. I am leaning towards doing the extra work to make it happen, but it is tempting to take the money and run although the house price would be worth a LOT more having the additional work done and with all three suites rented out. My renters are okay with having others in the house in their own suites and would love to share the utility bills with them. The house is close to 2000 sq ft. and they have been paying rent and the utility bills.
Any suggestions or pitfalls to watch out for?
Dean
[email protected]

 

[RebeccaBryan]

Dean,

I`m definitely no expert but I did grow up not too far from that area. In my opinion I would sell and invest in a place with better fundamentals. Investing in Saskatchewan is one thing, but investing in small town Saskatchewan is another. Outlook is in the middle of nowhere, too far from Saskatoon to capitalize on any ripple effect. If you go ahead it would be nothing but pure speculation.

Incidently, I grew up in Saskatchewan and lived on a farm there until 2001 when I moved to Alberta. My parents/companies still own a large farm there which I own a part of. My Dad bought expensive Moose Jaw heavy clay in the early 80`s for $1100/acre because he wanted to have some of the "good stuff". He persevered through a lot of hard times and is one of the few farmers that survived purchasing that kind of property with 18% interest rates and $2 wheat prices because of the fact that he had a ton of other land that was already paid for and it subsidized the expensive land. My Dad`s reasons for investing in farmland in Saskatchewan was not only for prosperity but for the lifestyle Saskatchewan offers. In my opinion his decisions were based on emotion.

I remember when I was young, a realtor advising him that he should buy farmland around the Edmonton area and move. He actually considered it but it never transpired. While he is a multimillionare today, had he made that decision, he would probably be worth $100 Million.


With all due respect to Saskatchewan, it would surprise me if it ever prospered greatly and that has largely to do with the government, which at the flick of an election could turn back to NDP. The way the electoral constituencies are set up, the major centers usually go NDP, and when that happens, that`s the government that goes in. When I moved to Alberta, I really moved to Ralph Klein and the fact that Alberta had a consistent right wing government, which I beleive makes a huge difference.

I agree with Don when he says "let others speculate".

 

[LeighF]

QUOTE (RebeccaBryan @ Feb 6 2008, 06:30 AM)
Dean,



I'm definitely no expert but I did grow up not too far from that area. In my opinion I would sell and invest in a place with better fundamentals. Investing in Saskatchewan is one thing, but investing in small town Saskatchewan is another. Outlook is in the middle of nowhere, too far from Saskatoon to capitalize on any ripple effect. If you go ahead it would be nothing but pure speculation.



Incidently, I grew up in Saskatchewan and lived on a farm there until 2001 when I moved to Alberta. My parents/companies still own a large farm there which I own a part of. My Dad bought expensive Moose Jaw heavy clay in the early 80's for $1100/acre because he wanted to have some of the "good stuff". He persevered through a lot of hard times and is one of the few farmers that survived purchasing that kind of property with 18% interest rates and $2 wheat prices because of the fact that he had a ton of other land that was already paid for and it subsidized the expensive land. My Dad's reasons for investing in farmland in Saskatchewan was not only for prosperity but for the lifestyle Saskatchewan offers. In my opinion his decisions were based on emotion.



I remember when I was young, a realtor advising him that he should buy farmland around the Edmonton area and move. He actually considered it but it never transpired. While he is a multimillionare today, had he made that decision, he would probably be worth $100 Million.





With all due respect to Saskatchewan, it would surprise me if it ever prospered greatly and that has largely to do with the government, which at the flick of an election could turn back to NDP. The way the electoral constituencies are set up, the major centers usually go NDP, and when that happens, that's the government that goes in. When I moved to Alberta, I really moved to Ralph Klein and the fact that Alberta had a consistent right wing government, which I beleive makes a huge difference.



I agree with Don when he says "let others speculate".






HI Rebecca

My name is Leigh. New to the forum, but learning alot. I am also a farm girl from Saskatchewan, growing up in Turtleford and have lived in Fort McMurray for the past 23 years. My husband and I are actually doing some land hunting around Meadow Lake right now. Things have been picking up there over the past year, housing getting more expensive and the land owners are starting to subdivide their land and putting it up for sale. Talking to one realtor, there is a new mayor at the helm, that is working hard to get new business into the area. It maybe on the cusp of oil and gas discovery with the royalty regime in Alberta. I think we're going to take the plunge and buy around there. Right now for investment purposes, but we are buying land that is very beautiful if we wish to keep it for retirement. I liked your comment about the NDP government though. Gives me something to think about, cause you know and I know, the NDP hasn't done a whole heck of a lot for developing Saskatchewan like they should have and could have.

Leigh