FAQ’s on Income Properties
Should I consider an out of town investment? If so, how will I deal with tenant and maintenance issues?
Here is a “duh” statement. Look for cash positive properties to invest in. And in many cases to find a good investment we must look where the “fundamentals” are strong. Many of these properties exist outside your hometown. To handle all the complexities of such an investment, you can hire your own property management company which operates in that town. They handle all maintenance and tenant issues. Your goal is to make each investment as “hands-free” as possible.
How do I know the current market value of the property I am interested in purchasing?
The best way is to obtain independent, 3rd party appraisals which form a component of your due diligence process. By the way, these appraisals are not “Opinions of Value” by a real estate agent.
How reliable are cash flow projections?
I believe it is better to take a conservative approach when determining cash flow projections. It is difficult to project into the future accurate information and the best strategy is based on past performance. From this, you can develop calculations that are comparable to current properties. And remember, all projections are exactly that, “projections”. There are no guarantees due to outside economic forces.
How do I go about selecting suitable properties?
The best way is called sweat and hard work…. review hundreds of potentially suitable properties annually and decide on a select few properties each year. By doing this process you will learn what a good deal really is….. As well this site has developed a spreadsheet and analysis program to assist you.
I want to speculate on an investment property for a quick profit, how can your company assist me with my goals?
The best business model is based on the premise of carefully identifying and acquiring strategically located real estate and then holding this investment for the long run. Try not think of real estate the get rich quick method to retirement. So, unfortunately, I won’t be able to help you with your current goals. Although some of our competitors might help you.
How do I go about arranging my finances?
I have access to a broad range of both private and public lenders. You may also want to consider using your RRSP as investment money. This way you will receive both the tax deduction as well as a fixed rate of return on your investment. As with any RRSP, your investment will be secured by real property.
Can I really invest using an RRSP?
Yes, you can. It is not complicated!!