I am new to investing in real estate
I am new to investing in real estate and I am considering investing in a condominium in Vancouver, mainly for renting to international students, any recommendations?
Hi @Chimi Sakamoto, as a new investor, I highly recommend you listen to the Bigger Pockets podcasts, especially the 'seeing Greene' episodes. Even though they talk about the US market, the majority of their advice is applicable everywhere. To answer your question, it is pretty much impossible nowadays to get a positive ROI on a condo in Vancouver because of the high purchase prices, the rental income won't cover the mortgage unless you bought it at least 10 years ago. Even if you could buy one for cash, it wouldn't be a good return on your cash. There are a couple of cash-only buildings on Broadway with units for about 'half price' because they are leaky condos, but you'd be taking a big risk buying in one of those.
If you currently own a property, you might want to consider getting a bigger place with your investment money and do house hacking. Mostly that means renting out a room if you have an empty one, or you could also modify your floor plan to create a new room and then rent that out. Have you considered becoming a homestay host? It's more money and more work, but it could also be more personally rewarding.
Otherwise, you could look into long-distance investing, becoming a private money lender, REITs, syndicating or wholesaling.
You could always look at lower priced emerging markets such as Vancouver Island. Although there are would be some additional travel costs to visit, and you find long term tenants and good local support network.
Hi @Chimi Sakamoto and welcome to the wonderful world of real estate investing.
As @Steve Lynch mentioned, it can be very hard to generate positive cashflow on Vancouver properties due to the very high price. I've been investing on Vancouver Island lately with great success.
If you're interested in the student housing model, I'm very close to Vancouver Island University in Nanaimo. The student housing situation is desperate right now and students are paying upwards of $1,200 per bedroom. There are a few houses for sale in the area with 5 or 6 bedrooms, for not much more than what you'd pay for a Vancouver Condo. It's not uncommon to get $5,000/m rental income from a $700,000 house in Nanaimo, which creates a good ROI and some cashflow.
Let me know if you have any questions about the island. I host a monthly meetup for investors here and like to help new investors get started.