Real Estate Investor & Marketing Specialist · Montreal, QC · Member since 2013 · 182 posts · 367 votes
Hey guys,
I am a full-time real estate investor from Montreal, Canada. Almost 3 years ago, I started flipping single-family houses and subdividing land on a part-time basis. One year later, I was able to go at it full-time along with my business partner. To date, we have completed over 20 transactions.
In September 2016, my partner and I decided to keep flipping, but to focus most of our attention on buying rental properties in order to build sustainable long-term wealth.
Fast forward 12 months later, we went from 0 unit to 54 units with a little over 1.7 million dollars in equity (along with 3 million in mortgage).
The key is simple: You just have to do it. Take action! Nobody else will do it for you. Everything you buy should ideally be off market, and you have to be very careful with your calculations in order to buy properties that will surely yield great returns. If you analyze the right way, you will decrease your risk drastically.
No we are not rich, and we used OPM (other people's money) to complete all of our purchases.
Residential Real Estate Broker · Hurst, TX · Member since 2015 · 40 posts · 22 votes
9y
@Guillaume D. Thanks for the reply, that's how I've done my single family rentals and it's worked out great. Need to get some multi's done the same way.
Real Estate Investor & Marketing Specialist · Montreal, QC · Member since 2013 · 182 posts · 367 votes
9y
@Michelle Hood I love a good debate :)! Thanks for the nice words. Having a large amount of debt is actually part of our strategy since we refinance our properties strategically in order to acquire even more units. It's important to understand that banks in Canada will only finance up to 75% of the economic value of our income properties (not market value, but economic value is determined by revenues and expenses and is almost always lower than market value) through conventional financing. This concept is very country-specific and complicated to explain here unfortunately. It's basically what saved us from the US crash in 2008.
The fact that you are not comfortable with this strategy is perfectly fine! However, it doesn't mean that it is not smart investing. It's smart investing for us, but maybe it is way too risky for many others. We are all entitled to building our own investing strategies.
Asking investors to put their mortgage line of credit money into our deals is not as risky as you mention given that our deals have so much equity in them when we make the initial purchase. But I have to agree with you, some people might have bad deals in their hands and convince others to invest when they shouldn't. Investors should always analyze deals very carefully before investing their money. I cannot be held responsible if somebody doesn't run the numbers correctly ;)!
Lastly, some people are building wealth very slowly and with minimal amounts of money as you are saying, but others are doing it another way. Doesn't make any of these two strategies right or wrong.
Real Estate Investor & Marketing Specialist · Montreal, QC · Member since 2013 · 182 posts · 367 votes
9y
@Mike G. I knew this one was coming :)! I've bought houses that had, for instance, a large lot with unused land either on one side, or on either side of the existing house. By subdividing the land, I was able to sell the newly created lot to a general contractor to build a new construction on it, and then would re-sell the initial/existing house that now had a smaller lot. Does that make sense? I cannot say if this is do-able in the US though. I know we do a lot of these here in Quebec.
Montréal , Québec · Member since 2017 · 1 post · 0 votes
9y
Great post! Really inspiring! I was wondering.. what are your criteria’s to put a address on your list when you drive for dollars, and once you have the owners number.. what kind of approach on the phone has worked to most for you? What do you exactly tell them! I would love to talk in pm to get more details on your experience!
Rental Property Investor · San Diego, CA · Member since 2016 · 61 posts · 58 votes
9y
Guillaume D. so awesome, congrats on your success! definitely noting that action is what it takes (along with careful conservative analysis!) i'm 26, and looking for a 40+ unit commercial multifamily right now. planning to be in your position very soon!!
Rental Property Investor · Hamilton, Ontario · Member since 2016 · 285 posts · 181 votes
9y
@Guillaume D. nailed it when he said "The key is simple: You just have to do it. Take action! Nobody else will do it for you".
This is the biggest tidbit I give rookie investors. Don't get bogged down in all the research, reading, and blogs. Execution Trumps Education - period.
By no means go in blind but get started, go look at properties before you're ready, start running numbers etc.
Seattle , WA · Member since 2017 · 2 posts · 0 votes
9y
Appreciate the in-depth response. I respect your investment strategy and business model. Here in the states usually you can mortgage 80% on your first four properties and anything above that or multifamily require 75%.
You are correct about comfort level with risk, and I personally leverage no more than four at a time with an 80% mortgage at minimum on each. Indeed that's the beauty of real estate, different strokes for different folks ;).
Keep rocking it out and best wishes in your continued endeavors :).
Real Estate Agent · Las Vegas, NV · Member since 2016 · 589 posts · 275 votes
9y
@Guillaume D. ok excellent. I've never heard of that strategy and im not a developer so maybe that is a more niche technique in the land developers world. Im not one to get bogged down on a technique, but still pretty cool if thats something that you can do north of the border. But overall your story fuels me to really get cranking on finding off market deals.... harder and more relentless than ever!!!! thanks for the kick in the behind lol
Investor · Chicago, IL · Member since 2009 · 1k+ posts · 1k+ votes
9y
Being a landlord is a business. And it takes experience and wisdom to run it. Impressive start, but I would not run too fast. The knowledge accumulated over years makes you a better investor. I'd start smaller, especially for those in their 20s.