What would you do with 200k in Toronto?

Canadian Real Estate
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What would you do with 200k in Toronto?

Jessica Labos
Member since 2018 · 6 posts · 1 vote

Hi all -

I'm new to real estate investing and to this great discussion board! Thanks to all for sharing your experience!

I have around 200k CAD and am looking at investing it in real estate in Toronto. I am 60 years old with a husband and 3 adult kids. Additionally, I am sitting on approximately 800k in equity in my current residence. I am somewhat scared of risk given my age. My goal is to grow a portfolio to include rental properties (for retirement income over time) and fix and sell as my husband is a contractor (we have flipped many years ago before it was sexy and made good profits back then). The investment properties would also be passed over to my kids and grandchildren to help contribute to their financial security.

Prices in Toronto have sky rocketed in recent years pushing me out of the market however, there has been some relief recently. 

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Anthony Dooley
Investor · Columbus, GA · Member since 2014 · 2k+ posts · 1k+ votes
8y

@Jessica Labos I am not trying to be funny when I say this and I'm sure others will disagree. If I were in your exact position in today's record high real estate market with about $1 million dollars in equity and cash, I would sell that house and drop it into an S&P index fund. Get a nice apartment that you don't have to maintain, mow grass, or shovel snow as you get older. Your investment will be completely passive and earn $80,000 to $100,000 per year on average. Great job! You are a millionaire.

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  • Omar Khan
    Rental Property Investor · Dallas, TX · Member since 2017 · 1k+ posts · 1k+ votes
    8y

    @Jessica Labos Garth Turner runs a successful and insightful blog. He is also active in your local are and is a wealth of knowledge. 

    P.S. He has an impeccable track record and refreshing honesty. 

    0Reply
  • Doug P.
    Investor · Kitchener-Waterloo, Ontario · Member since 2008 · 1k+ posts · 1k+ votes
    8y

    @Omar Khan Which one of us is promoting a website in their profile soliciting Canadian investors into their scheme? Yeah, that would be you.

    Unlike you I'm not pushing 'investment' opportunities. I offered to walk her through a rent to own, which I did a few replies further down after she asked.

    Besides, the OP specifically asked for real estate investment advice, and rejected the suggestion that she look into stocks. Looks like she has her head on straight and won't be an easy target for you. Sorry.

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  • Omar Khan
    Rental Property Investor · Dallas, TX · Member since 2017 · 1k+ posts · 1k+ votes
    8y

    lol @Doug P. ... Bro you gotta relax and get some fresh air. Maybe, we'll grab a beer or smoke a peace pipe (or both) the next time I'm in Toronto.

    Easy target? I'm not even peddling rent-to-own/turnkey junk properties. Literally, you can not invest in the deals that I have without a pre-existing relationship (pesky SEC rules)

    You might want to check before going off on a rant. Nobody is soliciting... FYI: I do not and can not solicit investments from strangers (SEC rules). 

    Btw, thanks for ending with sorry (very Canadian, I must add). That really took the sting out of your reply ;)

    1Reply
  • Hai Loc
    Specialist · Toronto, Ontario · Member since 2012 · 2k+ posts · 891 votes
    8y
    I would donate to homeless shelter. Haha In all seriousness I would look into 2nd mortgages. You can get between 8-10% interest only payments. Your capital will always be there and you are collecting month checks. Just need to make sure owner has excellent credit and minimum 40-45% equity. You use 200k and leverage to buy a rental property. You will likely have 0-$100 cash flow per month and run the risk of interest rate rising if you choose variable that will chew up any margins you have. Principal pay down is useless until you refi or sell. What’s important money now or money later?
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  • Roy N.Pro Member
    Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
    8y
    Originally posted by @Hai Loc:

    I would donate to homeless shelter. Haha

    In all seriousness I would look into 2nd mortgages. You can get between 8-10% interest only payments. Your capital will always be there and you are collecting month checks. Just need to make sure owner has excellent credit and minimum 40-45% equity.

    Hai:

    You can write private first mortgages in the 8-10% range.   A private second could command 12-14% ... 

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  • Thomas S.
    Member since 2016 · 13k+ posts · 12k+ votes
    8y

    At your age, as many have advised, I would steer clear of direct real estate investing. You will not likely achieve much cash flow to contribute to retirement.

    As for investing for your kids and grand children all you will be leaving them is a huge mortgage debt and they will likely liquidate to realise what they really want....cash.

    I would sell the house, invest all your money is income funds to generate descent returns and move east.  Plenty of T.O. retirees liquidating and moving to Brighton, Belleville, Kingston and living very comfortably in affordable homes.

    You are living in your retirement fund, liquidate. 

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  • Hai Loc
    Specialist · Toronto, Ontario · Member since 2012 · 2k+ posts · 891 votes
    8y
    Roy N. 14% is insane. I will do that all day
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