New member from Ottawa re-post for fellow Canadians

22 Replies

Hey everyone,

My name is David, I've been listening to the BiggerPockets Podcast for several months now and was happy to see that there seems to be a passionate Canadian community here. I'm 25 years old, living in Ottawa and recently graduated university with a BComm in accounting. I started university a little late (followed a hockey dream) but am happy to have a full time job starting this month. My plan is to try and excel in my new career and begin building up multiple streams of income through real estate investing. While I'm quite young and not worried about "early retirement", financial independence is definitely the end goal and the freedom it provides.

Lacking much in funds, my summer has been spent reading and learning as much as I can. Some of the pillar books specific to real estate I've read recently are:

- "Rich Dad, Poor Dad" - Robert T. Kiyosaki

- "Real Estate Investing in Canada: Creating Wealth with the ACRE System" - Don R. Campbell

- "What Every Real Estate Investor Needs to Know About Cash Flow... And 36 Other Key Financial Measures" - Frank Gallinelli

- "The Book on Rental Property Investing" - Brandon Turner

Pretty much every BiggerPocket Podcast in the last 6 months...

Also since Brandon Turner and David Greene are big on business books, a few that really opened my mind over the last year or two are:

- "So Good They Can't Ignore You" - Cal Newport

- "The Millionaire Next Door" - William D. Danko

- "The Undoing Project" - Michael Lewis

Overall, I frequently find the numbers talked about for some of the American markets unrealistic here in Ottawa, even relative to the surrounding smaller towns. But then again, I'm sure the good deals are out there waiting to be made. My hope here is to connect with others of the same mindset, learn all I can, and provide as much value as possible moving forward.

Here's to connecting with you all!

Hello David, 

In my experience, it's pretty hard to find properties in the Ottawa area with the numbers they use for the American markets. If you do find some properties that work you are probably looking at a submarket with some less than favorable tenant profiles. Just my experience. Could be wrong though. 

For real estate books, I liked. 

The Real Estate Game by William Poorvu 

Confessions of a Real Estate Entrepreneur by James Randel. 

Lots of the real estate books I find filled with useless regurgitated fluff. 

Welcome David.

I'm also in the Ottawa area and have been doing real estate the past couple of years after many years in another career.

I'm sure good deals can be found in Ottawa but generally speaking these would be unlisted properties and private deals. Most of the stuff on MLS is market priced.

My partners and I have managed to find a few good opportunities in the smaller towns surrounding Ottawa. We find those smaller towns generally more financially interesting and the bureaucracy a bit easier to deal with.

You might want to look into joining OREIO if you haven't already. I joined that group last year. Membership is inexpensive and you might make a good contact or pick up an idea you could use.

Best of luck. If be happy to meet with you in person to exchange ideas of you wish. 

Hi when the returns are low like they are in Canada, the best thing to do is invest in houses that can be switched to more rental income . Example renovating a large house into a duplex, or a water or fire damage house into a liveable house again. Then renting it out for a better return.  I just bought a 3 plex with water damage and renovated it. It was a cheap price 170,000 and a 105,000 renovation. After all expenses there was a 1600 a month return or a 7 per cent cap rate.         Best of luck. Jim Johnson. 

Hey, all, if we're talking meet-up I would be interested. Does anyone attend the OREIO group? https://www.oreio.org/

There's lots of properties to invest in Ottawa. You just have to know how to make them cashflow. The key is to not necessarily follow conventional thinking and to be creative.

@Shane Hale - is it worthwhile? I thought hard about it last year - even signed up for a meeting that I ended up missing due to work - but am looking for someone else's thoughts.

@Chris Habets for what you pay I would say yes. You will usually meet someone interesting and learn something new each time you go. Some portions of the agenda aren't my preferred style as they're a bit sales-y but there's something for everyone. I probably attended 4 sessions last year. I learned of them here on BP and decided to give it a shot. I'd say at least try one meeting to get a feel for it. You can go as a guest for $25 but a year's membership is only $100-ish.

Welcome @David Weckworth ! Good to connect with you. I am 25 as well with a portfolio of properties in Windsor. I grew up in Windsor but moved to Guelph for school, and when I got into real estate investing I ended up moving back to Windsor because the prices and cash flow were so attractive. There are markets like this where you can get similar returns to what they discuss about the states (the 1% rule is no problem in Windsor). It just depends whether you are comfortable investing from a distance, but I have many clients who do so with success. Great book list, thanks for sharing! 
Cheers! :)

Originally posted by @Shane Hale :

Great!  There are a few of us from Ottawa on BP. Perhaps we could start a Meetup or something like that.

 I’m certainly on board participating in any local BiggerPockets events in Ottawa or Toronto. I plan to attend OREIO events as well!

@Cassidy Logsdon I'm definitely open to long-distance investing, I'm more drawn the the analysis and making sure numbers work to hopefully make up a sound investment than necessarily doing the hands on labour. Very interesting about Windsor, I've browsed southern Ontario online but I'm not very familiar with specific areas.  Congrats on what sounds like a great start to your career, thanks for reaching out!

If you are looking for a Meetup I've started one with my partners in Ottawa that will focus  on US real estate we want to give lost of value on the subject and share our experience. Our next event is in a few weeks on Tuesday, September 25, 2018

6:30 PM to 9:30 PM at the Hellenic Centre. Look us up on Meetup Building Wealth Through US Real Estate

cheers! :)

@Jim Johnson returns in Canada are not that low. You are referencing a 7 cap, I have multiple deals right now at cap rates between 8 and 14 with possible equity increases of higher than 20% after small renos and a tenant cycle. The deals are there for those who dig for them.

Hello everyone. Arthur from Ottawa.

I've been reading a lot about real estate investment in the past 2 years and planning to make my jump and close the first deal by the end of the year /2020.

But I would like an advice... 

I have ~$200k and would like to jump in rental properties, either in Ottawa or Gatineau (QC)... 

If you were starting on the business today with that amount of money, what strategy would you use? BRRRR with 20% down payment on single/multi-tenant properties as far as your money can go? Ultimately, my objective is to have enough cash flow on my properties to be able to quit my job in the future.

Also, does anyone know about the tax implications on holding a real estate portfolio? Is rental income still considered passive income and taxed at 49% by CRA, even though it is your single source of income in case you are not working a regular job?

Thanks all

Arthur

Originally posted by @Arthur Abreu :

If you were starting on the business today with that amount of money, what strategy would you use? 

Also, does anyone know about the tax implications on holding a real estate portfolio? Is rental income still considered passive income and taxed at 49% by CRA...

Arthur

Hi Arthur! I'm a big fan of the BRRRR, although finding deals that really qualify to get all your money out in a year or less is a challenge in the city proper. Small towns outside of the city are a little easier but not a slam dunk. There are some wholesalers that seem to find deals that can do it.

For taxes, real estate income is passive income in a corporation unless you have 6 or more employees. There is a way to set up your corporations (at least 3) that allows you to access that 15.5% tax rate without 6 employees. I'm not fully up to date with the math, but here's a starting point

 

@Chris Habets

Thanks for that link.

I've been trying to figure out a good way to structure things moving into the future as I purchase more properties. I was thinking about something vaguely like that but having it layed out and explained definitely helpful.