can i get an opinion on these two properties in sherbrooke QC?

5 Replies

hey all, i was wondering if some more veteran investors in canada (even better quebec) can give their opinions on these two quintuplexes that i'm currently looking at in sherbrooke, and my analysis of the properties

property #1: quintuplex with gross rent 28,260/yr with asking price of 150k

https://www.centris.ca/en/5plex~for-sale~fleurimon...

pros: 

cheap, high cash flow, downtown

cons:

old (built ~1900, in a somewhat seedy part of town)

property #2: quintuplex with gross rent 27,360/yr with asking price 200k

https://www.centris.ca/en/5plex~for-sale~mont-bell...

pros: relatively cheap, a bit newer (1950), good location (downtown+near stores)

cons: on a busy road (kind of noisy), some grafitti on the side (indicates poorer neighbourhood)

what do you think? obviously the first deal is much better in terms of numbers, and its been on the market for almost 2 years now. 

anything i should watch out for when looking at these types of properties (low cost multiplexes in questionable neighbourhoods)

thanks,

Russell

I don't know about location , however 

1- old buildings require more maintenance so you should have high cache-flow to cover the extra expenses. 

2- QC rental laws are extremely sided with renter and increasing rent is very limited and regulated .

3- when it was last renovated ? some old building get sold for less because they need to be reconstructed. 

Good luck

not sure when it was last renovated...i guess for 100+ year old buildings, it must have been at least once or twice though.

is there any particular structure that is better in your opinion? ie, brick vs not brick.

thanks for the tip about the maintenance. i guess it makes sense, unless its recently renovated.

i was also curious if there are any big ticket items that could come up with old properties like that...wiring, lead paint, etc...

You might need a good inspector to give you report about all the house issues . also a contractor to give you estimation of how much money and work needed to make it rent-able, remember if you want a good family to rent your home , you need to have a neat kitchen and rooms. 

old houses can have higher bills, leaks under ground , tree roots pushing the structure of the house from underground , beside like you said , out of date building codes that any simple fix might require re working all the house. 

Originally posted by @Kaman P. :

@Russell Butler did you end up purchasing either properties? 

no, the 200k property has sold. too bad because it looked like a good deal. i'm just finishing my doctorate so my income is kind of low but once i start working full time i plan on purchasing in the area asap. 

my goal is to acquire 20 doors over the next 5 years, so i'll have to start soon ;)