Canadian Investor Looking to Get Started

8 Replies

Hello Guys,

I am a 22 year old 3rd year student at Ryerson University in Toronto Ontario. I am hoping to begin investing in real estate in the next couple of years. I have already invested in some REIT's as a passive way to gain exposure to the industry but am hoping to own and manage my own portfolio of properties in time.

As a young person just beginning to come to the end of my time in school money is of course tight. I am wondering what you guys did to get started in the business? Currently I am thinking a BRRR deal with just a SFH may make the most sense for myself to get my feet wet.

I currently really like the St. Catharines market with the Go Train being extended to the area and strong population growth, Kitchener-Waterloo is also interesting with all of the tech growth happening. GTA is just to expensive for me seeing that I would like to have a CoC ROI somewhere between 10%-12%.

I would love to hear from you guys on your thoughts for where you are investing in Ontario, what cap rates you’re seeing, etc. Also, feel free to DM me to talk real estate, I’m open to grabbing a coffee to talk about your business and would be willing to help you out in any way possible if it meant I could learn in a hands on environment.

All the best!

@Bo Taylor   I'm not in Ontario, but am in Canada.  I'd suggest finding out how much money you can borrow and then think about what you want.  If you don't have a lot of money for a down payment, take advantage of some of the offers the federal government has for first time buyers (use RRSPs, they help with the down payment, lower amount for a down payment) and buy a place that you will live in and rent out part of it.  Whether that's a few rooms in the house, an in-law or basement suite (or you live in that and rent the other part of the home).

For a rental that you aren't living in, you will need 20% down payment; but for one you will live in, you can put as little as 5% down.  With 5% down you will have extra costs (CMHC insurance).

also bear in mind that SFD are not mortgage insurable for rental purposes. However duplex and 4plex are. If you buy one of those and live in it your down payment can be less than 20% needed for a pure rental. Insured mortgages also allow for best rates

Thank you for the tip @Theresa Harris . I am certainly thinking of doing some form of house hacking for my first place as a way to get introduced to land lording and property analyses. This will allow for only 5% down and I will try to find a property that can cash flow once I am moved out.

Originally posted by @Bo Taylor :

Thank you for the tip @Theresa Harris. I am certainly thinking of doing some form of house hacking for my first place as a way to get introduced to land lording and property analyses. This will allow for only 5% down and I will try to find a property that can cash flow once I am moved out.

 One of my buddies have been house hacking for 17 years. He has a single right beside Woodbine Subway station. He divided and made 2 bedrooms upstairs and 1 bed in basement all with separate entrance. The value went from $200,000 to $1.2M. I believe he paid a off his mortgage 2 years ago and just cash flowing and living for free..  I don't expect anyone to keep a home for that long but this guys stuck with his plan. I urged him many times to refinance and do it again close by but he is in retirement mode. 

5% would be a good idea knowing as long as you know your tenants cannot fullfill all of your expenses initially that you will be out of pocket. I mean that is fine as long as your living there. But this route will take a longer while until you hit 20% equity and even longer to use equity for next project.