All Forum Posts by: Brian Hosier

I work with a Canadian company in Saskatchewan that has over 400 properties and 700+ doors. They've been at it for about 7 years and currently have about $100M under management. Their goal is to get to $1B and I think they'll do it in 5 years because they've been doubling every year. I have a few passive rentals with them and they do ALL the work, I just deposit their checks. They're expanding into the US in a few weeks. Msg me if you want more info.

Hi @Rachel Cutler, there is some great cash flow opportunities in Cleveland if you buy in the right areas. I work with a team that can offer a 15% targeted cash-on-cash return and you can start with just $25k down. Not sure if you're eligible but msg me if you would like some info. Good luck with your RE investment journey.

Good discussion here on passive investing and syndication opportunities. In my understanding, I thought most high quality syndication opportunities were open to accredited investors only. Is that the case for the syndication deals being referred to earlier in this discussion? 

It is likely that there will be a "market correction" but it's still anyone's guess on the size of correction. I have tried to balance safety with a great return, but still believe "cashflow is king" and invest in rentals where I rent to a corporation and they are responsible for tenant turnover, maintenance, etc. 

Many new investors think real estate provides passive income. They follow the BRRRR strategy and think after I get to 10, 20, or maybe 50 houses, then I can sit back and just cash the rent checks every month… I'll be set!

However, speaking now to the seasoned RE investors out there, you know it’s not that easy. When you start out you do all your own property management and typically don’t pay yourself for the time you are spending to manage the properties. If you don’t pay yourself, you actually have a “job” where you are working for FREE.

Sure, you may have a “pay-day” months or years later when you sell but that’s not guaranteed depending on the market you are in. If you are highly leveraged and the market takes a downturn, you can easily be “under water” where your property has a market value less than the outstanding loans on it.

A common prediction going around in 2020 is that we are almost guaranteed a recession in the next year or two due to the large amount of government stimulus, record high unemployment, large number of bankruptcies, shrinking GDP, etc., etc. Usually during a recession, house prices drop at least 10% and in severe markets it can be much more. Does anyone remember the Great Recession in 2008/09 and seeing prices drop 40-50%?

Assuming you are NOT over-leveraged on your real estate and can ride out a market downturn, I believe it is possible for real estate to be a truly passive investment. However, you need to do it by "being the bank" instead of just the "flipper" or the "renovator". Even buy-and-hold investors that follow the BRRRR strategy religiously for years, will eventually be RICH but it will only happen after a HUGE investment of your time. What is your time worth to you?

I first started RE investing in my 20’s and got up to 10 doors with some success but had to bail when the market corrected in the late 1980’s. I learned then that “leverage is a double-edged sword!” Now in my early 60’s, I’m a little wiser and want a truly passive RE investment. I no longer want many 12-hour days running around, answering tenant calls, finding new used appliances, rehabbing, screening tenants, evicting tenants, and so on.

What I wanted was a passive, turn-key investment, where I own the asset (i.e. the house) but I am never involved in the day-to-day management. Maybe it’s because I know see my time differently. As Kiyosaki says “The Rich don’t work for money” where you trade your time for dollars. I’m not rich but I want a comfortable lifestyle where I let my modest money work for me.

W own just a few rentals that comfortably bring in over $2k/month ($24k/year), with zero-effort on my part. We leverage our credit, work with a credible company that has been doing this for years, and continue to re-invest our profits. We also play the role of the “bank” and help the same company fund their flips, and that brings in another $40k per year passively. Overall, we earn anywhere from 12-17% on our investments while my wife and I do what we love which is cruising, travelling, etc. 

For us, RE investing is truly passive but it took me over 30 years, and after losing probably $400k in real estate over the years, to finally find the niche that worked for us. As Matt Theriault from the Epic Real Estate podcast has said many times, “In Real Estate, you’re either making money or you’re getting an Education!”. I’ve got my education so that we can make money passively. Good luck in your real estate journey.

Hi @Ann Shereck, great question. I began investing in the GTA in the 1980's and back then it was easy to cashflow and get 1% rental. My first property was a triplex north of the Beaches and we paid about $80k and total rent was about $1100/month. Seems like a lifetime away!

Now I live in Vancouver and can't cashflow here so we invest in Saskatchewan where the numbers work easily. However, you need to have a PM that you trust 100% or otherwise the long-distance investing is a nightmare. We have 3 passive rentals there with a great consistent return. 

If you want to know more, drop me a message and we can discuss the details. Good luck with your real estate journey.
 

Hi @Michael Peverelle,  regarding property management I don't do any. Really! One of my criteria for out-of-province investing is that I'm NOT managing the property or trying to "manage the managers". I have done property management years ago but not interested in it any more. I funded the deals and earn a great 15-17% return annually, after all expenses. For the 3 properties, I net over $2k monthly profit.

Hi Isaac,

I sent you an email asking for more details.

Hi Mayvon, 

Welcome to the BP community and you landed at a great time. Generally, assuming you're new to real estate investing I would suggesting investing near where you live. However, if you live in a major urban city it's often hard to find the right deals that can cash-flow. For example, I live outside of Vancouver and the ROI (Return On Investment) is a challenge, especially since we are likely heading into a recession and house prices are predicted to soften over the next couple of years. CMHC estimates that Vancouver prices could drop 8-12% over the next couple of years.

That is why I always look for positive cash-flow and I own a few rentals outside of BC with a great return. The Real Estate Guys radio show have a great phrase of "Live where you want to live but invest where the #'s make sense". Investing out of town can make sense but it's a lot more risky for new investors or if you are trying to manage remotely.

Regarding where to invest in Canada, there are a lot of good markets and you can just Google what the experts such as REIN, Canadian Real Estate Wealth, or MoneySense predict. However, as mentioned earlier, it's best to be local (i.e. within an hours drive) when starting out. If you want to discuss more, message me and we can talk further. 

Good luck with your real estate investing! 

Hi Adam,

Congrats on being so young and recognizing that real estate is an excellent long-term investment strategy. I live outside Vancouver and agree that it would be a tough market for you to invest in without substantial resources. I invest passively outside of BC, but still in Canada, where home prices are a fraction of the cost. If you want to discuss more, message me and we can talk all things real estate! Good luck on your RE journey.