All Forum Posts by: Nick Thompson

Rent to Own does work in Brantford.  However if you cannot find a cash flowing property to do rent to own with then do not do it.  Not all rent to own tenants purchase the home in the end which could leave you with a longer term rental unit and you want to make sure that it still cash flows.  Reach out to Rock Star Realty and they will walk you through the rent to own process an help you find a property.

@Matt Andrews if the property is held in your own personal name and not in a holding corp then it is dificult to shelter the capital gains.  In Canada we cannot defer our tax payments like in the USA (which is what a 1041 exchange does).  

For us in Canada the first step is to make sure you have put all expences against the property as possible.  Then you have to take the gains.  Only 50% of capital gains are taxable so $45,000 in your case.  If you have a second name on the title you can split the capital gains.  My wife makes less then I do so I  always ensure she is on title.  This way we each see a $22,500 income from capital gains.  This amount will then be taxed at your current tax bracket.  

If you find a better way to do this please let me know.

One great advantage we use is dividends.  My wife is a full time mother and has not T4 income.  She holds a different type of shares then I do.  This allow us to pay out all of our profits to only her in the form of dividends and then she pays lower taxes since she is in the lowest tax bracket.  

We also use the BRRRR strategy. We find the best way to get your money out of a property quickly is to change the use of the property. Take a 2 bedroom home and turn the dinning room into a third bedroom. Take a family home and turn it into a student rental. Take a single family home and add a secondary suite to duplex it. Take a house on a large lot and severe off a second lot. The options are endless. If bought right all of these strategies and more will work in surrounding area of Toronto (Hamilton, Ajax, Barrie, Brantford.....) Run your numbers, know your renovation scope and cost inside out and don't be afraid to jump in.

Good luck.

@Matt L. Hands down Rock Star Real Estate Broker has been the best I have found in the GTA area.  They have agents in the Hamilton area but are based in Oakville.  The entire brokerage is specifically geared towards investors.  Every realtor owns multiple income properties so they have the real world experience to help you out.  They put on weekly training classes and have monthly meet-ups.  They will go out and find you a deal, find you money partners, help find tenants.  They really are a one stop shop.  

If you are serious about starting to invest in the Hamilton area reach out to a good realtor who is also investing.  There are lots around.  Call up some realtors and make sure you 'interview' a realtor before you begin to use their services.  Make sure they have at least a few rentals in the area and they should be open about running through some of the numbers to show you how they are cashflowing their properties.  Find someone who is doing what you want to do and copy them.  

Go to local meetups.  I would suggest the Mr Hamilton meet-ups or the Rock Star Realtor ones. 

As for the money if you learn your niche very well and find a truly good deal then partners can always be found.  I am always amazed at how many people have money and want to invest in real estate but don't want to do anything.  If you are going to be living in a house off campus next year anyhow see if your future roommates each have $5,000 as well and go in as partners on a student rental new Mac.  There are many options so be creative and see what you can make happen.

@Greg Robinson  I invest in what is considered a small town.  In my opinion it is both a blessing and a curse.  The curse is that there are generally only a few properties for sale at any given time.  The blessing is that the competition tends to be scarce.  If you can put together a good rental you can also attract the best tenants in town which basically drives out all of the lesser landlords since they get the tenants that are not good enough for you.  With time you may find that burnt out landlords become your main source of deals.  

One other bit of information I wish I had seen earlier.  In a small market there are obviously less good tenants.  Most good tenants eventually go on to purchase their own home.  This can be a great income stream.  As you build up rentals look to do rent to own with your good tenants.  As your portfolio decreases in size due to this keep buying worn down properties from worn out landlords and fix them up.  This way you have a constant supply of newly renovated properties (with some forced appreciated built into them) that you can use to attract the best new tenants coming into the market.  This cycle can repeat itself over and over.

Being in a small community can feel isolating but just know that there are many other like minded individuals out there doing the same thing you are.  BP is a great place to find and connect with these individuals.    

Finding a good Agent/Broker is like finding a business partner.  It takes time and effort but the results are well worth it.  I am not an agent and likely never will be.  In my local market I interviewed over a dozen agents before finally finding the family team I use now.  The husband and wife have been agents and investors in the local area for 25 years and their daughter is a hungry young agent who is now the top deal closer in the area.  The combination of the local knowledge of the parents and the grit of the daughter makes them worth every penny.  Even if I find a private deal I still bring them in and pay their fee out of my pocket just to use their knowledge and expertise.  I also do this out of respect and gratitude for the amount of work they do for us.  Pay good people well and they will pay you back in multiple through their hard work.

That all being said I am always on the hunt for other good agents.  I meet with new agents in the area who say they are investor friendly and put them to work.  I give each one my standard criteria for what I consider a good deal and if they bring me something that fits that criteria then I will buy from them.  It is like using agents as bird-dogs.  My go-to agents know I do this and are okay with it.  They like to see new agents working hard and bringing a good name to the profession and will often poach the successful young agents to come work on their team.

It is very rare to find an Agent who is willing to put in the effort that is required to work with investors however they do exist and they are worth their weight in gold.

Don't give up looking, you will find your soul mate agent eventually.  

They require a $50 membership fee to join the credit union which is refundable if you take your business elsewhere in the future. Being a Credit Union they also provide profit sharing based on the amount of business you have with them. I am closing on a deal next week at 2.89% five year fixed amortized over 25 years. This one is a SFR which requires a medium sized reno. As usual their commercial rates are a bit higher but still reasonable. Their whole process is the exact same as a big bank but they provide a bit more flexibility. If anyone does end up using LIBRO mention me as I believe they have a refer a friend incentive.

I work with LIBRO Credit Union.  I deal directly with them.  They specialize in properties outside of the Toronto area where larger banks don't like to lend.  They can also be fairly flexible on how you want to set up the mortgage.