Edmonton Real Estate Investors Association Message Board › Hey It's Matt...Re: real estate
Hey it's Matt,
From the real estate meet up. http://realestate.mee... I thought I'd mention a few things about various real estate markets.
The first thing I should mention is how I find it amazing how many people are just focused on the Edmonton market. Edmonton is a safe bet, but we seem to be a little peaked out at the moment. Until wages climb higher real estate cannot realistically go up much more than it is, otherwise most people will not be able to afford to buy anything. As they go hand in hand.
One thing I've benefited from is Doph Deroos when he said "be counter cyclical", and perhaps the one we all know "buy low sell high", which definitely applies to this.
But in order to do that right now you need to be willing to explore outside of Alberta. Alberta is really peaked out at the moment. Same with BC, and Sask, where you're paying upwards of $100,000 per door for your average low rise apartment building.
However, look out east a little more on sites such as icx.ca and you'll find many apartments in Manitoba, Ontario, Quebec, and the maritimes going for around 50k per door. The rents are not that much different between provinces either. For example I own apartments in Ontario and the average rent is about $750. So even here you're hard pressed to ask much more than that for rent. But you're getting the properties for "half" what you pay here. You get the picture.
And that means that the properties out there actually "cash flow" each month. I did a calculation recently and the properties I bought out there over the last two years were averaging about 11.5% cap. And considering I put down very little to buy that's quit significant in terms of revenue. Don't even think about getting that here.
So there's one opportunity for you. "Look out East" you can see properties at: icx.ca that's Canada's MLS for commercial properties. You should have that bookmarked.
Also one other thing I'm looking at is this. Like many of you I'm just sick of these long winters. So what better time to buy in places like Arizona, Nevada, California, Nevada etc than now. I was just looking online at properties in Vegas and the average Vegas residential property dropped over 10% in value since last fall. It's crazy because you can get an incredible deal if you buy now.
The other advantage to some of these popular tourist hot spots like: Vegas, Palm Srings, Honolulu etc etc, is that you can easily find renters for your property. You have the option to do rentals to vacationers, in which case you'll earn a lot more than just renting it to a local person. Or if you don't want that hassle you'd instead just find a local renter to move into your place. Possibly even just renting it out for the summer months, then as winter comes leaving it more open for you and your family to enjoy.
I was just saying to someone at the meeting that it's a great opportunity. You just buy something, even with no money down, and you get a renter in there. Then one day perhaps when it's time to spend your winters down in a warm climate you can go to places like Vegas or where ever you happen to fancy and enjoy yourself. Perhaps by that time you'll have much of the mortgage paid off, and it may amount to a very significant aspect of your retirement strategy. Also down the road as real estate prices bounce back you'll be perfectly poised to profit from the upswing.
Again that's how people get rich in real estate, by being counter cyclical, and buying low, selling high. There are tons of people who right now will gladly sell to anyone willing to simply take over their payments. And there are many opportunities to buy at 100% financing. So get in if you can.
Good luck, and I'll be announcing the next meeting shortly.
P.S.: Feel free to forward this email to a few friends who might want to get involved in coming out to our group. Take care.