Income Property for the New Investor

Hey all you wannabe landlords!

Be timewise and look at the listings that abound.  This is the best time since the early 80's that an investment in income producing real estate will net excellent passive income for years to come.

The ABC's of Property Management by Ken McElroy tells the complete story.  When looking for property, don't just take in the esthetics because this is not being purchased for your home.  And be wary of any property that's listed as "live in one unit and let the renters pay your mortgage. You will find out early on that you DO NOT want to live with the people who are paying you monthly rent.  Be diligent in looking at the rent roll (this is the unit list with the monthly gross).  

Another mistake that can be easily made is by overlooking property that may not cover ALL your monthly expenses.  Although it is a bonus to have a positive cash flow, it may not necessarily show the equity building ability of the property say in 5 years or 10 years.  Remember new investors are usually looking for that retirement nest egg because their RRSP just won't (or have dropped dramatically) cover your retirement years.

For more insight on this topic, please send me your questions, comments.  I would love to hear from you!

So What is New with Income Property- for the Tenant

As a property manager in the Toronto - Barrie area, I have seen rentals galore. So what should you look for in Rental Properties. Here's a check list you can use BEFORE you go viewing.

• location, location, location - is it near transportation or major routes to work


• confirm that it IS or is NOT a basement apartment, listings will show something like "lower level", "ground floor", "walk out" If you don't mind a basement apartment then it doesn't matter. (I will blog later on the pros and cons of basement apartments)


• kitchen amenities, I can't count the number of so called kitchens created in places you wouldn't put a closet!


• you CAN negotiate the price. If it is listed at $950. try giving a lesser "written offer" with a deposit cheque (perhaps $900.). It is hard for the landlord to say no to something in writing that has money attached. (but don't try and go for 1/2 price!)
• Or you can ask for a small rebate if the landlord wants full pop. If you are dilegent with the rent payments, then he/she may be receptive to giving you back a rebate cheque at the end of the year (at Christmas when you need it most)
• There are so many rentals, it is not just a home buyers market but a RENTERS market as well.