Limited supply and high prices in key markets is encouraging landlords to embrace the role of small property developer. But are the big profits worth the hard work?
An increasing number of investors are turning their attention to property development in a bid to maximize on the demand for single-family homes.
Speaking to CREW, investor Sahil Jaggi says buying an old building and undertaking a complete rehab is the only way he can get into desirable neighbourhoods at a good price, and opportunity to make a lot of cash.
While admitting that the work is a full-time job with the risk of unexpected costs popping up, Jaggi says joint-ventures are the best way to get into such projects.
“If you have a good plan, good location and a good project lined up you will always find investors,” he says.
“If 20 to 30 per cent of the area is already developed, you know it’s headed towards something and there’s room for growth.”
Paul Shikanai, owner of Regency Property Management and Real Estate in Regina, advises investors to be financially creative when undertaking such projects and do not undertake any unnecessary costs.
“I’ve seen people put a lot of money into it and it’s hard to get that return,” he says. “You don’t need to put in a granite countertop. You don’t need a beautiful tile on the floor.”
***Do you want to learn more about small property development? The September issue of Canadian Real Estate Wealth features a comprehensive step-by-step guide of what is involved in small property development. Investors reveal the secrets to successfully undertaking such projects, while city planners and lawyers offer exclusive advice on how to avoid unnecessary costs and headaches. The magazine will be on newsstands this week or subscribe here to avail of a special deal today.
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