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The benefits of owning multiple properties

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Canadian Realestate Magazine | 07 Apr 2015, 09:16 AM Agree 0
Investor Lee Strauss explains how owning multiple properties equals multiple income streams for the savvy investor.
  • TimRemken | 07 Apr 2015, 07:11 PM Agree 0
    Good article Lee. My favourite so far.
    Breaking down the income streams clearly like that is what I needed to see.
    Clearly I need to buy more investment properties!
  • | 09 Apr 2015, 12:49 PM Agree 0
    re-check your math on the mortgage paydown. You've under estimated in after 10 years.
  • | 12 Apr 2015, 07:23 AM Agree 0
    Agree with the above comment ^
  • Kp | 12 Apr 2015, 04:54 PM Agree 0
    Large portions of your monthly payments are interest so the mortgage pay down is accurate. The principal will be paid down in the last years, bank makes their money first
  • | 10 May 2015, 03:11 PM Agree 0
    whoever wrong this has the math completely wrong.

    like the previous comment re-check your math on the mortgage balance after 10 years.

    318 per cent for 10 years does not mean 31.8 per cent per year. it is about 15% per year.

    who will pay these expenses? realtor commissions on sale, property taxes, maintenance expense, vacant periods, tenant rent collection, eviction if needed, tenant credit verification cost, and the time you put in.

    Also in canada real estate does not appreciate at 4%, it appreciates more in the 2% to 2.5% range for single family if maintained well and 1% for townhouse condos.
  • John Edmunds Las Vegas | 05 Jun 2015, 03:45 PM Agree 0
    Excellent article and basic enough for anyone to understand. Why wouldn't you want to own multiple properties. An additional plus is when one or more come up vacant you have enough cash flow to still cover all your expenses.
  • rue. | 23 Dec 2015, 07:28 PM Agree 0
    "318 per cent for 10 years does not mean 31.8 per cent per year. it is about 15% per year."

    Correct. The author is calculating it arithmetically. It needs to be calculated geometrically for an accurate per annum return on investment. Use a simple present value calculation to get the right percentage/year return.
  • Amy | 09 Dec 2016, 01:26 PM Agree 0
    I am 60, some realtor give me 3.2 millions to buy my 1.2 millions rental property, but we don't want to just sell it and we want to buy some property to invest again, but it is not much house in vancouver market , what you suggest we should do ?
  • Scott | 09 Dec 2016, 04:45 PM Agree 0
    @ Amy, if I was in your shoes, I'd sell the Vancouver property for the $3 million and use the proceeds to purchase real estate in a different province such as Sask or Man. Ontario is also a possibility. With $3 million and the average house price being $300,000 you could get quite a few properties in her provinces. If you want to keep your current property and stay in B.C., you may have to wait til there is a market crash and house prices return to something reasonable. And no, before you ask, I have no idea how long that will be. Could happen tomorrow, could happen in 20 years. No one knows. I do know it will happen eventually. Those are my thoughts.
  • Scott | 09 Dec 2016, 04:49 PM Agree 0
    Correction - you could get quite a few OTHER properties in those provinces.
  • Scott | 11 Dec 2016, 08:22 PM Agree 0
    @ Amy - being as I'm in Winnipeg and the title of this topic is multiple properties, the December 9, 2016 edition of Winnipeg Realtors Real Estate News has the following properties listed: St. Boniface triplex, $499,900, 2A-1628377, agent is Bobby Silman at 204-477-0500; 4-plex, $199,900, 4C-1628465, agent is Michael Monchka, 204-987-9800; 4-plex, $549,000, 5D-1624005, agent is Ed Yuzak, 204-475-9130; this property was sold but will give you a sense of the market St. Vital triplex, $399,900, 2C-1629496, agent is Adam Carriere, 204-987-2100. Hopefully those 4 listings give you a sense of how far $3,000,000 could go in other provinces, especially if you use leverage and take out mortgages. I've no connection to any of these properties or agents, I'm merely using them to illustrate how far the profits from selling a $1.2 million property for $3.2 million could go in Winnipeg. And, Amy....I wish I was in your shoes!!
  • Houses | 26 Mar 2017, 11:55 AM Agree 0
    This math is terrible - your total risk is actually $300,000, not just your down payment - and you're making a lot of assumptions: Assuming you can weather the 2-3 inevitable market downturns over the life of the mortgage, don't have tenants from hell or major maintenance or repairs, don't have interest rates rise, etc. You're also missing the lost income potential due to the cumulative thousands of hours spent on maintenance, repairs, rent collecting, etc.

    Over an average mortgage life of 25 years, you'd better off investing in an index fund... and this way, you're not crowding the real estate market with yet another prospector who's pushing young families further and further from affordable real estate.
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