Is a corporation necessary for first investment property?

[Matt Barakett]

Hello BP Community,

I am trying to decide if I should start a corporation before buying my first investment property.

I live in Toronto and am looking to invest in Alberta. I have decided to partner up with another investor to buy this property together. We are looking at multifamily 2-5 units. We intend on building a large portfolio together.

We were thinking that it would be best that we start a corporation together before we buy. Although after speaking with other investors, some are telling us that it is not necessary to start a corporation for our first investment and its better to just buy in our personal names and incorporate later.

This sort of advice that we have received is based on the information that a corporation costs more to start up and maintain.

Should we incorporate now or later? and what are the pros and cons of either scenario?