Is the real estate market different in Canada?

[Andrea Echeverria]

Hello everyone, 

Regards from Eastern Canada.  I am a newbie in the real estate business and I am hunting a deal to get my first property; however when I am trying to follow the suggested rules to analyze a deal it seems the market here in Canada is a bit different.  For example, the suggested rule that your monthly rent income should be at least 1% of the price you paid for a property seems a little bit too high for the market here in Ontario, Canada.  Can anyone give me your opinion on this?  Thanks in advance!!!!

Andrea

[Roy Cleeves]

Hello Andrea:  That used to work 15 years ago yet not now.

I am in Ontario in Kitchener Waterloo and we are happy to find a property that can break even for cashflow or have a small positive or small negative each month and it still works out as a good investment due to the expected appreciation in value over time and the expected rent appreciation over time and the paydown on the mortgage over time.  

You can also find making two units out of a bungalow or similar type of home can create positive cashflow.  You rent out the upper and lower units and the total creates positive cashflow that may not be available in a regular single family unit.