Advice for a First Time Real Estate Investment

[Christopher Otoo]

Hello Everyone,

I just want to start out by thanking anyone who took the time to read this post and offer advice because you didn’t have to and I’m truly greatful for that. This is my situation and I don’t know exactly what I should do

Firstly, I live in Ottawa, Ontario. I saved up as much money as I could the past two years to be able to purchase my first investment property. I would also like to note that I Live with my parents (for free) and don’t plan on moving into this property. It is strictly for an investment and to generate cash flow. As many fellow people from Ottawa know, the cap rates for the real estate her are not exactly the best. 

I decided to look out of province and found a property in Victoria,BC. It is a 1 Bed 1 Bath Condo. I was able to negotiate the price down from 450,000$ to 400,000 because it is a property from a deed and it’s apparently a buyer market there. I was thinking (and this is where I need advice) on purchasing the property and renting it out “Airbnb” style since the building allows short term rentals. Since I am from Ottawa, I was able to find a property manager who would take 25%. He claims he would be able to rent it out daily at 160-190 a day. He also has units in the building and claims that he is almost always fully booked all year around. I was thinking of pulling the trigger and going with that purchase. Condo fees are around 160 a month might I add. 

I also want to note that I would not be touching any of the money that would come in from the rental property because I wouldnt need to (job pays more than enough). I plan to use the cash flow with my personal income next year to purchase another property.

My question here is should I pull the trigger or try to find something in the Ottawa area. Ottawa doesn’t seem to have that much potential but then again I am completely new to real estate and might be looking over potential opportunities. 

Another question I have is would it be better to venture into the US real estate market as well since cap rates are just so much better and there seems to be plenty of opportunities especially in the midwest I have no issues with paying a property manager or even doing a turn key property to generate an awesome cash flow.

This is my first purchase so I want to make the best choice so that I can use this income to flip to my next unit and again and again.

Thanks again for the read !!