All Forum Posts by: Guillaume D.

@David Collier Jr Hey David! Great to hear that. You are totally right when referring to analysis paralysis. The only way to invest in real estate it to make offers. If you don't make offers, you will never buy anything. Analyzing a deal is only one step amongst many, so people cannot stop there. 

What's most important is to NOT be afraid of getting rejected. You will get 99 "NO" for one "YES". In my market, they say 0.5% of properties for sale are actual "deals", generally speaking. Keep it up and good luck on your Triplex offer. Keep us posted. 

@Aaron Ray As explained in a previous comment, I've always been using the same strategy since I started. I am using a combination of love money and private lending by approaching people around me whom I know probably have their house paid off. When they do, most of them have a mortgage line of credit on their house which is most of the time unused. Therefore, I offer these people to invest in my projects via their mortgage line of credit. I always pay for the interests associated with their line of credit so they don't have to take money out of their pockets, and I offer them a return on their investment in the form of interest when they invest in a flip, and in the form of equity in the building when they invest in long term buy and hold (between 33% and 50% depending on how much money they put in and how much risk they are taking). In my experience, it is always easier to convince a potential investor to lend you bank money rather than their own hard-earned cash. Hope this makes sense!

G

@Youdo Thirakul I understand where you are coming from. Don't be afraid to ask for money. The worst that's going to happen is that they are going to say no. 

I personally think that the best way to ask for love money is to find people around you that have a mortgage line of credit on their house. You can ask to borrow money from this line of credit, so the person doesn't have to take out their own cash, and you offer them to pay for any interest associated with the line of credit + an extra return  such as % of profits, monthly interests, etc. 

You need to give them an incentive to go into the project with you and it's definitely going to be easier for someone to lend you bank money rather than their own money. Get the point? They will basically act as the bank for your project. 

Then, the only thing you have left to do is to factor in this new cost into your flip calculations and make sure your numbers still work. Always be more conservative than not enough because you WILL encounter problems while doing a flip. Renovations are always more expensive than expected, take my word for it. Make sure the projected selling price is BELOW market value in order to sell quickly and avoid long holding costs. Hope this helps!

G 

Cloud Renji The values listed are correct. Economic value is determined by revenues and expenses and not by number of rooms or units. In this case, Roy N. is right, rooms are even harder to finance and require a lot more cash down since their value for the bank is always lower than conventional units. The risk associated with short term rentals is always higher for them. Now, what I suggest you do is call Patrice Menard's team. I know them very well. They have a mortgage broker on their team and he will give you all of the information you need to understand financing better. You really need to acquire the necessary knowledge before you proceed with a purchase. Hope this helps!

Michael Le Thanks! I was myself inspired by other entrepreneurs when I started in the industry so I'm happy to return the favor to other investors.

Philippe Busque In order to keep the same rent amounts even after the conversion, I offered tenants one month free rent. Turned out to be very interesting for them as 17 out of 18 accepted the offer.

Cloud Renji Once again, it's because the bank finances 75% of the property's economic value, NOT the purchase . Therefore, you have to pay the difference between the loan amount and the purchase price as your cash down amount whichever the % amount it is going to be. The only time you will give 25% cash down, as you are refering to, is when economic value = purchase price, which is very rarely the case for anything listing on MLS in our market. If you want good deals and only put 25% down, you will have to find off-market deals at a significantly lower price than what you are currently looking at.

@Philippe Busque Nice to hear from a fellow Montrealer ;)! Here is a breakdown of what I currently own.

Triplex in Mirabel

8-unit in Verdun

12-unit in Mirabel

18-unit in Ste-Therese

16-unit in Boisbriand

To answer your question, I never bought a deal that was owned by a company. It always comes from individuals who usually own one or two properties maximum. 

I haven't bought anything single metered to date. However, I bought my 18-unit on August 2nd and I have just finished converting the heating system this Friday from hot water central heating (owner used to pay for heating costs), to electrical heating (tenants pay for heating and electricity). As a result, I am cutting my annual expenses by 8k on this building which increases the value of the property by 120k. Conversion cost was 40k so we basically made an extra 80k in equity in less than 2 months. 

Sure, send me the numbers and I'll quickly look at time. 

G

@Elijah Moore How can I help?

@Thomas Lorini We need to get in touch! I've always wanted to move to SoCal, but never had the courage to do it. I've been to California 5 times in the last 5 years. I absolutely love it!

I want to hear your story so message me if you feel like sharing.

Thanks!