All Forum Posts by: James Ma

I think it's too high level to give feedback on. Most people will jump at the chance to acquire a new customer so maybe you had certain expectations or requests that rubbed them the wrong way?

Some mentioned you dont need a team but its definitely helpful to have people you work with on a regular basis who are good and you trust. Most importantly being a good realtor, property manager and then having a good mortgage contact and accountant.

My biggest learning: Definitely credit check tenants. I believe the majority of investors/landlords still do not do this step and depending on the area, you may be able to get away with it if its all higher end rentals where tenants are making pretty good money but its been the #1 reason I believe I've been able to avoid having bad tenants.

Only 1 tenant who I didn't credit check and she probably wouldn't have passed, has stiffed me on rent and refused to move out. Many others now when they see my ad will complain about having to have good credit in order to rent on FB but it also saves me a TON of wasted time on applicants who will not be qualified to rent anyway. While credit scores aren't foolproof and they may disqualify some poor credit candidates who would've paid rent,  it's necessary in order to avoid the odds of getting into a bad tenant situation where they can cost you months of rent.

I'd assume one of the other big risks you take on is market timing. By the time you finish your renos, the market may downturn and you can't sell or refi for what you had anticipated and may be stuck in a longer hold than planned?

I phone screen to make sure they're a good fit and there's no red flags, discuss my expectations (ie. doing credit check) and then will set up a viewing time for them. If they like the place, they're welcome to apply at that point.

Did the bank appraiser go inside the unit to see the renos? I know sometimes they appraise without even visiting

@jesseflores I'd look at investing into stocks where you can get some pretty safe dividends ~5% and would likely yield a better return than buying a property all cash. However an all cash property should be a safer investment if you think you'll need to access the majority of funds in next 5 years

yes and no is my thoughts. Will 3D houses be cheaper, for sure. But there will also be a quality difference. It will need some time for the technology to mature so the product is a bit better than what it currently is to make an impact I think but the only properties at risk would be the lower quality inventory on the market IMO

Leverage can cut both ways - it can make you more money or can put you more in debt since you're borrowing money for your investment and will have to pay a borrowing fee. 

Recently mortgage interest rates are usually quite low to where it is very easy to make a profit by using leverage to finance your property as your money can be invested elsewhere (ie. solid dividend stock) that will yield more annual profits.

Conversely, if mortgage rates ever go back to being higher to where other investments returns would not cover those rates, then you would not want to be leveraging and pay as much as you can in cash. 

Many prospective tenants are complaining about rents and prices being so high they will be homeless or have to move further away from the mainland. They also don't understand why they can't get a mortgage when it will be lower than the rent they're paying and far underestimating the cost of maintaining a condo/townhouse nor can they save up enough of a downpayment.

I usually stick to safer tenants with good income and a couple have advised they'll be looking for a home but haven't been able to find one they like or can afford yet this year.