All Forum Posts by: Jay Gill

Hi Jay 

Can you share how can you positive cachflow in Brampton ? 

Basement + upper level =3500 

Home prices : 650 + for home that is good enough to be rentable .

Did I miss something? 

Jacob : why not , will pm you my number to have some chat. 

Hugo: would you mind sharing your  home price , cacheflow nimbers ? The reason why I ask to all benefits from experience of each other as most numbers on this website is for USA houses

So we scrubbed, we cleaned, we staged, we painted.  Everything was a go, the house presented amazingly.  The appraisal started upstairs and we worked our way to the basement floor. We were showing off the completely renovated basement that is beautiful and our lovely pug named Baxter takes a big old poop right beside her while spinning in a circle.  I died.

That wasn't on any HELOC preparation checklist I could find. :(

**** Happens.

I have been agonizing over ownership structure for past week because I want to buy soon and have seen properties I'm interested in, but I need to decide whether to form a corporation and form one before I buy the property if I will have my corporation hold it, and I am very concerned about legal liability as well as overly onerous and/or expensive tax obligations. 

I have read about a 3 tier corporate structure described in a few places:

http://mpgroupcpa.com/post/3-tier-corporate-struct...

http://www.businessgrowthstrategies.ca/2425/how-to...

The idea is to own each property through its own corporation (the "real estate companies"), have a management corporation that manages the properties (the "management company"), and have all these corporations 100% owned by a holding company (the "holding company"), which is owned by one or more individual investors. The real estate companies hire the management company, which collects rents and pays for repairs, maintenance, etc., takes a property management commission, and gives the rest to the real estate companies. The real estate companies pay dividends to the holding company as needed.

I think this setup could work well for people with multiple properties and multiple investors. It should provide good liability protection, and the management company could qualify for the 15.5% rate for active businesses. However, it does sound like a lot of work to set up and a lot of accounting to handle day to day, especially for those of us who have fewer properties, as well as the double taxation inherent in any corporation setup. There could be a lot of double taxation when the properties are sold, when the corporation pays on the capital gains and then distributes the proceeds as dividends to the investors. I have also read about structuring sales as sale of the stock of the real estate company, but it might be difficult to find a buyer who would be willing to buy corporate stock of a corporation owning the property rather than buying the property itself.