All Forum Posts by: Hadi Komeyl

welcome to the BP Mathew! nice to see a fellow Canadian!

Hi all,

I am interested in the commissions involved with a construction loan for a new home in Canada or down south. Could fellow BPers advise on the following:

1. how much do brokers make on a new mortgage. Base on my research its somewhere around 0.5-1% (excluding the brokerage's fees).
2. how much do brokers make on "construction loans"? The rate for these are 8-9% /yr based on your equity to loan ratio. To clarify, a construction loan is obtained once the foundation of the house has been completed and is paid our in instalments.

I tried searching the forums and googling for a while, but no luck. I would appreciate everyone's feedback. I would greatly appreciate everyone's feedback or a link would be helpful too, although I dont think brokerages would advertise this.

Hi Shahrian,

1.In Canada we don't have LLC. The closest thing is a corporation (source). Definitely recommended if you want to limit liability.

2.Best way is to make it your primary residence. Here are some options to consider:

1., Canada revenue agency (CRA) policy states:

"If the property was your principal residence for every year you owned it, you do not have to report the sale on your return. However, if at any time during the period you owned the property it was not your principal residence, you may have to report all or part of the capital gain". (source)

2.your second option is make your corporation and buy it as if the company owns it, which allows you to write off a lot of the expenses and defer taxes, but getting a mortgage for a corporation would be hard.

3. There are lots of trade-offs, and its the last thing anyone wants to hear, but unless you are willing to learn all the details I would recommend talking to a Chartered Accountant to find out what the best structure is for you.

I had a very similar, tax related questions when I first joined, Roy N was kind enough to refer me to this book: http://www.amazon.ca/Accounting-Strategies-Canadian-Estate-Investor/dp/0470677732/ref=pd_sim_b_13.

Best of luck,

hadi

Hi Matt, welcome to BP! There are a good number of Canadians around as Roy pointed out.

Best of luck!

Hi all,

I have been doing lots of reading and research in the past month. BP has been incredibly helpful, especially the forums, the beginners guide and "the book on flipping houses". I have also started also started working with a local contractor as an apprentice to learn more about rehabbing. All the going great, expect I think I am having what the BP beginner's guide calls "analysis paralysis".

The Tornto, Canada, RE market is very difficult for me to comprehend. Without getting into the nitty gritty and referencing tonnes of articles, this is my understanding of what is happening:

1. Lots of condos are going up in Toronto. Many are "investment" properties that either to be either rentals or resold.
2. cheap borrowing costs have resulted in lots of people who cannot really afford to live in a house to buy houses.
3. My biggest worry is that recently bonds the US have gone up, and therefore borrowing costs have gone up. This will result in Canadian banks also increasing interest rates in the near future. This may result in people defaulting on their loans and so on....

I would love to hear what the BP community thinks!

First off I would like to say I am SHOCKED at how quickly I got responses, I am glad to be part of the BP community!

Roy, thanks very much for you advice. I will definitely have a look at the book.

Denis, I just want to get my feet wet, so I am considering properties north of Toronto (e.g. Richmond Hill, Vaughn, Markham etc.). I think North York is by far one of the best markets in the GTA, once I have some capital I would definitely like to make a move on that market.

Paul, thanks for the warm welcome.

Can anyone please recommend a book or resource (e.g. website, blog etc.) on the mechanics of renovating and flipping? What to look for? Warning signs of a failing structure? etc.

I have come across a lot of great resources on BP but I am looking for something more consolidated. Thanks in advance.

Hi all,

I live in the Greater Toronto Area (GTA). I am Civil Engineering E.I.T (Engineer in Training), specialization: Structures (i.e. structural steel and concrete), in the GTA area. I have worked at a few consulting firms as an EIT on heavy civil/structural consulting jobs. I have also worked on large condo development sites as a construction inspection. I am looking to shift my focus todays RE investing to gain freedom! to do what I want when I want!

I have been involved in my dad's RE investment ventures for the past decade, they were mostly passive (investments) in nature. I am interested in expanding my network and getting to know more people in city and the industry!

Considering my experience I would like to start my doing some renovation+flipping projects.

My biggest fear right now is TAXES. My understanding so far is that if I buy it & flip it through a company 100% of the profit is taxable (note that the big benefit: reduced liabilities). On the other end of the spectrum, buying it personally and living in it for one year will allow me to sell it without paying taxes on the profut. Alternatively, selling buying it personally, and flipping it within less than 1 year, the profits are considered capital gains (taxed @ 50%). Any help on this topic would be greatly appreciated!

I would also like to get involved in the BP so if there is anything anyone needs help with I'm here for you. I very good with anything numbers related (including excel), structural design (e.g. structural steel/concrete), and I know the GTA market well.

Feel free to add me a colleague to get more info on experiences and how I can help.

Thanks for reading my post! Looking forward to your response :D