All Forum Posts by: Steven Silman

@Oliver De Ausen Good work! Dayton looks like a good market for cash flow. Don't forget to set aside a percentage for capex and vacancies if you haven't included them in your categories. All in all, looks very worthwhile!

@Tomislav Glamuzina Congrats! Sounds like much was learned and you're on your way! I presume you're self-managing, as I don't see a management fee. Depending on age, many investors budget 5% of the gross rents towards maintenance and the same for vacancies. A newer place (and/or house instead of condo/apartment) may need less for maintenance, while an older one will typically need more. Vacancies are probably less than 5% in your area but I would encourage you to set that much aside every month if you can, at least until you have enough to carry the expenses for a month. Vacancies happen at the darnedest times, and having some money set aside allows you a bit of breathing room to be picky about the tenant you choose.

Negative cashflow can be acceptable in a market that is clearly rising but only as a short-term strategy, in my opinion. If you are counting on appreciation long-term then you are speculating more so than investing.

@Ellie Nasir Originally I didn't do much work myself but by starting with the easy-ish stuff (painting, landscaping, labour) and challenging myself with progressively harder things, I learned a lot and saved a lot of money. Youtube is a good source of info, and if you enjoy the work, you could consider a change of careers, like I did. On the other hand, be aware of the value of time - if you need to move quickly, be prepared to bring in experts to do what needs doing. If you save money doing something yourself but it takes a long time it could cost more overall when factoring expenses in financing, opportunity costs, etc.

@Cassidy Osgood Shared walls are normally specially designed for fire separation and putting in recessed shelves would almost certainly mess with that. Talk to your HOA/strata and municipality to find out what is and is not allowed. If there is a fire in the future and you made a change that compromises the integrity of your unit and the unit next to yours, you could very well be held liable, with potentially very serious consequences.

@Jeffrey Kay First off, make sure that you will be able to short-term rental - many municipalities and stratas (HOAs) have been restricting them. If you were to lose that ability, would long-term rental money be enough that it would still be worthwhile? Also be careful to not act just due to FOMO - if a deal looks good or you sense an opportunity then go for it but try to remove emotion from your investing as much as possible.

Hi @Elijah Williamson, I've owned in both big cities and small towns for years, places with tons of appreciation and others with not that much. In my experience, the biggest issues with owning in a small place are sourcing good property management/trades, getting good financing and exiting. More than likely your appreciation will be significantly lower than in a larger community but as long as you go in aware of that, if overall it makes sense to you then you should go for it. Good luck!

Sounds promising. Some markets are like that, usually in transition periods. Suggest you triple-check your ARV and your conversion budget and then give it a try. If it works, then rinse and repeat.

@Tomislav Glamuzina probably the best lesson I learned is to keep your expenses low and be prepared to move quickly so that when you spot a good opportunity you're ready to act. Also, early on especially, be conservative in all your projections - things usually cost more and take longer than you plan for, at least if you're an optimist like me! I can echo what @Jordan Perry said about financing - work with someone who is familiar with REI and you can share your entire plan with. That way you can setup the financing to work for the current purchase and not compromise the purchases you're planning in the future.

@Tomislav Glamuzina it's an expensive market relative to other places because of the cost of land. Labour costs and government-related costs can be a bit high too (permits etc) but it's mostly the land. If you're able to bear those costs then BRRR away. You'll want to move quickly when you do act, in case the market shifts under you, but there is money to be made. I would look at the local areas you are interested in and look at your financial resources. Focus on smaller projects to start and be opportunistic. If the local market is too expensive then I'd suggest areas not too far away that are less expensive, maybe further out in the Fraser Valley or on Vancouver Island. Your experience, financial resources, and flexibility will all dictate where you can operate. As far as other strategies that can work in the Lower Mainland, I think house hacking is worth looking at. Helps keep your expenses low(er) and you learn some of the ropes in the process.