All Forum Posts by: Tom Mattinson

Here in rural Nova Scotia. I am running on the assumption that there will be no apperception in value and that the trailers will have a value of 0 at some point in the future. 

I would much prefer to be pleasently surprised then to count on something that may not happen. 

I see a lot of people posting about their first year and thought I would follow suit. 

Let me start by saying I have done a few deals over the years.  I thought the Canadian market was complicated and I had no real idea how to be successful financially as person.  I have worked in construction or around the trade for some time.  I had a hardware store for 10 years. When I closed it. I was in a position where I had nothing to show for my efforts in life save a family that I deeply love. 

I knew enough to focus on two things.  First is that it is hard to get ahead if your main job is making someone else money. The second is that education is free for the taking.  I am a fairly well trained salesman that does not want to make that a full time job. 

In 2015, I closed my hardware store.  I tried to be an employees for a time. It is not a good fit. In 2015 I re-opened my renovations business when one of my main guys that did that work for me at the store request it. 

My wife works for a significant player in the REI market in rural Nova Scotia. With a family background in rentals we had always talked about it but never really were in a place where we felt we should start.

Anyway, I said this was the first year in REI.

In Oct of 2017 I bought a mobile home on park owned land.  Older 2 bedroom 1 bath - Converted to 1 bedroom with a handicap bath. 

Purchase Price - 1500$ plus pay back taxes - $800 and back lot rent - $1200

Real Purchase Price = $3500

When you buy a mobile for this kind of price expect some rehab, That I can do most of myself, or with my guys from my renovation business anyway. 

ReHab - $4000 

Needed nothing serious but a window was smashed, needed some flooring fixed, wall repaired, a significant amount of cleaning.  All in all, nothing I found serious, I bought this place the last week of Oct and had it rented for Nov. 1st 2017. 

Real purchase price - $3500

Rehab - $4000

Lot Rent - $164 per month 

Mortgage - paid cash 

Insurance - $350/year  or $30/month

Property Tax - 653$ per year  or 55$/month

Rent - 575$/month  - never been late never missed payment 

I manage my properties at the moment so I am putting all rent money aside for repairs and re-investing 

326$ Left for the account every month 

After this property went smoothly.  I went to the park administration and I asked them about other properties in the park.  From this I found another trailer.  At this point, some people are asking me why I am buying trailers, Well, check the numbers see if they work for you. 

April 15th - Older 3 bedroom one bath

Purchase Price - $500 + back lot rent - $212 + back taxes - 379$ 

Real Cost - $1091

Rehab cost - $5600 - New Kitchen, flooring, paint and other minor upgrades 

Total = $6691

Lot Rent - 187$

Mortgage - paid cash

Insurance - $350/year or $30/month

Property Tax - 653$ per year or 55$/month

Rent - $ 750 / month

$ 478 - left every month for the account.  

** This property still needs an upgrade to the heat system that will be $2000 and has to be done before Oct 1st**

In June, I saw a property listed on Facebook marketplace that was in rough shape.  It was an 750sq ft 2 bedroom 1 bath. It was listed for 17,000.  After some work it will rent for 650$ month. I put in an offer of $10,000 and waited. 

Before I heard anything about the house, I got a call from the trailer park.  They had been surrendered a trailer.  

Older 2 bedroom with a bedroom added on, 1 bath. 

Purchase Price - 1$ + Pay the back lot rent - $1347

Rehab - $4500 - This trailer had about 8 truck loads of garbage inside it. 

Total Price - $5848

Lot Rent - $175 per month

Mortgage - paid cash

Insurance - $350/year or $30/month

Property Tax - 653$ per year or 55$/month

This trailer rents for $650 a month. 

Leaves $390 for the account per month

So breakdown of the trailers looks like 

650+575+750 = 2050 

Lot rents = 525

Insurance = $100/month

Property Tax - $150/month 

For the account - $1275 

(yes, I know the numbers don't add up perfectly, I just went off the top of my head) 

On a Wednesday   I heard that my offer of the 10,000 went through on the house. 

On Friday the Real Estate agent I like called my wife and I.  There was a property about to be listed Monday It was a single property of 2 triplexes.  Each was 3 beds and one bath.  The buildings were somewhat neglected. It was not so much willful neglect just that the former landlord and I have different versions of what is acceptable and he was getting older and not so on top of things.  

Asking Price - 179,000

Accepted offer - 174,900 - (written and accepted on the Monday) 

Of the six tenants, 4 had given notice by the closing date. 

Legal Fees $2400 

Deposit Required for the mortgage - 20% - $35,000

Right now rehab - 22,000

Property improvements and correction of deferred maintenance over the next 2 years - additional $24,000 

Mortgage payment - 871$ / month

Water - app $200/month

Property Tax - app. $300/month

Grass/snow - quoted by a local company at $274/month (1800 for snow for the year, 1500 for grass for the year) 

Insurance - $140/month (got a great rate not cheap insurance) 

The heat source and hot water is natural gas, New furnaces and water heaters installed in 2015. 

Heat and lights depend on the month, size of the family all those things, so I want to use the average of $250 per month

Some of the rents were set by the old landlord, and for the sake of writing this today and not in November, I will include the rents from the 3 properties that are rented Oct. 1 and Nov, 1st. 

Unit 1 - 950 - all included 

Unit 2 - 525 - nothing included - old landlord set 

Units 3-4 and 5 - 1100 all included 

Unit 6 - 600 - nothing included. - old landlord set this one too

Total Rents 

5,375 

- expenses as above - 

Leaves 2,590 for the account.  

So, in the run of a year, my wife and I went from 0 passive income to about $3,800 a month.  I still have people that kind of laugh when we talk about the trailer.  Some of you have noticed that I did not talk about the $10,000 house.  Well the thing is there, that it needs rehab.  I used the money for that rehab to get the 6 unit deal done.  So, It will be spring before that is a money maker.  

I feel like I am running on and on.  I am going to stop now. I am looking to keep doing this. I am looking to get to a point where I have 100% of my needed passive income within 15 years.  I am sure every year wont be this productive.  Thank you here for the posts and information.  It helped me. 

I am over in Nova Scotia. I know there is a lot of opportunity for investors in Canada. 

I think you need to work on the 80/20 rule. You can start investing with very little here in Canada. It is not a quick process but getting started is more then half the battle. 

Tom

I think you are very much on the right track already.

Any profession that puts you in front of or close to the re market will help you as an investor. 

If you have what it takes to work for yourself there are huge advantages(pros) but it can also cost time and money (con) to get up and going. 

You have to look at where you are and whete you want to be. From there i think your own interests and skills will guide your career. 

Tom

I would be interested in a deal like this. 

Mobiles are known for a few kinds of issues. I would want to see them before you should ever buy. 

There should be a budget for repairs. If they are telling you that they are not spending on repairs that would be a red flag. At best you would be buying defered maintenance and at worst. A shack. 

Its not really a MHP is you own every trailer and the land. 

This deal would be something i would think worth a close look. 

Tom

Hi There, 

I will be relocating my property management services to Lawton but not for a while. So I am no help on that front today.  I am kind of well versed in the Lawton market.  At this exact moment I would suggest caution.  

Fort Sill recently has a major on base housing project that could last for sometime yet.  That means that the 2 year wait list for housing on post is now 2 weeks.  Military persons normally bought 80-150,000 homes.  Or they would rent those kinds of homes while they waited.  A property that rented for 1150 before the building on post is now renting for 900.  There is a huge amount of homes on the market and for sale off market.  It is a good opportunity if you can afford vacancy but I would suggest when you do your property screening that you double what ever you are using for vacancy now.

Send me a pm and we can see what your looking for and what assistance I can offer

You should come this way its really nice country over here.  If you do, send me a P.M maybe we could do coffee or something. 

I know of a lot of turnkey opportunities here on the East Coast of Canada.  I can connect you to: Real Estate Agents, Property Managers, Contractors, anything you want. 

What are you looking for?  @John Humphries ,  I mainly know people East of @Roy N.

There are opportunities here, lots of weekly rentals, lots of Single-family properties that go super cheap, lots of commercial/residential or just commercial, anything you want really.  To say this area does not work...  I know a lot of companies here on the east coast that do big numbers.  In fact; an 85 unit deal just closed very close to me.   I know of both large and small builds for sale. 

Let me know if any of this sounds interesting and I will connect some dots for you. 

Tom 

It is something we certainly do here on the east coast. 

I have been in 2 real estate offices in the last couple weeks that had the list on display. It is not something that is easy.  Here on the east coast there are say 20 properties in an area, likely half those won't make it to auction as the owner will deal with the taxes. The rest you have to look at value and they are typically not really worth more than the taxes.  If these factors were not sufficient to discourage you there is the fact that there is a group of Real Estate investors and lots of novices that research these deals and go to the auction to see if anything goes too cheap. 

Normally,  you could contact a town clerk or phone the office you pay property taxes at for a given area and they are happy to tell you more about where and when the auctions are.  In my experience, there is an email list you can be put on to receive postings of anything that comes up for sale. 

In Canada, you have 2 things to look at on any property, 

Is it redeemable?  If a property is posted for auction you may win the property but that does not mean you own it.  There is a length of time that the owner has the right to simply pay you back your money, plus a little interest and they own it again.  Once that length of time has elapsed, normally 90 or 180 days, you own the property.  

While you own a redeemable property you are still responsible for upkeep. To be specific you are responsible to keep the property in the same condition you bought it in.  So, if the roof leaks, you get to fix it.   That can sometimes work in your favor. If you own a house that is redeemable, you have to apply to fix anything. If you get permission, you can put that bill on file and the owner has to pay that bill as well as your payment plus interest to redeem their house. 

The Second is other liens. I would not say that you should never buy a property with a lien on it but it is something you have to know.  That means looking into the title of the property.  Bottom line is that even looking at a property seriously is going to cost you money.  Different areas have rules that they won't post a property for auction till the taxes reach 40% of assessed value or some other %.  It is really hard to work in these areas as you can never get a great deal.  There is a process to pay less for a property then the overdue taxes but it is not common and you need the clerk to help.  You need to have them post the property for sale by tender.  I have seen this kind of arrangments made in smaller towns.  No idea if that will work for you out west.  

If you have any questions, I am happy to answer what I can, just send me a connect request and pm. 1