All Forum Posts by: Filipe Matos

Exactly, low prices may not mean better oportunities or returns. I can say its easier to get in the market without much money but I am not sure if it will be quicker on long term wealth.

You can buy cheap in windsor or some areas of US, but you also have to deal with vacancies of 10%, less appreciation, while in most other Canadian centers vacancies are 1-3% and appreciation is 5% on average,

I too feel attrached by the low prices but I will have to analyse the area carefully, future possible improvements in the area, and the property itself.

I thought about going more south or more east, I am still kinda open to it but I suffer from 2 conditions:

- I do not like to drive/commute for more than one hour

- I like to micro manage renovations. I have 2 properties in Portugal and I dont get the most of them and sometimes I lose money because I am not there. A Property manager no matter how good he/she is , its an employee, not an owner.

My target tenant is someone that is young, likes cool apartments, has sense of style, willing to pay above average rents, someone that likes to live in big cities and trendy areas.

Hamilton is close by and its a big city with up and coming areas. I can always change my mind if there is better oportunities elsewhere.

Filipe

Some people ask about foreclosures in Canada, here is an email I got from an expert in Ontario refering specifically to multiplex properties:

"Foreclosures are rare in Canada and Power of Sale is more common. The problem faced is when the lender's lawyer seizes the property, they levy all sorts of fines and fees on the deal and the deal is sold at market value minus 5%....not much of a deal anymore. Plus if you have a multi-plex that defaults, it is because they have bad tenants in them that trashed the place and the landlord gave up. Unless you have deep pockets and you kick all the tenants out and re-hab all the units, you will end up following the last landlord into another power of sale. The good buildings are mainly owned by REIT, Real Estate Trust and owned for more than 20 years and the investors are lawyers, doctors and business men that are not hurting.

Filipe

If I ever invest in Apartment buildings I guess the only way to improve the building is to offer something for the tenants to move out.

The option of applying to the Landlord Tenant Board for a rent increase might work, but I have never done it. I do not believe they would allow a big increase to cover the renovations. Whoever has been on low rents for 10 years and living in a dump would not afford to live in a nice place for current market rents.

The only way in Toronto to cover expenses is to vacate the whole property or buy cash/big downpayment.

Again, i have no experience on big buildings. maybe there i other ways to improve the building and cover expenses.

Hi Pat, about rent controls, there is no miracles here, sometimes it works, sometimes it doesn't. For over 3 units there is not much options to escape rent controls.

There is several options for up to 3 units which is what I bought in TO:

- you ask for full vacant possession of the building upon purchase.

- you move in to the house apartments. For me it works well because I buy all in a 10 minutes radius of the coolest area of TO.

- you offer them 1-x months rent free to vacate the unit

- you are lucky and they move out on their own

- you vacate the worst apartment of the building, start renovations, the rats, mice and roaches run away to other apartments and scare tenants away and they move out, even after you did everything you could to contain the pests. True story, it happened to me and I did not want them to move out, I ended up losing income and forced to renovate when I did not wanted to.

Estoril and Cascais is still one of the coolest places in the world and without colera outbreaks for decades :)

I will be there soon enjoying the beach :)

Hey man, that's what we are here for! :)

We are coming, we are coming! :)

Hi Roy, there is no deals in TO, there is only a few good oportunities for who is willing to do a lot of renovations and wait 1 year or more for those oportunities. Flips in TO may also give high returns, but I am not a flip guy.

Last year I was on a bidding war with 10 other people, it went from 6pm to midnight and I had to offer 150K over asking to get it (asking price was at least 100K under market value). I think i paid 30K over market value, but this is my best cash flowing property, with 3x 3 bedroom apartments. When do you find properties in TO for less then 700K , 3 hydro meters , 3 x 3bedroom apartments, and after renos giving 10-15% cash on cash ? ALMOST NEVER!

I invest 50K to 100K in renos and I try to get it back through refinancing, rents are so high in certain areas that makes sense.

I might get out of TO RE this year, it requires too much money for downpayment and renovations, that is why I am considering Hamilton apartment buildings where I can flip one apartment per year and rent for higher rent. We shall see if there is good oportunities there, I am just starting.

I have a normal 9 to 5 Job, I have a contractor of my trust now that does 99% of the work and I just follow up and verify the work at the end of the day if needed, I deposit the rent cheques and answer and make calls, plus deposit rent cheques, etc... It helps to have fairly good tenants. So in the end I do not waste too much time with it, I delegate as much as possible.

I work for free like stock investors do when they have to follow up the market every single day.

I am now looking at Hamilton apartment buildings with 10 apartments because I am not interested in buying 150K properties and have to manage tenants and repairs all over the place to just get $500 per property at the end of the month. So this is my personal choice, it does not mean it is more profitable, but maybe it is more profitable, at least thats is what my calculations show. Again this answer your question about working for free, I do not like to work too much for little money :)

In Toronto MADE sense for me to buy residential 3/4 plex, its expensive, good appreciation, rents are high, less work for higher returns.

I think Hamilton is no longer a Steel Town, as far as i know, as of now not even steel is manufactured there anymore. And that is probably the beauty of it, less polution, less image as a steel town, artists from Toronto are moving in, Universities are opening more campuses, families may start moving to hamilton and work in the GTA , etc...

I dont find the other GTA markets with such good prospect as Hamilton. But we have to be careful about some areas of hamilton, a lot of bad tenants out there.

Sorry Roy, We in Toronto had milked all we could out of this cow, we are kliing eachother for a peace of 100 year old property selling for 700K that needs a total gut and 100K of renos and paying 150K over asking price, competing with 10 other people on the same property.

But think about the positive side of it, we are going to start buying where you live and your properties are going to appreciate like never before because of the competition, free money without working, isn't that nice? :)

Filipe

Hi all,

I am an investor in Toronto Downtown Real estate with a portfolio of triplexes.

I have been having amazing returns on my investments (just bought another triplex in Downtown Toronto) but this year I will be researching about apartment buildings investment and management, focusing in Hamilton/Ontario. I hope to learn a lot with biggerpockets.com

I am interested in networking with other investors interested in the GTA apartment building market and open to (cash)partnerships.

Filipe