Archives for April 7, 2015

How much time of you free time is spent doing productive things? After adding up all the hours we are awake over the course of the week then subtracting the work hours/travel time/kids/sports for the kids we are left a finite amount with which we can better ourselves.  How much of that time is spent watching TV? Shopping? (cue dramatic sound) Messing around of social media sites (not for business)? Try keeping a time log for a month and the results could be shocking indeed! When someone decides to get into real estate investing in Calgary or anywhere else in Canada, they have often taken a seminar that told them they could make a large amount of money in a short period in their free time after work.  This could be true in some rare cases but at it’s core real estate investing is a patience game – not a get rich quick scheme.  Real estate Investing also requires a large, focused, and sometimes tenacious effort to get things done and deals closed.  This also requires a very large investment of time to make the business successful and find the right deals, negotiate them, and execute them for those that have a couple hours each day to devote to real estate will likely be very disappointed with how far they are getting and how fast.  When you decide to have a hobby such as scrap-booking, photography, puzzles, or poker you could do those things for as little as 1 hour per night and if you missed a few nights due to work or what I like to call “life happens” then no big deal – you can always pick up where you left off some other day no harm done.  Also, you could have a bunch of hobbies that you can alternate back and forth causing to real detriment to any one thing you do in your spare time.  If you plan to get into real estate investing and also plan to make money, then you have to focus on a few things at a time to find deals/profit from them and find a system to make those activities repeatable.  Investing in real estate is at its core a patience game that takes long hours, fierce commitment, and often competition just like a race to the finish line having to beat out other investors to get the best properties.  Don’t get me wrong, you can have a successful career or other job and still be able to invest in real estate – you just need to become very strategic with the time you have available outside of that career/job.  Most people that decide to get into real estate investing took those seminars that told them they could make huge money in a short period of time only spending a few hour each week working on their business.  This may be true in some very rare cases, but those are the exception and not the rule!  Real estate takes a lot of effort, the mistakes are very costly, and a lot of precious time: s0 a hobby-like commitment will not get you the results you are expecting.  I would say that part time hours are the most effective way to look at scheduling your real estate investing business, especially in the start up phase for the first year when you are building your network, anything less will get you moved forward but at a lot slower pace.  Think about it, start a time log for a month, after all do you want to be a turtle in real estate investing “hobbying” along or a swift fox chasing down that next deal?

To your success!

Tim R

Rent to own has 2 main strategies and today I would like to talk about the best fit for the Calgary market at the current time.  Both strategies still work, so those sandwich lease advocates can still work their magic but they will be having a tougher time finding motivated sellers willing to get their payments covered.  Tenant first rent to own is the strategy that investors use when they have credit to qualify as well as down payment dollars to fund bank mortgages.  This method works very well because you get to qualify a tenant buyer, let them loose with a realtor, then they PICK the house they want to use for the rent to own program.  These tenant buyers will normally need very little credit repair (hopefully none) and they make good money from being a self employed business owner, or just simply do not have the whole down payment saved.  This high quality tenant buyer will be much more likely to close because they do not have the credit issues, as well as picking the house they wanted to live in makes them much more invested in closing the deal at the end of the term.  Tenant first works well if you have large capital reserves/credit capacity, if not you will run into the “brick wall of finance” with these just like buy and hold investors because you need new mortgages for each deal you plan to do.  This is where partners come in, you will have to seek out joint venture partners to help you qualify and put in the down payments to gain new mortgages for each new deal.  There are many people out there looking for a better return on their investments and rent to owns almost always have double digit returns year over year – that you can count on unlike mutual funds!  Once the investor has seen the returns for the first deal they will be more than happy to do more with you so long as each deal is a win-win for both parties.  Tenant first rent to own deals can sometimes be closed in less time because they buyers often have more money up front for the option deposit, and are often more motivated to close on the home to be able to call it their own!  Rent to own is a great strategy to help people realize their dream of home ownership.  Rent to own has two flavors, this one works best for the “taste” the Calgary market has right now!

To your success!

Tim R