Get Real Wealthy

Quentin DSouza

Real estate investing in Canada can be confusing. You own your first home, but where do you go from here? How do you build your portfolio and your wealth? The confusion ends here. Quentin DSouza is your host, an award-winning real estate investor and founder ofAppleridge Homes, which started with small single-family homes in 2008 and has grown to large apartment buildings and growing towards 100 million+ in assets under management. On this podcast, you'll learn how to take your high-income, and your first home, andmove into the ultra-rich with our lessons from how Quentin and many others did it withreal estate investing. Connect with Quentin at https://linktr.ee/qmanrei
0 -Introduction - Who is Quentin D'Souza?
Introducing Quentin D'Souza, Host of the EducationREI podcast. Get insight into his background and experiences in Real Estate Investing. Show Notes: Getting Started in EducationREI series is an opportunity for you to be a fly on the wall of some of the conversations that I have with different members who are part of https://educationrei.ca (EducationREI )and https://durhamrei.com/ (DurhamREI). I wanted you to get a sense of some of those conversations, as well as how I'm helping them in their real estate business, and how sometimes they're helping me in my real estate business. Just so you know who I am. My name is Quentin D'Souza, I'm an award winning real estate investor, trusted authority of investing. I'm certified teacher, I hold two university degrees, which includes Master's in education. I quit my job in 2014 as a as a teacher with the Toronto school board, I was there for about 20 years, I quit at 40 years old. And I haven't looked back since. It's been a really interesting and gratifying experience to move away from the public system where I was in on the sunshine list, which was, it's basically public sector employees who earn over $100,000 was on my way to be an administrator or principal in the system, and decided to focus all my time on my own business. I've appeared on local and national television and radio. I've been interviewed in national publications. I've been a keynote speaker to large audiences of real estate investors. I'm a proud member of the entrepreneurs organisation which has certain criteria to be accepted. I have been accepted in Tiger 21. Again, which is an organisation that has a certain net worth that is required to be accepted. You could look both of those up. In my company Appleridge Homes, I use the buy, renovate, refinance, rent (BRRR) long term rental properties since 2008, started off with single family homes moved, over to apartment buildings, where I focus now. Im investing both in Ontario and in the US. My Portfolio really focuses on Win Win relationships between myself and the people I work with. We currently have over 75 million+ in assets under management. I'm the author of multiple books http://www.theontariolandlordtoolbox.com/ (The Property Management Toolbox: A How-To Guide for Ontario Real Estate Investors and Landlords), http://www.theontariolandlordtoolbox.com/ (The Filling Vacancies Toolbox: A Step-By-Step Guide for Ontario Real Estate) http://www.theontariolandlordtoolbox.com/ ( Investors and Landlords for Renting Out Residential Real Estate). I co-wrote a book with two friends of mine http://goo.gl/Kp5UjA (The Ultimate Wealth Strategy: Your Complete Guide to Buying, Fixing, Refinancing, and Renting Real Estate). And my last and latest book,https://amzn.to/3jjtXLg (The Action Taker's Real Estate Investing Planner), which is half book and half planner that helps you to achieve your real estate goals. You can find any of those books on Amazon. I no longer offer coaching but I mentor real estate investors through the club and you can listen to those conversations or at least some of those conversations through this podcast. I hope you enjoy your listen and if you'd like to learn more about the club, you can visit https://durhamrei.com/ (DurhamREI) or https://educationrei.ca (EducationREI) enjoy the podcast
4 mins
1 – The Blueprint to Financial Freedom with Real Estate Investing
In this episode, I'm talking to a new member of EducationREI.ca, where we get them familiar with the material, find their goals and direct them on where they can get started working toward those goals. Quentin talks with a new member, who moved to Canada in 2006 as a first-generation migrant from India. He became interested in real estate in Canada while working at one of the top five banks in Canada. Meanwhile, he used the buy and hold strategy in India. After marriage, he and his wife decided that they wanted to become homeowners, which they were able to achieve. Now, they want to achieve financial freedom, and want to start with some cash flowing properties. To sustain their lifestyle, they are looking at an income of 100k. Talking about what the financial freedom looks like for him, he says that it has more to do with the time, what they could do, and the location they could be at. Quentin shares a complete blueprint to help them get started with real estate investing. He says that if you've got 500k and you want to create $8,000 a month for cash flow, as you're investing in property, you’ll end up with cash flow that starts off smaller but increases over time. At the same time, you need to be careful. He adds that cash flow helps you to hold on to an asset, but what is really going to make you money is the mortgage paid down and the capital appreciation with that product. Over time, as you own that asset, let's say five to 10 years, then you can refinance the property. You can also use the cash flow to help support your income. He says that you have to have a longer-term mindset, there's too much of a day trading mentality when it comes to a lot of things, which is as true for real estate as it is for the stock market. He adds that the way that you do well is, you have to invest in markets that are both appreciating and give you some cash flow. You can find cash flow by doing different strategies; working privately, networking with other investors to find opportunities, looking at areas along the 401 Corridor, etc. He recommends the courses to start off with is ‘Your First Million in Real Estate’, to learn some of the fundamentals that you want to be looking for when you're looking at all these markets. He further adds that you need to stay away from some of the smaller communities, because they can have these big rushes of appreciation, that can go on for 5, 10 years, but then they'll have flat periods. People don't see the flat periods because they don't have a long enough memory to be able to see it. Quentin says that you've got to keep that in mind when you're looking at different types of investment property, not just cash flow. He suggests him to do his own research first. With regards to accessing funds, he recommends financing at this point. At the very least, a line of credit; home equity line of credit as a component of the mortgage, so that the mortgage payment amount doesn't change but you have access to the funds, as a secured line of credit. Then as you go along, you're going to look at the joint venture course. Quentin then suggests that he should go back to the meeting and listen to the meeting recordings because that is where we talk about what's happening right now, what areas and what strategies are working, where people are buying – those are the things that you really want to go in and listen to. Rather than the reports, he says that the videos would be more helpful. In conclusion Quentin says that EducationREI.ca is essentially an education platform for people who are investing in other places, it's more about the fundamentals of real estate investing, the Q&A calls, the meetings and the connections that you make. Topics Discussed ·        Introduction [00:00:00] ·        What Was His Experience Like and What Were His Returns While Investing in Real Estate India? [00:04:50]...
30 mins
2 – Career Change Using Real Estate3 – The Beginner4 – From Negative $3000 to Positive Cash Flow5 - Leveraging Existing Equity to Purchase Investment Properties6- Living Off Your Investment Properties and Flipping for Profits ( BONUS: Converting RRSPs to TFSAs Tax-Free)7 - Moving Properties From Personal Name into a Corporation
Episode Summary In this episode, Quentin talks with a member who is who is upgrading to a larger principal residence, they need to move their properties from their personal name into a corporation in order to create qualification room. The member shares that he started his real estate journey after attending a real estate conference. He started with student rentals, and over the years, he managed to build a portfolio of fifteen properties that includes student rentals, duplexes, single family homes and some condos as well. He says that as he purchased properties in his personal name, with a trust agreement to the corporation, now he is unable to qualify for a bigger mortgage when he wants to get a bigger house. Now, he wants to move some of his properties from his personal name into his corp. He shares that when he was building his portfolio, he used his personal residence for my personal residence. So, now he has a huge credit line on his personal residence that as he moves this over, he is going to take those proceeds and pay himself back and free up debt on his personal name, so that he could buy a larger personal home. He adds that his primary objective is qualifying for a larger home, secondary is paying off his debt, refinancing and freeing up equity in those properties. Quentin says that the member needs to look for a portfolio lender, that's going to take on all of those residential properties and bring them over. He suggests that the member should approach the commercial lending department versus the residential lending, and ask them to give a portfolio loan against all four at the same time. They have the same payment structures as a variable rate mortgage. The rates are higher, but they have the same of flexibility for selling one out of the portfolio. He adds that with the B lenders, the rates will be even higher. He also adds that the challenge that the member will have is the student rental component, because that's not favourably looked on by the lenders. He says that another option for him would be credit unions, and they may be able to offer him different options as well. Quentin adds that his joint venture partners are going to have to qualify on those mortgages as well when he is bringing them over. If those are personally owned and not JV properties, then there shouldn't be an issue. In conclusion, Quentin suggest doing it in stages. Stage one is flip it over from personal to corporate, and then stage two, access equity later on. Topics Discussed • Introduction [00:00] • His Background and Experience in Real Estate Investing [00:50] • What is the LTV on the Properties He Wants to Move? [07:03] • Is He Using the Smith Maneuver? [08:22] • Does He Have a Bear Trust on the Properties He Wants to Move? [09:45] • What are the Paperwork Requirements For the Process? [16:08] Important Links • https://EducationREI.ca (https://EducationREI.ca) • https://GetRealWealthy.com (https://GetRealWealthy.com) • https://DurhamREI.ca (https://DurhamREI.ca)
24 mins
8 - Should You Quit Your Profession To Move Into Real Estate Investing Fulltime?
Episode Summary In this episode, Quentin talks with a member who is looking to quit her profession, and move into real estate investing full time. We explore flipping and discuss other strategies as she wants to get started. The member shares that she has been working as a secondary teacher for the last 12 years, but she has always been business-minded. She learned about the foundations of real estate investing from her father. Now, she wants to start a new career in real estate investing and even interior design at the same time. Now, she wants to learn about the best options that would allow her to quit her teaching career and move into real estate full-time. She shares that they have an increasing line of credit so that they can use it towards investing and purchasing an investment property. She also bought a small condo in Calgary, which was zero money down. Now, they have around 250k available in the home equity line of credit as well as some savings. Quentin adds that strategy is really important, but it's also important to figure out timelines. Quentin shares that anything is possible, and it's always dependent on your commitment to be able to do anything. There are lots of great investing strategies, some require you to be more active and other ones are more passive. He adds that the properties should be cash flow positive and gain appreciation. It takes time to build up properties and especially if you are doing it the first time, it'll probably take you a little bit longer. As for flipping properties, the timeline is shorter, but it requires more work. It requires you to either find properties off market or work with wholesalers. Rent to own is also a strategy that helps you to create income. While the member is interested in flipping, Quentin adds that every strategy has its pros and cons, and he recommends joining the bi-monthly Q&A calls sessions to learn more about which strategy suits her the best. She shares that she plans on acquiring a property to flip, but if it doesn’t work, she would use BRRR as an exit strategy. Quentin adds that it is great to have multiple exit strategies. He says that in order to do to be successful at a flip, you need to actually buy the property with some equity in it or solve a problem, and not off the MLS. He suggests going through the Negotiating With Private Sellers and Off Market Deals courses. He adds that in real estate, you need to know your numbers more than everybody else. He also suggests getting on some of the buyers lists by people who post We Buy Houses signs, as they're looking to most likely assign some of those deals, and those are the opportunities for potential flips. Quentin also suggests finding somebody who's already done flips, and partnering up with them. That way, you can see the ins and outs of how the process works, what they do, even if you're a money partner. He adds that “a lot of people think that real estate is about bricks and mortar, it really isn't. It's really about the relationships that you build with people.” In conclusion, he recommends getting on wholesale lists, so that she doesn’t have to pay commission to the realtor, and partner up with somebody who has successfully done flip projects. Topics Discussed • Introduction [00:00] • Her Background and Experience in Real Estate Investing [01:04] • Does She Have Any Equity in Her Primary Residence? [03:05] • How Much Equity Does She Have in Her Primary Residence? [03:50] • When Does She Want to Leave Her Teaching Job [04:31] • Which Strategy Does She Want to Focus On? [07:50] Resources Mentioned • https://educationrei.ca/ldcourses/negotiating-with-private-sellers/ (Negotiating With Private Sellers ) Important Links • https://EducationREI.ca (https://EducationREI.ca) • https://GetRealWealthy.com (https://GetRealWealthy.com) • https://DurhamREI.ca (https://DurhamREI.ca)
22 mins
9 - Real Estate Investing Through a Corporation or Your Personal Name?
Episode Summary In this episode, Quentin talks with a member who wants to know whether he should start putting properties under his personal name, or under a corporation. We explore the pros and cons of each option. The member shares that he is a fairly new investor, who started just a year ago after reading the quote “If you have only one job, you're this close to a poverty line…” He shares that he has closed on a property in Hamilton and is about to close on a second property in April as well. He says that he is looking for niche properties where he can find big lands and use the BRRR strategy. He is currently converting it to a second suite while also preemptively working for the third unit. As for his second property, he says that he could do two or more dwelling units. He could build a triplex and go up to six units if needed. Quentin says that focusing on one area, in the beginning, is a great way to build geographic expertise, he adds “don't invest too much money in the pre-planning phase, do the stuff that's behind the walls, but don't do the stuff that's expensive…” On the subject of having a bare trust agreement and a corporation, Quentin adds that having a corporation is quite beneficial, but when you're working in the one-to-four-unit range, you really limit your financing options, if you are already going with a lender that will allow corporations, you might as well use it. He suggests putting it in a corporation if you are intending on growing the portfolio. Quentin also suggests him to talk to his mortgage broker to plan that process. As for leases, Quentin says that he could have it as a property management company. Additionally, moving from personal to a corporation can have tax consequences. He adds “you may want to send your accountant the trust agreement, before you close on the property so that you show them that the intent was always to have it in that bare trust agreement.” He says that he is also recommending people to move to corporations because of potential tax implications in the near future. In conclusion, Quentin says that he can do a Section 85 Rollover to include the first property. He also adds that that in BRRR, avoid going into a fixed-rate mortgage, and go into a variable rate product. Topics Discussed • Introduction [00:00] • His Background and Experience in Real Estate Investing [01:03] • What is the Cashflow on Both of the Properties? [05:27] • Is a Bare Trust Agreement Good Approach for Him? [09:22] • Whose Name Should Be on the Bare Trust? [12:54] Important Links • https://EducationREI.ca (https://EducationREI.ca) • https://GetRealWealthy.com (https://GetRealWealthy.com) • https://DurhamREI.ca (https://DurhamREI.ca)
20 mins
10 - Best Strategies for Getting Started
In this episode, Quentin talks with a member who is looking to get into his first property. We explore some strategies and some locations that might fit his budget. The member shares that he has been a member of DurhamREI Facebook group for the last two years. He became a mortgage broker in 2019. As for his real estate career, he is looking to do private lending. Following COVID, he was forced to work in retail full time, but he aims to pursue both real estate investing and his mortgage brokering career. He shares his experience of losing insurance and having to refinance his house twice when he owned a restaurant. He wants to build his net worth and get more into the real estate investing side and be the managing partner of joint ventures. Quentin adds that if he has the funds available, and wants to partner with somebody, he should focus on partnering with a flipper. He adds “you always have to see how you can add value to like what somebody is doing, in order to make it more valuable than just what it is that you have.” Furthermore, he says that if he can’t qualify in Durham, he might want to look a little bit further out from Durham for properties. Quentin says that high cash flow requires a bit more work, and he suggests hiring a property manager. He recommends looking at Peterborough student rentals, or even Peterborough rentals, as they produce better numbers. Apart from Peterborough, areas like Kingston, Bellville and Cobourg also have the potential to produce good cash flow. He adds “If you can get a duplex, have two rents and hire a property manager and still cashflow four or 500 bucks, that's what you're looking at.” He further says that once you get one or two under your belt, then it's easier for you to go to the next person and say, look, this is what I'm doing. Do you want to do it together? And then we can, you know, we can do a partnership. As an investor, the focus should be on putting in quality property management. Quentin also says that knowing the fundamentals of what makes an area a good area is crucial, because and cheap doesn't always mean good. In conclusion, he suggests going through the First Three Rental Properties and Joint Venture Partnerships courses, and then start talking about what he is learning as he goes along. He adds that “you need to find and talk to the people who have been successful, and then you listen to those people because they'll help you to get to where you want to go.” Topics Discussed • Introduction [00:00] • His Background and Experience in Real Estate Investing [01:25] • What are His Future Goals in Real Estate Investing? [04:40] Resources Mentioned https://educationrei.ca/ldcourses/your-first-three-properties/ (First Three Rental Properties Course ) https://educationrei.ca/ldcourses/raising-money-for-real-estate-system-joint-ventures/ (Raising Money for Real Estate System: Joint Ventures ) Important Links ·        hhttps://EducationREI.ca (ttps://EducationREI.ca) ·        https://GetRealWealthy.com (https://GetRealWealthy.com) ·        https://DurhamREI.ca (https://DurhamREI.ca)
20 mins
11 - Get More Flexibility in Real Estate Investing with Variable Rate Mortgage
Episode Summary In this episode, Quentin talks with a couple who are just getting started in real estate investing. We explore the difference between getting a fixed or variable rate mortgage, and why variable rate might be a better option. The couple shares that while both of them have corporate jobs, they are looking at real estate investing as a way to achieve some level of financial freedom.  They purchased the property in Burlington four years ago. Quentin shares that he started real estate investing in a similar manner, and while it was a big step, it worked out well for him, adding “because I had rental properties that were paying every month, and it allowed me to do other things give us flexibility.” He recommends going through the “Your First Three Properties in Real Estate” course, to get a better idea of fundamentals of choosing an area with where to invest in. He adds that if they've owned the property in Burlington for four years, they probably have some equity built up in the property. A lot of people who start off investing in real estate, and how Quentin and his wife and started as well, is by using the equity in their property to get started. Talking about the available credit Quentin suggests that they should go back and see if the lender will allow them to free up more of their home equity line of credit, so to reassess the property in order to access it, that will give them more funds to work with.  Quentin continues by saying that the numbers have to work, adding “so, if you're buying a single-family home, it's not going to work because you're the mortgage, your property taxes, your insurance, like the rent that you collect is not going to be not going to pay for that. So oftentimes, you'll have to look at different areas that make more sense for you in order to purchase them so that the rent is higher than the property taxes, insurance and mortgage payment.” Talking about the investing in smaller markets he adds that oftentimes, they'll go up, and then they'll go flat for a while, as well as other challenges. They can also buy single family homes, which are easier to manage so they can offset each other. He also adds that they will have to be a little bit more creative to access funds, such as unsecured lines of credit. Those lines of credit can be used for renovations, where you can refinance, and then pay back the high lines of credit, and then hopefully pay back some of the lower line of credit to like their HELOC.  On the subject of fixed and variable mortgage, Quentin suggests that they should try to see if they will flip it to a variable rate mortgage. This will give them more flexibility and will allow them to able to access more funds on from the home equity line of credit when they do the refinance. He adds “educate yourself on what is a good real estate investment, and how to work with those three team members, and when you do that, it'll make it a lot easier for you when you're talking to them about picking the right property.” In conclusion, Quentin says that investing in real estate can really change your life, and he encourages them to continue down this path, as it's well worth it. It can be life changing because it can create a stream of income each month, and then there are big chunks of net worth increases, because of the properties that owned. He adds that real estate is not about houses, it's about relationships, you create a good relationship with other people, then they're willing to help you and what goes around, comes around. Topics Discussed Introduction [00:00] Their Background and Experience in Real Estate Investing? [01:08] How Much Equity Do They Have in Their Property and Do They Have Any Funds Set Aside for Investing? [05:24]  What is the Current Value of Their Property? [06:30] Have They Thought About Investing in Any Particular Area? [10:03] Do They Have Any Unsecured Lines of Credit? [11:50] Why They Should Switch from Variable Rate...
26 mins
12 - When You Should and Shouldn’t Consider Rent-to-Own Investing
Episode Summary In this episode, Quentin talks with a member, who is thinking about getting into rentals. We explore what his long-term goals are, and what might be the best strategy to start with.  The member shares that he has been involved in private mortgage investing, as a source of passive income. Now, he and his wife are interested in changing careers by leaving the corporate world and starting their own business in real estate investing. They are also working on their first rent-to-own deal. Currently, they are in the process of getting pre-approved with a mortgage broker. Quentin comments that the strategy that they're using is great for cash flow, but he likes rent-to-own as an exit strategy, and not a long term option, adding “what I found was that every time that I bought properties, like the value of the property was always much higher than when I was selling it to the tenant buyer on and I had a locked in purchase price.” He adds that while this strategy is going to produce a higher cash flow, the member has to understand the tax consequences of what he is doing as well. He says “if your goal is to leave the corporate world, you're going to need to generate cash flow. So rent-to-owns are good for cash flow generation, [but] you would need to focus on getting multiple” Quentin adds that he also needs to add other properties in there, such as long-term rentals. Talking about the effectiveness of the BRRR method, Quentin says that it really supercharges the value of the property, and then you can refinance that out in 18 months to 24 months. He adds that when it comes to the BRRR strategy, the key is always purchasing a property where you can add value. It does require some expertise and work. So, you need to build a team of people around you to help like a good realtor, mortgage broker, and contractor on your team.  As for the areas, Quentin suggests looking in places like Bowmanville, Peterborough, or even Kingston, where the numbers still work, and they make more sense for the strategy. He adds that the member would have to find something that that needs a lot of work. Furthermore, he says that the member needs to maximize the amount of funds that he is able to access, and pull that together. He further adds “once you start the process and you get a couple properties under your belt, then you can actually talk to other people about what you're doing, and perhaps they can invest with you together and do, like a project together.” On the subject of going with the inexpensive lending option, Quentin adds that it's not about price, it's about access to credit, and dollar bills and credit are the same thing in the current economy. If you have credit, you have dollar bills. He suggests not focusing on how much it costs, fees, and all of that and create relationships with the other banks to check if he can open some lines of credit with them, just so that he could have access to it, and have more flexibility. Quentin recommends attending the Q&A sessions, as well as going through the Property Management, Joint Venture Partners, and Finding Off Market Properties courses. In conclusion, he says “Use that Action Taker Program, look at the takeout, The Planning Guide, look at the weekly plan, and just put one thing for finding properties. One thing for funding properties, one thing for financing properties in the Planning Guide, and one thing a week.” Topics Discussed Introduction [00:00] His Background and Experience in Real Estate Investing? [00:59] Have They Owned Residential Rental Properties Before? [02:25] The Areas He Wants to Invest in Using the BRRR Strategy? [08:03] What Can the Member do to Learn More About Real Estate Investing? [14:59] Resources Mentioned https://educationrei.ca/ldcourses/action-taker-goal-attainment/ (Action Taker Program Goal Attainment Program) https://educationrei.ca/ldcourses/property-management-key-policies-and-procedures-for-durham-rei-members/ (Property...
20 mins
13 - Investing in Multifamily Properties for Experienced Real Estate Investors
Episode Summary In this episode, Quentin talks with a member, who is looking to pull equity out of his properties to reinvest, we explore how investing in larger multifamily properties might be the best strategy for achieving his goal of building wealth. The member shares that he currently owns five properties in Oshawa, three singles, and two duplexes. His future goals are to set up lines of credits on all of his properties to give him access to around $1.5 million in equity. He says that as it hard to find cash flow in Oshawa now, he is looking at smaller, less competitive markets. He adds that he is looking for guidance and coaching mentorship, or someone to point him in the direction about whether he would be better off continuing to buy bungalows and legalized basement apartments or if he should try to get into multifamily. Quentin suggests that as his goal is to create additional net worth, the member should go for multifamily properties, as the numbers work well, especially if you purchase it correctly.  The one-to-four-unit properties are more towards generating cash flow and appreciation, but if you're looking for wealth, apartment buildings will do it for you. He adds that “you can invest yourself; you can invest with somebody else, you can do what you know, different approaches.” Furthermore, the best thing about them is that you can refinance them. They also don’t have the same roadblocks as one-to-four-unit properties.  He further recommends going through the presentations by Pierre-Paul Turgeon on the subject. Quentin adds that the member would need to find a realtor that actually does multifamily buildings. They require 30% down or 35% down depending on the purchase prices, and working in the six-to-12-unit range, it's pretty competitive. He can start by approaching people who have six to 12 units and see if they're interested in selling those. He can connect with realtors and find out whether they have anything available. He needs to look at who is listing properties in the area, and then contact them.  Quentin adds that he needs to make sure that he is getting a yield on his money, like if his interest rate is 2% and the cap rate is 4%, at least he has a spread there. Talking about the competitiveness in the six-to-12-unit properties, Quentin says that “you have to have your cash ready; you have to have your ability to close and you have to understand all the pieces. So, getting your team together is going to be really important.” Additionally, he would have to get commercial mortgage, a holding company, insurance, all ready to go. That way, when he puts an offer in, he has the cash, he has the financing, he knows how they'll evaluate the deal, and he can move ahead with it. Furthermore, Quentin suggests looking at an exercise called The Return of Equity Calculation, adding “it's a good way of evaluating a property's seeing and comparing your different assets based on your returns, it may give you a different insight. And then you could run the same calculation based on what you would buy an apartment building for and see what your return would be.” He suggests that selling an asset and putting those funds into other assets that are easily re-financeable is a better option often and staying residential, as long as you're willing to grow. He also recommends checking the discount on setting up a holding company in the discount section on the website as well as going through the roadmaps on The Multifamily Phase.  He adds that for the most part, most holding companies are the same, as there's not much different to them. But if you have high income, you may want to talk to your accountant just to make sure how they suggest you set it up. While having a paralegal set it up is a more economic option, if you haven't done it before, it is better to work with the professionals.  In response to whether the member should disregard the idea of triplexes, Quentin says that if the numbers...
21 mins
14 - Going Positive Cash Flow from Negative Cash Flow with Multifamily Properties
Episode Summary In this episode, Quentin talks with a member who has been investing close to home in single family properties. We explore different ways to convert his portfolio to multifamily properties with a positive cash flow. The member shares that he started real estate investing in 2016, when he got occupancy of a pre-construction condo that he had bought in 2011. Unfortunately for him, his property is cashflow negative. The reason was mainly because he acquired the property with 10% down, so he had to go with the unconventional mortgage and get CMHC insurance which was only 25 years amortization. Now, they have 20 years left of the of the amortization. He adds that he has a full-time job as a construction project manager, and he had obtained his real estate license in 2017 mainly because that property was cashflow negative and he needed to supplement his income and that worked out fine. Two years later and after the mortgage rate changed, the negative cash flow went from $200 to $800. He adds that he made the mistake of going with the fixed interest rate. In the meantime, he sold a condo in downtown Toronto, took the money and purchase a detached home in Etobicoke. Right before the pandemic he was thinking about refinancing his home, and managed to get a high appraisal. $250,000 in line of credit, he ended up purchasing a condo townhouse in Mississauga, and it came with a tenant who was paying market rent. After that, his net on his investment properties became positive by $50. Quinton notes that what he has essentially done is that he has created an income stream from his second mortgage, with his mortgage money in order to cover off the negative cash flow on the two assets.  The member adds that before joining the course, he wanted to stay in the bigger cities and his decision to invest in the property in Mississauga was short term. He was looking to flip it, take the money and purchase a detached home. Quinton notes that his yield is negative on the York Region property and his yield is negative on the condo townhouse by itself, but together by using the lending, he is able to come up positive on both of them. Talking about his next course of action, Quentin suggests that he should take a look at his property and do a return on equity calculation on both properties. Then, do the same thing on another property that is like a duplex that are cashflow positive while putting 20% down. So that could be looking in a little bit out further than the markets that he has been considering. He adds that the member needs to do his own due diligence to see what makes sense for him. He also suggests looking at historical data and talking to the realtors in the area, adding “you can find appreciation and cash flow in lots of different markets, you just have to work harder, right, and you have to get out of your comfort zone from where you're, you're comfortable right now.” Quinton also says that most of the time a single-family home is not going to cash flow anymore in Ontario, it's very challenging. He should not get stuck by being a Toronto person, because there there's money to be made everywhere, further adding “you want to get the most yield that you can, so you can get a return on equity.” On the subject of the member looking to use the Section 85 Rollover, Quentin says that “you won't be able to do that unless you find a lender that's willing to put the corporation on title, what you might consider doing is figuring out whether you can do it the day before you, like sell the property, like, but then you'll have to come up with cash or some other private loan in order to close on it maybe like a bridge loan for a day or two.” additionally he will have to pay land transfer tax, legal and accounting costs. So it adds up in Toronto, because you got the Ontario tax, and you get the Toronto land transfer tax. The member concludes that he may choose the option of instead of putting up the condo or townhouse for sake,...
27 mins
15 - Investing in Triplexes, Fourplexes for Better Cash Flow
Episode Summary In this episode, Quentin talks with a member, who started with house hacking his first property and he was looking to expand his portfolio. With the current housing market, we explore possibly going with a triplex or a fourplex instead of a single-family home or duplex. As a fairly new immigrant to Canada, the member bought their principal home in December 2019. They moved to Oshawa in February 2020. They started with house hacking and rented their basement out. Now, they are looking for a rental property wherein they could start their journey. As for the financing for their next property, he plans on using some savings and a gift as down payment. He also has a few lines of credits as well. He adds that working with the bank that he has mortgage with, he wanted to get advantage of appreciation on his current house, remove the CMHC and be able to buy another one at 5%. Quentin adds that it is possible that he could use one of those other avenues in order to get a lower down payment, but there are typically for principal residences, and a grey area. The member shares that while he is interested in Oshawa, it's either he could wait for some time and save more, or with whatever he has, he goes to a market where he can afford something and at least break, even if not positive cash flow. He adds that he has the affordability, and down payment is his only problem. Quentin adds that he may end up with negative cash flow unless he has a really strong cash flowing property.  Quentin suggests that he may want to look at Peterborough market, and something that is a little bit out of his comfort zone but may give more cash flow. That could be a different type of property like a student rental or maybe a triplex or fourplex. He could still get that type of financing that he is interested in, because it's still under the residential umbrella. It gives him the ability to have more units, so the one to four units still, even if divided as a duplex, he’d still have that that same kind of qualification room. He recommends checking out courses on Property Management, and Your First Three Properties in Real Estate to get a better idea of the fundamentals.  He further says that while Peterborough is a good option, as he goes further away, he will have to build property management costs into that as well. He also recommends getting on some wholesaler lists as well, just to see what's coming up on them, and to get a different sense of what's coming in and going out. Quentin says that if he can use the lower down payment in order to get into a property, he should take advantage of it. It is a good way to add some leverage, just make sure that the numbers all work out, and that he is still able to financially maintain that.  He adds that those rental properties are going to be assets that give wealth and income. The principal residence will give wealth because it will increase in value, and it can be leveraged differently. He recommends working with a mortgage broker that looks at more than just the next transaction, but helps plan out the next four or five transactions. In conclusion, he says that ultimately, the investment depends on his life situation. He adds that your personal residence is an emotional decision. It's not often an investment decision.  Topics Discussed Introduction [00:00] Does He Have Funds for a Rental Property, and Has He Talked to Anyone About Financing? [02:26]  Has He Decided on an Area That He is Going to be Investing in? [04:47] What Type of Property is He Looking to Invest In? [06:03] How Does He Feel About a Triplex or a Fourplex? [09:10] Resources Mentioned https://educationrei.ca/ldcourses/property-management-key-policies-and-procedures-for-durham-rei-members/ (Property Management Course – Vault) https://educationrei.ca/ldcourses/your-first-three-properties/ (Your First Three Properties in Real Estate – Vault) Important Links https://educationrei.ca...
17 mins
16 - Real Estate Investing Tips from Lewis Brothers
Episode Summary In this episode, Quentin talks with Don Lewis and Rick Lewis, two brothers who started in the renovation field and made their way into real estate investing. They take us through some of their investing experience, and share some of their wins, losses, and some useful tips for new investors. The Lewis Brothers have been in the real estate business for four years. They have a construction background, with15 years of experience in custom renovations. They fumbled into real estate investing by buying their first house privately and realized that buying and flipping houses was a lot easier. While they buy houses in different areas, they are primarily based in the Durham region. Talking about marketing, they say that their marketing is always growing. They started with flyers and bandit signs. As for the philosophy behind their marketing, they say that usually they are looking for somebody who is in a situation where it's a little different than getting your house ready to sell on the market. Such as when there's a financial issue, distressed property, or something that just won't close with the bank. At the same time, they also tried to figure out how they can help the owners in the process as well, going as far as putting money up front to help them.  Doing so has helped them develop relationships with the sellers, adding “a lot of it really is just the relationship you've built with the seller in order to know what, how you can help them, and we've got a lot of people come back and give us very good reviews.” They want to build long term relationships and figure out how they can help sellers get out of scenario that they're in at that time. Talking about what has helped them succeed in finding off market deals, there that a lot of it has to do with the marketing, and just being in front of people with their flyers and bandit signs.  Quentin notes that being quick, being able to close with cash if needed, not caring about the condition of the property because of their construction background, has helped them succeed in finding such great deals. Talking about a property that got away, the Lewis brothers share that they noticed a lot of red flags from the financial perspective and the additional costs added at the end, so they decided to not go ahead with the deal. They add that “we have set up ourselves, our financing because we guarantee a close on every deal no matter what, whether we wholesale it, JV, if our partner, whoever purchased from us can't do it, we close on it, no matter what. So, we're set up to be able to close… within 24 hours if we need to.” Talking about the mindset you need to succeed in this business, they add that you have to rifle through a lot in order to actually get that one deal. It's probably 20 to 25 phone calls or leads, before you get down to three people that are interested in talking to you, and then of those three, you might get two offers out and then one accepted. So you have to build a tough skin and not get too emotionally involved in each project. As for their advice for new investors who are looking to get started in finding off market properties, they add that you should know your market and don't go too broad. Specify what you're looking for and where you're looking for it, because the second you get that call, the jump on it, as the action has to be fast. Study and learn your market as much as you can and specialize in a certain area when you start, instead going too broad. You should also have a good realtor too, one that understands the market, and that is up to date with, then work with other investors as well.  In conclusion, they say that you have to let sellers know they have options, there's not only one option that they have to sell with a realtor. Let them discover what options they have in order to sell their home. A lot of times the houses that you are offering off market, are going to come back on market and you're going to get the...
20 mins
17 - Real Estate Lessons from Former Teacher with Paul Punnoose
Episode Summary In this episode, Quentin talks with Paul Punnoose, a former teacher takes us through some lessons that he learned along his journey into wholesaling to share some of his offline and online marketing strategies for finding off market deals. Paul worked as a teacher 13 years, and he has been a full-time real estate investor for the past year. He has done a variety of strategies, from buy and holds, flipping, to now wholesaling. Talking about his strategies to get off market deals, Paul uses online marketing such as Google Pay Per Click ads, Facebook advertisements, and Kijiji ads. He says that each strategy has produced different types of results, and has different pros and cons.  Furthermore, the cost for online lead generation is much higher than his cost per lead offline. Paul uses the inbound marketing, where people will call him, as he wants people to contact him versus him contacting people. He adds that “I know that when I pick up the phone, that person is interested in selling their property.” Talking about his lead versus offers versus actual sales statistics, he says that sometimes those numbers are difficult to track, but he keeps an eye on the key performance indicators. Paul adds that generally people like to hear cost per lead cost per deal metrics. He focuses more on his overall cost per deal.  Paul says that he thinks about what his cost per deal is, and then work backwards. It also varies from quarter to quarter, ranging between $3000 to $6000. Quentin adds that people get surprised by the cost of marketing that goes into finding a deal. Talking about his unique ability, Paul describes it as the ability to connect with people, and he prefers partnering up with people that are really good at marketing and advertising. He further adds “my ability is to connect with the seller and figure out, you know, what they're looking for, and why they're looking for it, and help them solve whatever issue they're going through.” Listening, hearing what the sellers want, offering solutions to their problems, but also connecting with them has helped Paul secure off-market deals. Quentin adds that it's not always about getting the highest price. Sometimes, there are other things that people value. Paul says that when people have a lot of equity in their property, they don't mind giving some of that up for a convenience. Talking about the deals that got away, he says that newer investors should keep in mind that out of the deals that they put out, only 10 percent will find success. If you go in with that mentality, while it will still hurt, they will be able to handle the whole process a little bit better.  He says that in such cases, the best thing to do is to learn from what happened, so you can make adjustments for the next deal. In this industry, you need to really listen to the seller, listen to their problems, provide solutions, but allow the seller to really think about which solution is important to them and take it from there. In conclusion, Quentin says that sometimes, even when you get to the point where you have a signed offer, doesn't necessarily mean until the deal has closed. Paul says that the deal is not closed until the profits hit your bank account. Topics Discussed Introduction [00:00] What Strategies Does He Use to Find Off Market Properties? [02:06] Why Does He Prefer Online Marketing Despite the Higher Costs? [03:48] Does He Track The ‘Lead Versus Offers Versus Actual Sales’ Statistics? [05:33] His Unique Ability to Find Off Market Deals [08:00] How His Ability to Connect with People Helped Him Secure a Deal [09:21] The Deals That Got Away and What He Could Have Done Differently [12:38] Deals that Didn't Close Even After Signing Contracts [16:36] How to Get in Touch with Paul Punnoose? [20:06] Resources Mentioned https://www.profitableproperty.ca/ (profitableproperty.ca)  IG: Paul.punnoose Important Links https://educationrei.ca...
21 mins
18 - Real Estate Wholesaling and Flipping Secrets with Aaron Moore
Episode Summary In this episode, Quentin talks with Aaron Moore, a multi award winning real estate investor who is best known for having one of the most established house-buying companies in Canada. Aaron takes us through what makes his real estate business successful. Aaron Moore runs a company that is best known for house buying and wholesaling since 2008. He has flipped a lot of houses himself and built up a portfolio of rental properties over the year. Quentin adds that in the real estate space, people come and go all the time, there are people that they go to a workshop or the go to weekend boot camp, they come back they post signs, and then they disappear. Talking about what contributed to his longevity in the business, Aaron says that it boils down to work ethic and daily habits. He is a good longevity person, and when he makes goals, he sticks to them and achieves them.  On the subject of finding off market properties, Aaron says that he started offline, but since then, their methods have evolved. Being long term in this business, they've built a web presence, and now, online dominates their marketing. He adds that it acts like a credibility piece as well, and helps people find reviews from past sellers. There is always a trust component, as 95% of people are going to sell with a realtor or MLS. As a house buyer, people are going to be a little more skeptical, and we want to overcome that skepticism. He adds that a unique thing for their company is that they have a strong seller focus, and they take care of their sellers, and treat them well. This sets you apart from everybody else. That is why they offer the biggest deposits and have the shortest conditions, because they are seller focused. Talking about the properties that they usually buy, he says that 80% of them are fixer uppers, with occasional beautiful houses. As investors, they can add value in different venues to the fixer uppers with their skills and renovations.  As for how to have a property assigned to you, Aaron says that you got to have that funding in place, and be confident like you got to put down a big deposit. He adds that when they buy, they put down a significant deposit. So, when they sell or wholesale a property, they are looking for a significant deposit that shows buyer’s seriousness and that they're not going to back out, and don't want to be closing late, as that can be a big deal. Talking about their ‘leads versus offers versus actual purchase’ statistics, Aaron shares that it's somewhere between 10 to 15, with slight ups and downs in numbers during different quarters.  Quentin adds that sometimes, just because you have a deal under contract doesn't mean that you're going to close on the deal. Aaron says that the reason behind this can be a case of buyer's remorse, where they change their mind offer signing the contract. Sometimes, there are also some deposit issues. They have made changes to their paperwork about deposits to deal with such issues. He says that you want to make sure everyone's happy. You don't want to be buying from someone who just does not want to sell to you and wants to make it difficult.  On the subject of the marketing costs, Quentin adds that new people to the space often mistake the amount of advertising and the amount of money that goes into this, because they only see the fee. They don't realize that the amount of other work that gets them to the point to have this opportunity. Aaron shares that advertising plays a crucial role in this business, and they have dedicated team for this job, with a six-figure budget to run the marketing campaigns.  Topics Discussed Introduction [00:00] What Does He Attribute His Longevity in the Real Estate Business to? [02:47] How Has He Been Able to Find Off Market Deals? [03:48] Online Presence to Establish Trust as Homebuyers [04:55] What Sets Them Apart from Everyone Else? [05:44] Who are They Competing Against? [06:40] What Type of...
21 mins
19 - Securing Your Retirement with Real Estate Investing
Episode Summary In this episode, Quentin talks with a member who is new to investing and wants to use it as a vehicle to set up her family's financial future and her retirement. They explore some options she can take during her growth phase of investing.  Talking about their background, the member shares that they are originally from Durham. They had been living in Toronto, in a single detached house. They decided to rent it, but the cash flow was not ideal compared to what they can get out here, for a lot less mortgage. In June, they bought duplex in Bowmanville, and rented the top floor, while they worked on the basement to rent it out as well. The renting arrangement for the upper floor came around to $1500 due to a family arrangement, and the basement for $1775 plus utilities. Quentin adds that working with family is fine, as long as they have a proper lease in place, as sometimes there can be a little tension, especially in such cases. The member adds that both of the leases are short-term. Quentin says that as they are helping a family member out, they're doing them a favor, and hopefully that'll come back to them. On the subject of why they want to invest in real estate, they member shares that while both she and her husband do well financially, and have pension, they want to do this for their three kids. They want to do something like they didn't get help themselves, but to help them, like with a down payment, and then it would be nice if they had another one to help themselves.  She also shares that they do not have access to equity that they could repurpose into another property, and with the closing cost, the property cost them around $715k. Quentin adds that if they make it a legal duplex, then there should be value that's added to it, because if it's illegal duplex, they will be able to include both rents when you're applying for a mortgage. He mentions the related content on the subject in the vault, called The Phases of Real Estate Investing, Property Management, Key Policies and Procedures in the start area, as well as the course Your First Three Properties.  Quentin adds that they can rely on other property management services in the area to help them out, and some of them will just do tenant placement for them. In addition to this, the five-hour course on Property Management is helpful in this regard as well. The Getting Higher Appraisals course can help them get better appraisals for their property, and set themself apart from everybody else, as most people will never do this. He adds that there are a lot of times when we get paid in this business, we get paid in cash flow, and when we sell a property, but we try not to do that very often. What's better than selling a property is the appraisal; that's when we get paid.  Talking about another way to mixing the funds from one that's deductible to nondeductible, is The Smith Maneuver. It's a strategy that allows you to turn your nondeductible debt, which is the interest on your mortgage to make it tax deductible. He suggests that if they take from the refi, put it on their principal, and then access it again, they're basically converting their nondeductible debt to deductible debt. Then the next year, if they did it, bought a property and the same process, they're basically converting their principal residence into deductible debt. Once they've done the whole process, and it's all line of credit, then they go back and get a new mortgage, it's clean, because all of it has been deducted. Then the interest would be all tax deductible; the principal wouldn't, but the interest would.  In conclusion, Quentin suggests attending the Q&A calls, as they're great for networking to meet other people in the area who are investing. The other thing is to make sure to take advantage of the video materials. There's a lot of resources that are on there. If they want to do something specific, they can go through the roadmaps, as they are...
25 mins