Welcome to another episode of the Truth About Real Estate Investing for Canadians where we’ve been bringing you some of the best tips and past experiences from successful investors since 2016!
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As I’m recording, the bank of Canada just announced an increase of 0.5% so the overnight rate is now 1%. This is the first 0.5% increase since May of 2000.
The bank said it would begin shrinking its holding of government bonds, aka quantitative tightening which will reduce the amount of money supply.
To me, this is a good thing as the pendulum swung so far toward money supply increases during the last two years of the pandemic and inflation needs to be controlled.
These are historic times with a pandemic mostly behind us and war in Ukraine still ongoing.
As long as the war keeps going, inflation will remain high thanks to oil and gas prices; food and fertilizer on top of the manufacturing/supply chain disruption.
As inflation remains high, so will interest rates increase, but my prediction is that interest rates will fall again after the war and supply chains are restored. As for when that is is anyone’s guess.
Dr. Sherry Cooper is saying the market predicts the current overnight rate of 1% to rise to almost 3% a year from now and the Governing Council of the Bank of Canada expects inflation to ease from there dropping to 2.5% in the second half of next year than a normal 2% in 2024.
A big caveat again is the BoC misjudged inflation due to the war in Ukraine and again, it’s a big unknown when the war will end.
I personally expect inflation to remain higher than pre-pandemic levels as governments all over the world realize they are too dependent on other countries for critical goods and look to mine, dig, drill, or manufacture more locally which will cost more. China didn’t become a manufacturing superpower because they cost more.
On top of that, governments continue to increase spending as we’ve seen here in Canada with our new budget including new spending for daycare, dental, and pharmaceuticals.
That and I received a cheque for $120 for my licence plate sticker. I don’t know why I got a refund when I haven’t renewed my sticker in over two years… but yay, free money. Maybe I’ll buy some TD shares with it. TD pays a 3.8% dividend and the stock’s been beaten up the last few weeks. As a full-time capitalist, I do enjoy making money but with a social conscience.
What’s the new interest rate mean for real estate? On the streets, we are seeing showings slow down. We even had a listing in Brantford, a starter home, asking price right at market value of $700,000 received zero showings over the weekend.
As I predicted, buyers rushed out to get ahead of the expected interest rate hikes this spring… the funny thing is if they bought today, they could save 5-7% as that’s what we’re seeing so far in terms of prices.
Note that days on market in our areas are still single digits. Around 8 days in March vs when I got licensed in 2010 we were 5X higher around 40-50 days on market.
What are Cherry and I doing? As previously mentioned, we prepared for this moment by ordering several properties for refinancing so we could raise capital. Appraisals were done at the peak of the market two months ago, paperwork is in progress and we’ll wait for opportunities that my team brings me… timing the market is hard and I guess we got lucky this time but having one’s finger on the pulse and read a lot helps.
It’s a substantial amount of capital we will be freeing up and we’ll be adding to our stock hacking accounts too as several companies we like have been beaten up lately to keep our money working for us and generating cash flow via dividends and selling options. A much preferable option for Cherry and me as we want more cash flow in our lives and prefer to be in control of our money.
What about private lending Erwin? I’ve seen too many lose their capital via private lending. The risk/reward is just not there for me knowing where the risks are and where the market is at. I’ve been around organized real estate investing since 2008 and seen money lost in a multitude of ways hence I’m on the conservative side.
Hopefully, for my regular 17 listeners, you’ve been following along closely, taking action on what’s been shared here and at our meetups to set yourself up for optimized success.
Speaking of meetups, our next in-person, no to Zoom, live meeting is Saturday, April 23rd, doors at 8:30 am. We’ll be sharing about joint venturing, the latest happenings on the streets, and renovating for returns. If you’re on my email list, you’ll receive invites to register. If not, go to https://www.truthaboutrealestateinvesting.ca/, input your name and email address and you’ll start receiving email notifications of our events.
Is it doom and gloom for the real estate investor? If you think it is, I highly suggest getting educated and spending more time with veteran action takers who’ve actually invested through a real recession before. That last real one was 2007-8 and I’ve made plenty of money during that time.
Interests Up 0.5% & Investing In Belleville With Stephen “HGTV” Phillips
Enough from me, on to this week’s guest, we have a real estate investor from Belleville, Ontario located between the east side of the GTA and Ottawa. With affordability being terrible in the GTA and Ottawa, homeowners, tenants and investors are driving further than ever as shown by the Uhaul report listing Belleville, ON as the #2 end destination for their moving truck rentals. Also, I’ve spoken to several Oshawa investors who have expanded their search to Belleville. Investors I respect.
Then what do you know Stephen Phillips reaches out to me to say hi and here we are!
Stephen or his business, who’s been featured on HGTV 24 times with Scott McGillivray. More importantly, Stephens’ real estate experience includes managing 1,200 apartment units in his previous career, then going on vacation to Costa Rica and moving there, now he’s back in Ontario for family, jumping into real estate with both feet in 2014, joining networks, hiring coaches like Ian Szabo and Quentin D’Souza.
Near the end of the interview, we get into detail on what current opportunities look like in Belleville and Stephen’s awkward, celebrity fan moment when Scott McGillivray.
Please enjoy the show!
This episode is brought to you by me! We don’t have sponsors for this show, I only share with you services owned by my wife Cherry and I. Real estate investing is a staple in my life and allowed me to build wealth and more importantly, achieve financial peace about the future knowing our retirement is taken care of and my kids will be able to afford a home when they grow up. If you too are interested in my systematic strategy to implement the #1 investment strategy, the same one pretty much all my guests are doing themselves, then go visit www.infinitywealth.ca/events and register for our next FREE Online Training Class. We will be back in person once legally allowed to do so but for now we are 100% virtual.
No need for you to reinvent the wheel, we have our system down pat. Again that’s www.infinitywealth.ca/events and register for the FREE Online Training Class.
This episode is also brought to you www.stockhackeracademy.ca where everyday real estate investors learn the best practices in stock investing to earn cash flow in about 15-30 mins per day from their mobile phones. After real estate, Stock Hacking is the next best hustle as you’ve heard from many past guests on this show. Among our students last year, 31 trades were shared with them. 30 were profitable for an over 96% success rate. I will be giving free demonstrations online, very similar to the one I gave my kid cousin, a full time musician and he just made 50% return in 2021. Past of course does not predict the future but if you’d like a free demonstration go to www.stockhackeracademy.ca in the top right, click FREE Demo. At the demonstration I’ll have special bonuses. We do not advertise publicly for all my favourite listeners and I only have two more demos to give in the next few weeks.
Don’t delay www.stockhackeracademy.ca, what I consider the future of side hustles with real estate so unaffordable for many.
Just a friendly reminder that we are hiring more investment Realtors who want a full-time challenge to help our clients, regular everyday people, mostly from the GTA, invest in the top investment towns west of the GTA.
This is for driven folks who want to multiply their current incomes.
APPLY HERE: https://www.infinitywealth.ca/hiring
To Follow Stephen:
HELP US OUT!
BEFORE YOU GO…
If you’re interested in being a successful real estate investor like those who have been featured on this podcast and our hundreds of successful clients please let us know.
It is our honour to give back and educate others on how we build cash flowing real estate portfolios using all the best practices shared on this podcast, from the lessons of our hundreds of clients and of course our own experience in owning investment real estate.
If you didn’t know already, we pride ourselves on being the best of the best real estate coaches, having the best property managers, contractors, handy people, cleaners, lawyers, accountants, everyone you need on your power team and we’re happy to share them with our clients to ensure your success.
New investor or seasoned veteran investor, we can help anyone by providing our award winning coaching services and this isn’t all talk.
We have been awarded Realtor of the Year to Investors in 2015 by the Real Estate Investment Network, 2016 by the Canadian Real Estate Wealth Magazine and again in 2017 because no one told the judges no one is supposed to win the award twice but on merit, our peers deemed us as the best. In 2018, we again won the same award by the Real Estate Investment Network.
Hopefully being the most decorated team of Realtors in Ontario will make you consider us for your first or next real estate investment. Even if you don’t invest in our areas, there’s a good chance I know who would be ideal for you.
I’ve been around for a while, some Realtors are talented at servicing investors there are many with great ethics. The intersection of the two, talent and ethics is limited to a handful in each city or town.
Only work with the best is what my father always taught me. If you’re interested, drop us an email at firstname.lastname@example.org.
I hope to meet you at one of our meetups soon.
Again that’s email@example.com
Infinity Wealth Investment Network – would you like to know how our investors returned 341.8% on positive cash flowing real estate over the last five years? On average, that was 68.4% per year.
Just imagine what winning in real estate could do for you.
If you would like to know how we did it, ask us how by calling 289-288-5019 or email us at firstname.lastname@example.org.
Don’t delay, the top markets we focus in are trending upward in price, so you can pay today’s price or tomorrow’s price.
Till next time, just do it because I believe in you.
Hamilton, St. Catharines and Toronto Land Development, Real Estate Investor, and soon to be builder.