The market is a wild one, with interest rates really high.
While many speculators out there are getting crushed, we checked our numbers: our clients who sold their investment properties in the last six months, after an average hold of 5.2 years, received an average of $313,000 price appreciation alone because they bought, renovated, rented the right way.
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The real estate market means many things to many people. Folks with houses on land in bigger markets are just fine. Prices are resilient and are near 2021’s peak, while pre-construction and cottages are in a buyers’ market.
Both will likely be fine in the mid to long term, but for now, especially if one is vacant, it’s going to be painful.
I was speaking to one Airbnb property manager in the Niagara Region who shared with me that more supply has come on the market via new construction owners as they can’t cash flow with long-term tenants on a single-family home who have turned to short-term and mid-term rentals.
So short-term rentals for existing investors are not performing as well as they used to.
A friend of mine who’s been operating Airbnbs for several years and was able to quit his job from the income 4-5 years ago shared with me his Airbnbs are not performing as well as they did pre-pandemic.
As for long-term rentals, our clients are doing just fine.
They may be vacant a month or two while testing out record-high rent asking prices in markets like Kingston and Hamilton. E.g. Coach Steve Phillips in Kingston shared with me that our client signed for $2,600 for a 3 bedroom, main floor apartment in Kingston, and we have a client asking for $2,500 for a former garage they have since converted into a two-bedroom apartment in Hamilton.
On the other hand, small market and novice landlords appear to be struggling based on my conversations with investors reaching out for portfolio reviews or help.
Small towns far from the GTA, which were the darlings of real estate in the early pandemic, are now correcting.
Is this the new normal?
Long-term, everything will hopefully be fine if they can find tenants. In the short term, we’re seeing great turnkey deals and deals in bigger markets.
Why is that important? Bigger cities and turnkey mean lower risk.
One mistake I find new investors make… well, maybe two is they believe what they see on HGTV and think money in real estate is fast and easy, which could not be further from the truth.
The other is more work and effort means more returns.
For example, I mentioned earlier some of our clients are taking profits and paying down debts while rates are high. The best performing property was bought turnkey from a builder.
I sat with the builder to design the house to be the perfect student rental, and it was. That house, and other similar houses, required no renovations and currently get the highest rents in the market.
After a 7-year hold, our client walked away with $489,000 in price appreciation alone. That’s nearly half a million dollars in profit from one stream of income.
My point is turnkey; small multifamily can be a viable option, so don’t discount it thinking one must buy an ugly property that requires months to years of renovations plus hundreds of thousands of dollars.
As a sophisticated investor, one should look at the variety of options available and make decisions holistically.
I’ve had several calls with novice investors considering options four hours drive from home, each way. Or out of province. VS. I always tell clients it’s not that hard to make money closer to home.
If you can’t make money closer to home, what makes folks think they can succeed in a market where they have no contacts or relationships?
It’s obviously possible as past guests of this show, but not everyone is willing to put in that full-time effort. Nor do they have a partner/spouse earning six figures at home to pay the bills and put food on the table.
In my experience of having worked with over 350 successful real estate investors, investing within an hour’s drive is world-class, profitable and can be done as a side hustle so folks can go back to living their lives.
They didn’t do so by investing in pre-construction condos, no flipping, nor higher risk strategies that required private borrowing.
Trendy, fad investing can work. It just seems to take more savvy, deep pockets, risk and effort. When keeping it simple, tried and proven works just fine.
The sad thing is that with housing prices so high, it will only be the rich who can afford deals in the current market and going forward.
Even more sad is this situation will only worsen when the rate cuts begin sometime mid-next year as buyers get off the fence and push this sellers market further into sellers market.
TRREB released their July stats already, and of note, property days on the market is 24, prices held steady from June even with more listings hitting the market, and average prices are above last year’s.
In Hamilton, we’re up 5.5% year over year. That’s a wonderful amount of appreciation because even if you bought a cash-flow-neutral property last year and put down 25%, that’s a 22% return!
With interest rates expected to come down sometime mid to late 2024, we should see prices climb, and we’ll be sharing how our clients continue to earn world-class returns via online monthly iWIN Meetings and MasterMind Tours, so don’t miss out!
The best place to stay informed is our email newsletter, where we let folks know when new episodes are available and the scheduling of our events.
Many of my wealthy friends are taking advantage of the opportunities presented by this market; find out how you can too.
Sign up for our email newsletter at www.truthaboutrealestateinvesting.ca; enter your name and email address on the right side, and you’re set to become a well informed, sophisticated investor!
Speaking of simple, tried and proven, Cherry, the kids, and I just returned from a week-long vacation in Muskoka. We didn’t stay in a luxurious cottage; we stayed at a family camp at the YMCA on a huge property with lots of greenery, a lakefront, and most importantly, camp councillors and kids programming.
Each day the kids would do all sorts of activities: tree top trekking, wall climbing, canoeing, kayaking, swimming, sailing, nature hikes, arts and crafts, and archery.
As a family, we could participate in those same activities in the afternoons. We did them all. Meals were provided.
Our accommodation was a cabin with ten bunk beds, so very simple accommodations; the same cabin regular overnight campers used, so it had no frills, air conditioning, or bathroom.
We had a blast! I mean, the beds could have been better for my back and sleep, but the kids had a blast.
The camp councillors were amazing; we enjoyed the meals, campfires, and being disconnected from the city.
This was our 2nd visit to the YMCA family camp, our first since the pandemic, and we plan to be back next year. A simple vacation, camping is tried and proven to be fun for kids, and it works 😊
Recreational Property Investing: Hundreds of ACRES, RV Sites, Even a Golf Course With Darvin Zurfluh
On to this week’s show!
We have my friend Darvin Zurfluh, who has a huge private equity brokerage called Pinnacle Wealth Brokers.
If you’ve been around the investor community, you’ve likely seen them around at events, but today we have the founder of the company joining us from Calgary, Alberta.
If you’re not familiar with private equities, well, you need to be as good as private equities is part of the reason you’ll hear me say it’s better than ever to be rich as the options for investing have never been so good and available.
I was introduced to Darvin when I asked my own Pinnacle Wealth Broker representative Steve Blasiak for a large-scale podcast guest in the recreational investment space since so many of my listeners are interested in AirBnb.
Having been in the investment industry since 1997, starting out at the bank, Darvin has since progressed to owning a couple hundred acres, hundreds of RV sites, cabins, campgrounds, a hotel, and a golf course.
Darvin details the story behind the purchase of the golf course, the analysis, and the value add strategy, which I find particularly fascinating.
This is a fascinating interview into entrepreneurship in the private equity real estate investing space at a large scale that is also available to middle-class investors to participate in passively.
Active or passive investors will appreciate this interview, and if you enjoy it, Darvin has been confirmed as a guest speaker at the online, November 21st, monthly iWIN Meeting.
There Darvin will go into more detail about what private equity investments are, how to start one to raise capital, and the story behind starting his recreational properties investment fund, so make sure you’re on our email newsletter like the over 10,000 plus iWinningest investors in Canada at www.truthaboutrealestateinvesting.ca.
As we discuss securitized investments, please enjoy the show and this legal disclaimer as required by the iWIN Legal Department.
If you’d like to learn more about investing with Darvin’s company Pinnacle Wealth Brokers:
Dealing Rep – Exempt Market
Pinnacle Wealth Brokers Inc.
7 Kingslea Gardens
Toronto, On M8Y2A7
Phone: 416 464 3085
Book an appointment with Steve – https://calendly.com/steven-blasiak/30min
The information and opinions expressed in this podcast are solely for educational and informational purposes and should not be considered as investment advice. The hosts and guests of this podcast are not licensed financial advisors, brokers, or registered investment advisors, and their comments should not be construed as recommendations or endorsements of any specific investment, security, or strategy.
Investing involves risks, including the possible loss of principal. Before making any investment decision, you should conduct your own research and consult with a licensed financial advisor to determine the suitability of any investment for your specific financial situation and investment goals.
The hosts and guests of this podcast make no representations or warranties as to the accuracy, completeness, or timeliness of any information discussed in this podcast. The podcast is not responsible for any errors or omissions, or for the results obtained from the use of this information.
Listeners are advised to use their own judgement and seek the advice of professionals before acting on any information provided in this podcast. The podcast shall not be liable for any damages, including but not limited to direct, indirect, special, or consequential damages arising out of or related to the use, inability to use, or reliance on any information provided in this podcast.
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 me. 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.
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 email@example.com.
I hope to meet you at one of our meetups soon.
Again that’s firstname.lastname@example.org
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 email@example.com.
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.