Investing in Real Estate
"Investing in real estate has become very popular in Sudbury and The Greater Sudbury Area" says Bruno Gobeil, Broker of Record at Royal LePage North Heritage Realty, Brokerage. With over 1,700 rental properties sold last quarter, it is evident many people are turning to investment properties as a source of income. Investing in real estate is a great option for the investor who is looking to have control over their investment. Typically these are long term investments and can help expand your portfolio.
There are several ways one can invest in real estate, whether it be home ownership, multifamily rental properties or commercial properties. Although home ownership is not a true investment as it does not generate cash flow, it still provides the opportunity to sell at a later date for profit gain. Purchasing a multifamily rental property can mean anything from owning a two unit property (a duplex) to an apartment building with 12 or more units. Finally, owning a commercial property allows you to lease out the unit(s) to a variety of businesses.
So how do you get started?
Step 1: Determine your goal
It is crucial to determine your goal before making any investment decision. Be honest with yourself! Are you looking for ongoing cash flow to assist with the costs of daily living or to help build retirement income? Or, is it your objective to make a quick return on investment?
Step 2: Plan a strategy
Second, plan a strategy for your real estate investment. Are you looking to purchase a "fixer-upper" to purchase and flip? Perhaps you are looking to purchase and hold (long-term). Many investors choose to do a combination of both, fixing and holding long-term.
Step 3: Figure out your financing
Talk to a mortgage broker to figure out just how much money you can invest. Talking to a mortgage broker first helps you avoid the confusion of not knowing what your budget should be.
Step 4: Talk to an investment real estate expert
Talk to a real estate sales representative that has expertise in investment properties. They can help you explore various properties currently on and even off the market, finding you the property that best suits your goals. An investment real estate expert will be able to explain in detail what investments are best for you through various factor such as Cash Flow, CAP Rate, NOI and ROI.
Step 5: Invest
Invest! Choose which investment property or properties that best suit your needs and write an offer. If applicable, have your real estate investment expert offer you options for property management.