Sell ‘n STAY™ is a new program that helps Investors/Developers by providing them with a turn-key investment. We work with a variety of agents, brokerages, and third parties to create a seamlessly simple, private, secure investment.
Why Real Estate as an Investment?
Real Estate has long been known as the most power way to accumulate wealth. More people have utilized the power of RE Investments to become millionaires than through any other means. Although there is an obvious need to save for Retirement a recent Manulife study indicated that a startling 65% of Canadians will face financial difficulty and need their homes equity to finance their retirement.
There are many options for building wealth, but most of these options pale in comparison to investing in real estate. There are savings accounts, Stocks, bonds, Mutual Funds and money market accounts. These investments are considered safe, but mostly they barely keep pace with inflation.
Advantages of Real Estate
Appreciation
When I ask my clients how much they purchased their 3 million dollar estate for and they say I purchased it for 97,000 in 1979 we know that like anything else the value of real estate is determined by supply and demand.
Real estate fulfills a basic need ….shelter. People need a place to live, work and shop where they are protected from the weather. Additionally, real estate is an investment that actually benefits from inflation. When inflation goes up so does real estate values.
Leverage
One of the key benefits of investing in Real Estate over any other asset class such as stocks, mutual funds, commodities and government financial instruments is leverage. Leverage allows you to purchase and control a large amount of real estate with a relatively smaller amount of money.
Example.
If you purchase an Oakville Townhouse for $630,000. 20 % down = $126,000 down payment. Then acquiring a mortgage for 80% of the rest of the value.
If you bought any other investment for $126,000 like gold, stocks or mutual funds and it increased by 10% your investment is now worth $126,000 + $12,600 = $138,600 but 10% increase on that townhouse is $63,000. you have now made a return of 50% of the downpayment. Plus the tax advantages of writing off the expenses and depreciation. This doesn’t even take into consideration the equity build-up resulting from the decreasing mortgaged principal, the cash flow.
Financing
You can get financing for purchasing real estate. Lenders will loan up to 80% of the market value of your property . You might be able to get financing for stocks and bond purchases but you are limited to 50% of the principal value and if the stock drops in value you may experience a broker’s margin call which means that you are forced to pay those funds back immediately.
Tax Advantages
With Real Estate investments, you are allowed to deduct, as an expense all of the mortgage interest, property tax, insurance, maintenance , repairs, professional fees, and depreciation, etc.
Depreciation is particularly a tremendous deduction that is underappreciated. This is a paper deduction which means that you do not need to spend any of your own cash in order to get this deduction. Of course, we all know that property will be worth much more than what you paid for in 27.5 years. Nevertheless, that $630,000 house would be worth about $8,000 in depreciation deductions.
Your Tenant Pays Your Mortgage
How cool is that, that your tenant literary buys your investment property for you. He pays rent which you then use to pay down your mortgage. When you invest in stocks, bonds, or metals you are the one paying for it all.
Terra Firma
Let’s face it real estate is widely recognised as one of the greatest assets to own. It makes for solid collateral, shows strength on balance sheets and can be financed easier than most other assets. It is no surprise that foreign country choose to purchase real estate here to hold their wealth in a stable country.
Why use Sell ‘n STAY™ versus finding the deals and tenanting the properties yourself?
1. AAA+ tenant. No midnight police calls, no destruction of your property.
2.Long term contract. No Move in / Move out costs (0 – low vacancy rate)
3.Able to buy prime locations before they become available on the open market
4.Land assembly opportunities – costs are covered, no vandalism.
5.Turn-key from the first day
6.Able to match personalities – landlord and tenant.
7.Able to select from database of opportunities.
8.No need to retrofit before you rent it.
9.No HST because these are resales. Established neighbourhood.
10.Ability to see what the tenant and neighbourhood are like.
11.Ability to get us to look for opportunities in your neighbourhood of choice.
12.As professional Real Estate agents who are trained, insured, experienced and licensed we provide our members with the tools, powerful connections, and in-depth knowledge, networking with like-minded investors.
Whether you are considering investing in your first property, or you are an advanced investor preparing to purchase your next investment property; we hope you will consider a Sell ‘N Stay property one to invest in next..