Canadian Real Estate Investing 101

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Real estate investing can seem frightening and confusing if you’re just starting out, but many find this type of investment worthwhile! And it’s not just about buying as many properties as possible. Almost anyone can get into real estate investing, no matter what experience or budget you have.

Here are some options you can explore to get started in the real estate game.


Types of Real Estate Investments

Owning your residence. Buying a home to use as your primary residence is the most common way people invest in real estate. This is the home you and your family live in all or at least most of the time. This is basically a long-term investment. You’re paying off your mortgage, and the home is (hopefully) going up in value.

Owning rental properties. Owning a second or third property to use as a rental has become an attractive way to invest in real estate. This is especially true here in Victoria, where students and families are often looking to rent properties.

You’ll need to check with your municipality for the rules around renting in your area to make sure they work for you. Look to buy in an area near schools, amenities, and other things that’ll appeal to potential renters. But overall, even if you need to take out an additional mortgage to buy the property, you should see a good return on your investment.

House Flipping. House flipping has become very trendy over the last few years due to the popularity of those hit shows on HGTV. However, it’s not as simple as it seems on TV. Yes, house flipping can be super profitable — but often, it’s a considerable risk.

You need to find a property you know you can make money off. Not only do you have to pay a good price for it, but you must have the skills or connections to be able to fix it up properly without spending a ton of money. Often, you’ll run into issues you didn’t even realize the house had — which usually costs more in both time and money. And it’s not uncommon to have to hang onto the house for a while if the market is low, which could cost you even more money.

Investing in the Stock Exchange. You can invest in real estate without buying a property by investing in shares on the stock exchange. There are a few different options for these.

Real Estate Investment Trusts (often referred to as REITs) own and operate a wide range of commercial properties you can buy shares of.  You can also investigate buying real estate-based Exchange Traded Funds (ETF) and mutual funds.

With the help of a qualified financial advisor, or by doing your own research, you can find something you’re comfortable investing in — which will hopefully have a history of giving a good return.

Rent-to-Own. Some rental properties are available as rent-to-own properties. This means a portion of your monthly rent goes towards the down payment towards the purchase of the property. You may require a deposit towards the eventual purchase when you start renting and be prepared to be on the current owner’s timeline for purchase.

Rent Out Part of Your Current Space. If you’re looking to make some money in real estate but don’t have cash in hand to purchase something right now, consider utilizing the property you already have.

Rent out an extra bedroom or your basement. Or convert your garage into a suite. Depending on the rules in your municipality, you may be able to consider short- or long-term rentals.

Want to Know More?

If you want to learn more about real estate investing, or you want to start looking for real estate in Victoria to use as an investment, contact us at the Garman Group today! We can help you find the ideal property to fit what you’re looking for.