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@volitionproperties
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Quick Start!
Everything you need to know to get started in real estate investing
February 1st, 2020
@volitionproperties
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Good morning!!
@volitionproperties
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Filming and Photography
By taking part in this event you grant the event organisers full rights to use
the images resulting from the photography/video filming, and any
reproductions or adaptations of the images for publicity or other purposes
to help achieve the group’s aims. This might include (but is not limited to),
the right to use them in their printed and online publicity, social media,
press releases and funding applications. If you do not wish to be
photographed please inform an event organiser.
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Legal Disclaimer
Today’s event is provided for general informational purposes only and does
not constitute financial, investment, tax, legal or accounting advice nor does
it constitute an offer or solicitation to buy or sell any products, financial or
otherwise, referred to. Individual circumstances and current events are
critical to sound investment planning; anyone wishing to act should consult
with his or her advisor before doing so.
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Thank you!
● Ryerson University
○ Mike Chow and the AV Team
● Michael Rogers
○ Alien Tech Audio
● Janny Fu
○ Volition Properties
● Emir, Toyo, Monica
○ Helpers
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Agenda
● 9:00am -10:30am
○ Introductions
○ How to analyse real estate as an asset class
● 10:30am - 10:45am - BREAK
● 10:45am - Noon
○ Where is the best place to buy?
○ When is the best time to buy?
● NOON - ONE HOUR LUNCH AND NETWORKING
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Agenda
● 1:00pm - 2:30pm
○ How can I quit my job? How does real estate help me retire?
○ Is it all about the numbers/ROI?
● 2:30pm - 2:45pm - BREAK
● 2:45pm - 4:30pm
○ Financing Fundamentals
○ Insurance Fundamentals
○ Accounting Fundamentals
○ Expert Panel
○ Case Studies
● 4:30pm - NETWORKING
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WiFi To Stay Connected (20 min timeout)
Network Name/SSID - RU-
SECURE
Used ID (Name) -
ESRS2020
Password -
EsRs2020!#
@volitionproperties
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We’re going to structure this a bit differently...
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How will we handle questions today?
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Don’t forget to make notes on these gems
● T.I.M.E.
○ The four areas of risk when investing
○ Is it TIME to invest in Toronto??
● The cashflow myth
○ Cash flow is the biggest deal!
● Real People, Doing Real Stuff
● Case Studies
@volitionproperties
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Our intention for the day
● EVERY SINGLE PERSON to walk out of here understanding:
○ Why Toronto
○ What properties make sense
○ How to get started
● EVERY SINGLE PERSON having learned at least ONE tip/strategy that
will make them more money or save them more money
@volitionproperties
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Time to take action!
● Selfie icebreaker
● This person is your accountability partner for the day
● SHARE WITH THEM YOUR INTENTION FOR THE DAY
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Who are we?
@volitionproperties
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Who are Matt and Ming?
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ASIAN
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Who is Matt?
@volitionproperties
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@volitionproperties
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Who is Ming?
@volitionproperties
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Ming Lim - Investor,
Dad, Coach and Mentor
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How I started
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My first time
● 3 bedroom semi-detached
$115,000
● 5.00% Down - $5,750
● Rented for $1500 / month
● Cash flow - $700 / month!
@volitionproperties
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My first time
IT WAS ALL WRONG
● Property was illegal - more
people than allowed
● Illegally subdivided
● No license
● Parking didn’t meet regulations
What this my agents fault?
@volitionproperties
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Waterloo to Toronto
● Kept expanding in Waterloo - reached 21 doors
● Started investing in Toronto GTA
○ Townhouse, condo, duplex
● Two major things happened
○ Pain in the ass factor - student rentals - Headache adjusted ROI
○ Proper analysis of investments
■ Role of cash flow
■ Overall ROI
@volitionproperties
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Where am I now? What’s my “Belize”?
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Where am I now?
@volitionproperties
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The sunset is
so pretty,
Matt
Not as
pretty as
you, Ming
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Who is Sam?
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Who is Ed?
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Our guest speakers!
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Richard Tartaglia - Financing Expert
● Richard is a top performing Mortgage Agent who is passionate about
real estate investment. His success is attributed to referrals from
satisfied investors who have benefited from his strategic advice to
mortgage financing. Richard often stresses the importance of the
Blueprint approach to stay ahead of our consistently changing real
estate and lending environment.
● With a degree in Economics from McMaster University coupled with
over 8 years of banking and mortgage brokering experience, Richard
brings a very strong understanding of the mortgage financing
industry to the table.
● Richard is a winner of Scotiabank’s “Best of the Best” award on three
separate occasions. He was awarded Mortgage Alliance’s Masters
Club award in 2017, Elite Club award in 2018, and President’s Club
award in 2019 for attaining Top 5% in production, out of agents
across Canada.
@volitionproperties
www.volitionprop.com
Dan Tetzlaff - Insurance Expert
● Dan Tetzlaff oversees the Hub Ontario region real estate practice.
He manages over $5,000,000 in insurance real estate premiums and
has 10 years’ experience at the age of 35.
● Dan specializes in rental properties, Rent to own, student housing,
construction, surety, and large complex real estate schedules.
● Dan is partnered with some of the most prominent real estate groups
in Canada including the Canada Landlord Association, REIN, OREIO,
REITE club and many others.
● He lives in Leslieville with his wife and 2 young children.
@volitionproperties
www.volitionprop.com
Colton Hoekstra - Accounting Expert
● Colton is a tax accountant that works in the real estate division
for BDO Canada LLP.
● He has been working in the public accounting industry for 3
years working with both the tax and assurance teams.
● Colton is currently enrolled in the tax specialists program with
CPA Canada.
@volitionproperties
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Expert Panel!
Chris Flo Vinay
@volitionproperties
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Who is Volition?
Realty ManagementAdvisory
Mentorship &
Education &
Consultation
Acquisition of
Investment
Properties
Design &
Renovations
Leasing &
Property
Management
Renovations
@volitionproperties
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We Make Toronto Work (our new tagline!)
● Certified Real Estate Investment Advisors
● Toronto’s Exclusive Investor Realtor for REIN Buyer’s Group
● REIN Silver Investment Award, Bronze Investment Award
● Nominated for REIN’s Highest Award (Michael Millenear Leadership Award)
● $25M+ in personal holdings over 50 doors
● President’s Award, Chairman’s Award, Top Producer Award, New Homes Sales Award, Top 1% of all Realtors
in Toronto, etc
● Featured in Canadian Real Estate Investment Magazine
● Speaker at International Real Estate Investment Conferences, Expert panelist at numerous real estate events
● Run the largest & most active Meetup group
● Etc., Etc., Etc.
● The point is… we’re qualified. And only ~50 other Investor Realtors in Toronto (out of 50,000) are as qualified
as we are to help investors.
● And NO ONE ELSE in Toronto provides a complete end-to-end solution... all the services you need under one
umbrella in order to be successful.
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@volitionproperties
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5 years and going strong!
5 s
@volitionproperties
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Let’s start off with something
exciting: Case Study SNEAK PEAK
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If you had $350k right now...
● How much cashflow per month could you achieve in 12 years??
@volitionproperties
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How does real estate even make
money??
@volitionproperties
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@volitionproperties
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Mutual Funds
https://www.thebalance.com/good-annual-mutual-fund-return-4767418
From The Balance -
For stock mutual funds, a “good” long-term
return (annualized, for a period of 10 years
or more) is 8%-10%. For bond mutual funds,
a good long-term return would be 4%-5%.
@volitionproperties
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Stock Market
https://www.theglobeandmail.com/globe-investor/personal-finance/numbers-
never-lie-but-they-sure-can-deceive/article536314/
From The Globe and Mail -
While the annualized returns of the TSX
Total Return index was indeed 7.04% for
the past 10 calendar years, the average
return was 9.1%
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Real Estate Values Over the Long Term
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Incomplete Perspective - Investment vs. Business
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“Where is the best place to buy?
What is the best property to buy?”
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Where in the world should you invest?
● United States?
● Europe?
● South East Asia?
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What about other markets?
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Stable GDP Growth over
the past 10 years
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We’re not
corrupt!
Trust me! ;)
Corruption Perceptions Index 2018 - Transparency International
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Source: StatsCan
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● We’re a country of immigrants and the future
only shows further expansion
Source: StatsCan
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T.I.M.E in the Market
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T.I.M.E
● What separates sophisticated
investors from those who are
lucky?
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T.I.M.E
● What separates sophisticated
investors from those who are
lucky?
MANAGING MARKET DOWNTURN
AND RISK MITIGATION
● Everyone is an investing genius
when the market is good
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T.I.M.E
● It’s not “IF” the market will turn
down, it’s “WHEN”
● Prepare for it by investing against
fundamentals and use risk
mitigation strategies
@volitionproperties
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T.I.M.E
● TIME is the Volition acronym for
mitigating risk in your investment
strategy
@volitionproperties
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T.I.M.E.
Tenant Risk - Risk of a Bad Tenant
Investor Risk - Risk from lack of investor knowledge
Market Risk - Exposure to Market Changes
Estate Risk - Risk Inherent to the Property
@volitionproperties
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T.I.M.E.
Tenant Risk - Risk of a Bad Tenant
Investor Risk - Risk from lack of investor knowledge
Market Risk - Exposure to Market Changes
Estate Risk - Risk Inherent to the Property
@volitionproperties
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Ontario Risk vs The Rest of Canada
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Toronto mitigates Tenant Risk
● Major urban areas attract the best
tenant profile - Millennials
● Young Professional Millennials
○ university educated
○ $60-80k
○ Work in the downtown core
● Want to live / work / play in the
same area
● Don’t want to commute
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Toronto mitigates Tenant Risk
Why do we like Millennials?
● They pay their rent
● Pay for nice places, in good
locations
● They take care of their place
● THEY ARE TRANSIENT
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T.I.M.E.
Tenant Risk - Risk of a Bad Tenant
Investor Risk - Risk from lack of investor knowledge
Market Risk - Exposure to Market Changes
Estate Risk - Risk Inherent to the Property
@volitionproperties
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Investor Risk
● Do you know what you’re doing?
● Are you a local expert?
● Do you have a team to execute?
● What business models works in your area?
● What doesn’t work in your area?
● Who is your target demographic and how
are you servicing them?
@volitionproperties
www.volitionprop.com
T.I.M.E.
Tenant Risk - Risk of a Bad Tenant
Investor Risk - Risk from lack of investor knowledge
Market Risk - Exposure to Market Changes
Estate Risk - Risk Inherent to the Property
@volitionproperties
www.volitionprop.com
Toronto mitigates Market Risk
Major urban areas are more resilient to
changes in the market
● Diverse economy vs small single
industry town
● Job growth
● Economic growth, service based
economy, head offices, well paying
jobs
@volitionproperties
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Toronto mitigates Market Risk
A great economy leads too...
● Immigration
● Population Growth
● Low Vacancy Rates - less than 1%
● Lower cap rates = lower risk
Here’s some data to support this claim
that Toronto mitigates market risks
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Volition Metrics - Toronto Downtown Core
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Volition Metrics - Downtown municipalities
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Volition Metrics - Downtown SF Detached
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Toronto - Everywhere else
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Volition Metrics - Uptown municipalities
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Volition Metrics - Uptown SF Detached
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Toronto mitigates Market Risk
A great economy leads too...
● Immigration
● Population Growth
● Lower cap rates = lower risk
@volitionproperties
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Capitalization Rates - What do they mean?
Hey Ming - All things being equal - If I could
buy a property at 5% or 10% cap rate, I
should buy the property at 10% cap - right?
@volitionproperties
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Capitalization Rates - What do they mean?
Hey Ming - All things being equal - If I could
buy a property at 5% or 10% cap rate, I
should buy the property at 10% cap - right?
WRONG!
@volitionproperties
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Capitalization Rates - What do they mean?
● Everything isn’t equal
● If one property is cash flowing $1000 vs
$100 - there is a difference, you just
haven’t found it yet.
● Tenant profile? Local market conditions?
Single industry dependence? Declining
fundamentals?
WE ARE NOT SMARTER THAN THE MARKET
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T.I.M.E.
Tenant Risk - Risk of a Bad Tenant
Investor Risk - Risk from lack of investor knowledge
Market Risk - Exposure to Market Changes
Estate Risk - Risk Inherent to the Property
@volitionproperties
www.volitionprop.com
Estate Risk
● Are you buying the right investment property?
● 99% of “investment” properties DON’T WORK.
● Making sure you’re buying in the right areas.
● You can’t just say “Toronto”. You have to be
specific.
● What are you looking for in a
neighbourhood/area?
○ Gentrification
○ Transit
○ Infrastructure
@volitionproperties
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Soooo… What the best place to invest in?
@volitionproperties
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Soooo… What the best place to invest in?
@volitionproperties
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“When is the best time to buy?”
AKA “Is it TIME to invest in
Toronto?”
@volitionproperties
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Average Market
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FLAT Market
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DOWN Market
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What’s actually happened in Toronto
~7%
growth
over past
10 years
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But I still want to time the market!
● It’s not about timing the market, it’s about TIME IN the market.
● But if you want to time, time for buying spring. Why?
○ Finding good deals always the hardest thing in investing in any market
○ As a buyer, you want to be primed for maximum choices
○ Spring market starts in January!
○ Construction, if required is best done during the warm months.
@volitionproperties
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How can I quit my job?
@volitionproperties
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@volitionproperties
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First things first -
Understand the role of cashflow
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The Evolution of Investors
Stage 1 - Buy solely on appreciation
● Everyone understands buy low, sell
high
● Everyone in the room knows there
is more to investing than that
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The Evolution of Investors
Stage 2 - MAXIMUM Cashflow
● Get some education and decide
that Cashflow is King
● Many investor do it the detriment
of all else
● Where many investors are stuck
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The Evolution of Investors
Stage 3 - Understanding the ROLE of
cashflow
● Allows you to hold for the long
term - so equity can be built
● How does cashflow indicate risk?
● How does cashflow compare to the
rest of your real estate returns?
● When is cashflow important?
@volitionproperties
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Does cashflow really matter?
● $250 vs $500 cashflow a
month?
Is your life drastically different??
How does that compare to your
overall returns??
So what is cashflow good for??
@volitionproperties
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Cashflow = Hold for the long term
● The role of cash flow is to allow you to
continue to hold your properties for
the long term, thru the ups and downs,
so that you are not forced to divest at
the wrong time.
@volitionproperties
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Cashflow is less in Toronto because the market
is less risky!
● Investing in Toronto is less risky
● Remember TIME and how Toronto mitigates
risk
@volitionproperties
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How does cashflow compare to appreciation?
What would you choose?
5% appreciation and $2000 in cashflow
OR
7% appreciation and $500 in cashflow
@volitionproperties
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5% Appreciation and $2000 Cash Flow
Value of Property $1,000,000
Down Payment 20%
Annual Interest Rate 4.00%
Years 25
Payments Per Year 12
Mortgage Amount $800,000
Appreciation 5.00%
Total Periods 300
Rent Increase 5%
Monthly Cash Flow $2,000
Final Property Value $3,466,845
Final Equity Built $4,443,095
@volitionproperties
www.volitionprop.com
7% Appreciation and $500 Cash Flow
Value of Property $1,000,000
Down Payment 20%
Annual Interest Rate 4.00%
Years 25
Payments Per Year 12
Mortgage Amount $800,000
Appreciation 7.00%
Total Periods 300
Rent Increase 5%
Monthly Cash Flow $500
Final Property Value $5,692,214
Final Equity Built $5,936,276
@volitionproperties
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The impact of cash flow vs appreciation
5% and $2k cashflow $4,443,095
7% and $500 cashflow $5,936,276
Delta $1,493,181
What’s the important take away?
@volitionproperties
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Don’t buy negative cashflow
● Do not buy negative cash flowing properties
○ Can’t handle a dynamic investing environment
■ Property Expenses - Repairs, utilities, etc.
■ Market Changes - Rental control changes
○ Not scalable
■ Would you invest in a business that lost more money
the larger it got?
Cash flow is important but not the expense of all else!
@volitionproperties
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So when do you need cash flow
● You need cash flow at the
“end”
● So when is the end?
@volitionproperties
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Simple Approach. Buy one and
wait 30 years.
@volitionproperties
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Basic Scenario
● Buy $1.4M triplex
● Wait 30 years to pay it off
What’s the result?
@volitionproperties
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Basic Scenario
● Buy $1.4M triplex
● Wait 30 years to pay it off
What’s the result?
● How do we do BETTER than this?
● How do we do it FASTER than this?
● What are we LEAVING ON THE TABLE?
@volitionproperties
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Sophisticated Approach.
The Volition Approach.
@volitionproperties
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The Volition Way
● Buy $1.4M triplex
● Wait 4 years
● Refinance
● Go buy another one
● Wait 8 years
● Reach 50% LTV
● Sell off half, pay off the mortgage of the other half
What’s the result?
● SHORTER AMOUNT OF TIME
● LARGER PORTFOLIO
● MORE CASHFLOW
● (...but more work)
● More on this later.
@volitionproperties
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Is it all just about the numbers?
@volitionproperties
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@volitionproperties
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Don’t buy cheap, buy for *value*
Cheap and expensive
are relative concepts
Buy for value, not on
price alone
@volitionproperties
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Building Your Team
@volitionproperties
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Building your team
● You’re running a small
business
● You’re the CEO
● The success of your
business hinges on getting
*the* best people
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Building your team
● Key people
○ Accounting
○ Financing
○ Insurance
○ Legal
○ Realtor
● Are they investors?
@volitionproperties
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Building your team
● Key people
○ Accounting
○ Financing
○ Insurance
○ Legal
○ Realtor
● Are they investors?
@volitionproperties
www.volitionprop.com
Get an Investor Realtor - Not Uncle Joe
● If you wanted to learn more or talk
more about real estate investing,
who do you talk to?
● If you wanted to invest in real estate,
most real estate agents will go “OK
GREAT!! Let’s go buy you a condo!”
● Get a customized plan that is specific
to you and your situation. This is
NOT a one-size-fits-all.
@volitionproperties
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Financing!
@volitionproperties
www.volitionprop.com
Richard Tartaglia - Financing Expert
● Richard is a top performing Mortgage Agent who is passionate about
real estate investment. His success is attributed to referrals from
satisfied investors who have benefited from his strategic advice to
mortgage financing. Richard often stresses the importance of the
Blueprint approach to stay ahead of our consistently changing real
estate and lending environment.
● With a degree in Economics from McMaster University coupled with
over 8 years of banking and mortgage brokering experience, Richard
brings a very strong understanding of the mortgage financing
industry to the table.
● Richard is a winner of Scotiabank’s “Best of the Best” award on three
separate occasions. He was awarded Mortgage Alliance’s Masters
Club award in 2017, Elite Club award in 2018, and President’s Club
award in 2019 for attaining Top 5% in production, out of agents
across Canada.
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
Insurance!
@volitionproperties
www.volitionprop.com
Dan Tetzlaff - Insurance Expert
● Dan Tetzlaff oversees the Hub Ontario region real estate practice.
He manages over $5,000,000 in insurance real estate premiums and
has 10 years’ experience at the age of 35.
● Dan specializes in rental properties, Rent to own, student housing,
construction, surety, and large complex real estate schedules.
● Dan is partnered with some of the most prominent real estate groups
in Canada including the Canada Landlord Association, REIN, OREIO,
REITE club and many others.
● He lives in Leslieville with his wife and 2 young children.
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
Accounting!
@volitionproperties
www.volitionprop.com
Colton Hoekstra - Accounting Expert
● Colton is a tax accountant that works in the real estate division
for BDO Canada LLP.
● He has been working in the public accounting industry for 3
years working with both the tax and assurance teams.
● Colton is currently enrolled in the tax specialists program with
CPA Canada.
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
Our Expert Panel
Real People, Doing Real $#}+!
@volitionproperties
www.volitionprop.com
Our Panel - REAL People, doing real $#}+!
● Florence Lee
● Chris Law
● Vinay Kanthan
@volitionproperties
www.volitionprop.com
Other business models
@volitionproperties
www.volitionprop.com
Advanced Investing (beyond today’s scope)
● Laneway Housing
● Development
● Executive Rentals
● Advanced Financing
● Luxury Triplex Conversions
● BRRR(R)
● Leasing & Property Management Tips
@volitionproperties
www.volitionprop.com
Case Studies
@volitionproperties
www.volitionprop.com
What to buy at $350k of capital
● Wait, who has $350k lying around?
● HELOC, Refi, RRSP’s, JVs, etc.
● No one has $350k lying around and no
one should have $350k uninvested!
@volitionproperties
www.volitionprop.com
An example of what to buy - $350k of capital
● Turnkey triplex
○ Purchase Price - $1.4MM
○ Initial Investment (Down, Tax, Closing) - $333k
○ Rents - $6500
○ Expenses - $1100
○ Mortgage Payment (3.3%, 30yr am) - $4,905
○ Monthly Cashflow - $495
@volitionproperties
www.volitionprop.com
An example of what to buy - $350k of capital
@volitionproperties
www.volitionprop.com
An example of what to buy to maximize return
@volitionproperties
www.volitionprop.com
An example of what to buy to maximize return
@volitionproperties
www.volitionprop.com
An example of what to buy to maximize return
@volitionproperties
www.volitionprop.com
An example of what to buy to maximize return
@volitionproperties
www.volitionprop.com
An example of what to buy to maximize return
@volitionproperties
www.volitionprop.com
What do I buy?
@volitionproperties
www.volitionprop.com
Luxury Triplex
Conversion
Turnkey Triplex Condo Preconstruction
Condo
Small Town
Tenant Profile A+ A+ A+ A+ F
Short Term
Headache
F A- A A+ F
Long Term
Headache
A+ B+ A A F
Short Term ROI A+ A- C C C
Long Term ROI A+ A B- B- D
Affordability F C A A+ A+++
Pros New, Cashflow Own land Entry-level $150k Deposit structure Cheap, Cashflow
Cons $800k+ required $350k+ required Cashflow is hard at
20% down
Can’t get rent or sell
in the short term
Higher risk
Overall A A- B+ B+ D
@volitionproperties
www.volitionprop.com
**JOURNEY TO MASSIVE
CASHFLOW OF $10k/month!!
(SCAM ALERT!!)**
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – 3 Questions
THE THREE MOST IMPORTANT QUESTIONS
Where are you at?
● Existing properties: ?
● Household income: $200k
● Cash $90k, Stocks, $25k, RRSP $10k
Where do you want to go?
● “Want the flexibility to work when I want to (contract
work, retire early, do something else, etc.)”
● Think: FORM
● Goals: $5000/month ($60,000/year)
When do you want to be there?
● When? They don’t know. (But they should know!!).
Typical answer. “I don’t know what is realistic to
expect” is a very common response.
● You need clarity on this!!
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – Step 1
Step 1: Analyze their portfolio at 80% LTV
● Maximum equity takeout
○ Tommy condo:
○ Gina condo:
● Cashflow after refi
○ Tommy condo:
○ Gina condo:
● Total capital after refi:
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – Step 2
Step 2: Acquisition Phase
● Determine what their capital can buy
● Determine mortgage qualification ability
● ASSUMPTION FOR THIS SCENARIO
○ Triplex, $1.2M, $500 cashflow
● Run financials & cashflow for all properties:
1. Property #1
2. Property #2
3. Property #3
4. Property #4
● ARE WE CLOSE?
○ Cashflow: ??
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – Step 3A
Step 3. Choose Your Own Adventure
Scenario A – Lazy Approach
● Wait 12 years.
● What happens during this time?
○ Property Value
○ Rents
○ Interest Rates
○ Inflation
● Run financials & cashflow for all properties according to
assumptions:
1. Property #1
2. Property #2
3. Property #3
4. Property #4
● ARE WE CLOSE?
○ Cashflow:
○ Net Worth:
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – Teaching Moment
TEACHING MOMENT!!
● Point of this session?
○ Tips & tricks??
● Variables to Play with
○ Time
○ Appreciation
○ Interest Rates
○ Rent growth
● What is the MOST important variable?
● Key Learning Takeaways
○ Role of Cashflow
○ Importance of Time / Getting started early
○ WHY the “Lazy” scenario may be a good one for
you?
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – Step 3B
Step 3. Choose Your Own Adventure
Scenario B – TAKE MASSIVE ACTION Approach
● DOUBLE YOUR PORTFOLIO IN 4 YEARS
● THEN SELL HALF
● PAY OFF MORTGAGES FOR MASSIVE CASHFLOW
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – Step 3B Equity Takeout
Step 3. Choose Your Own Adventure
Scenario B – TAKE MASSIVE ACTION Approach
● IN 4 YEARS, DO EQUITY TAKEOUT
● What is Value, Mortgage, Equity Takeout, Cashflow for:
● Property #1
● Property #2
● Property #3
● Property #4
● ARE WE CLOSE?
○ Cashflow:
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – Step 3B Double Portfolio
Step 3. Choose Your Own Adventure
Scenario B – TAKE MASSIVE ACTION Approach
● DOUBLE YOUR PORTFOLIO
● For simplicity sake, assume that you're buy the EXACT
same property that you did refinance.
● What is Value, Mortgage, Equity Takeout, Cashflow for:
○ Property #1
○ Property #2
○ Property #3
○ Property #4
○ Property #5 (SAME AS PROPERTY #1)
○ Property #6 (SAME AS PROPERTY #2)
○ Property #7 (SAME AS PROPERTY #3)
○ Property #8 (SAME AS PROPERTY #4)
● ARE WE CLOSE?
○ Cashflow:
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – Step 3B Wait
Step 3. Choose Your Own Adventure
Scenario B – TAKE MASSIVE ACTION Approach
● WAIT 8 YEARS.
● What's the magic of 8 years? (Assumption of 5%
growth)
● You are aiming to get to 50% LTV.
● What is Value, Mortgage for:
○ Property #1
○ Property #2
○ Property #3
○ Property #4
○ Property #5 (SAME AS PROPERTY #1)
○ Property #6 (SAME AS PROPERTY #2)
○ Property #7 (SAME AS PROPERTY #3)
○ Property #8 (SAME AS PROPERTY #4)
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – Step 3B Divest
Step 3. Choose Your Own Adventure
Scenario B – TAKE MASSIVE ACTION Approach
● DIVEST STAGE. SELL OFF HALF.
● What is Value, Mortgage for:
○ Property #1
○ Property #2
○ Property #3
○ Property #4
● What is Net Proceeds after (proceeds after Realtor &
Capital Gains)
○ Property #5
○ Property #6
○ Property #7
○ Property #8
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow - Step 3B Pay off
mortgage
Step 3. Choose Your Own Adventure
Scenario B – TAKE MASSIVE ACTION Approach
● PAY OFF MORTGAGES OF THE OTHER HALF.
● (Assume that it lines up)
● What is Value, Mortgage, Rents, Cashflow for:
○ Property #1
○ Property #2
○ Property #3
○ Property #4
● Total Cashflow:
○ Does this fall short / meet / exceed goals?
@volitionproperties
www.volitionprop.com
Journey to $10k Cashflow – Teaching Moment
TEACHING MOMENT!!
● This is a more aggressive of a scenario.
● Limiting factors
○ Refi mortgages
○ Acquisition mortgages
○ DON’T WASTE MORTGAGES ON SMALLER
CHEAPER PROPERTIES (i.e. outside Toronto)
● What is the watershed moment?
● Variables/factors:
○ Appreciation
○ Interest rates?
● Doesn’t have to be this prescriptive. Customize it for
yourself:
○ 4 years to double
○ 8 years to 50% LTV
○ Sell off half, pay off mortgages
● BEWARE:
○ The “Myth” of Cashflow
○ Pitfalls?
@volitionproperties
www.volitionprop.com
Now What?
@volitionproperties
www.volitionprop.com
Find Your Accountability Partner
● 2 minutes: Share with them something you learned today that will
make you more money or save you money?
● Who did not learn ANYTHING?... Let’s rectify that.
@volitionproperties
www.volitionprop.com
Sign up for Advisory today!
● If you end up working with us, you get your
money back on today’s ticket!
● 60 Minute Advisory Consultation
● We will help you determine
○ Where you are at
○ Where you want to go
○ Help you build a customized plan to get there
● Sign up with Janny and her team
@volitionproperties
www.volitionprop.com
Video Testimonial - FREEBIE!
● See Mike to provide a few words on
why you found today helpful
● FREE PASS TO OUR NEXT MEETUP!!
@volitionproperties
www.volitionprop.com
Next Month - Regular meetup at Creeds!
● Mar 18th at Creeds
● Network and Learn!
@volitionproperties
www.volitionprop.com
Networking Time!
Your network is your net worth
Some questions to get you started
● What brought you here today?
● Are you already invested?
● Where do you invest?
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
THANK YOU!
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
@volitionproperties
www.volitionprop.com
OLD
PRESENTATIO
N BELOW
@volitionproperties
www.volitionprop.com
Introduction To Real Estate
Investing in Toronto
@volitionproperties
www.volitionprop.com
Is now the right time to invest?
● Should I buy now?
● Should I wait?
● How do I know when the right time to invest is?
@volitionproperties
www.volitionprop.com
Is now the right time to invest?
● Sound real estate investment strategies are based on long term returns
and are not reliant on market timing
● Ming’s Favourite Saying: “...............”
● Long term investing is critical - here is why
@volitionproperties
www.volitionprop.com
How Real Estate Builds Wealth
@volitionproperties
www.volitionprop.com
Appreciation for the long term - how do you
get it?
@volitionproperties
www.volitionprop.com
Appreciation for the long term - how do you
get it?
LOCATION! LOCATION! LOCATION!
@volitionproperties
www.volitionprop.com
How to eventually live off your cashflow?
● The Multiplier effect is how you get to lots of doors or significant cash
flow
● Whenever you hear about someone who has 20+ doors, this is how it
was done
@volitionproperties
www.volitionprop.com
Long term buy and hold looks great. But what
about...
● What about flipping?
● Wholesaling?
● Development?
@volitionproperties
www.volitionprop.com
Long term buy and hold looks great. But what
about...
● What about flipping?
● Wholesaling?
● Development?
SHORT TERM
MARKET RISK!
@volitionproperties
www.volitionprop.com
Where do I invest?
● 4 areas of Risk
● What the best place to invest in?
● Look at your customer - target demographic
○ Why is this the best demographic
● Look at long term appreciation of the property
○ Transit
○ Job Market and population growth
@volitionproperties
www.volitionprop.com
This even applies to your personal residence
● My personal residence
○ Investment Pros
■ Yonge and Sheppard
■ Near public transit, access to highways, school
■ Bought land not house
■ Duplex
○ Investment Cons
■ Low rents compared to downtown
● Purchased for $500k. Now worth $1.5MM
● Original rent was $1000 now rents for $3800

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Volition Quick Start Presentation - Feb 1st 2020

Hinweis der Redaktion

  1. We get asked all the time “Are you agents?”. Yes, we are agents, but we are so much more than that. We are not just service providers, we are SOLUTIONS providers. What I mean by that is that we provide EVERYTHING you need under our umbrella in order to for you to successful in your real estate investments.
  2. What makes us qualified to stand up here before you speaking to you about investing in Real Estate? We could very well be a bunch of hacks, right? Bunch of other awards as well. President’s Award, Chairman’s award, Top Producer award, top 1% of all Realtors in Toronto, etc. But we’ll skip forward. This isn’t about us, it’s about you.
  3. Our mandate is enabling YOU and supporting YOU in your real estate journey. Keep this in mind… because I want to ask it again at the end to see if you think that we are (or can be) “the eraser” for you. The team who is blazing the trail before you, removing obstacles for you, helping you move forward.
  4. $350k gets you a turnkey triplex at $1.4M with $6700 in rent and $500 cashflow. And in 12 years, that is... $5k of cashflow. Not bad, right? BUT HOW CAN WE DO BETTER?? More on these later.
  5. This doesn’t tell the whole story. (IMAGE: “incomplete perspective”) Equities/stocks/bonds/etc are investments RE Investing is a misnomer. You’re buying a BUSINESS. So there are other factors to consider beyond More on this later
  6. When investing in “real estate” you could invest anywhere in the world. Limitless possibilities US, Japan, Europe?
  7. More on the “what type of property should I buy” in the case study section later today.
  8. Do you know what you’re doing? What risks do you bring to the table from lack of knowledge? Not about beating you down for not knowing, but being self aware on your gaps in knowledge. Local expert Real estate is local, some might even say hyperlocal. What do I mean by that? Is there such a thing as a Canadian Market? How about an Ontario market? Or Toronto Market? Cabbagetown is a place where farmers grow produce, you shouldn't invest in Toronto How do you fill your knowledge gaps? With the best team More later What business models work in your area? Executive rentals? BRRR? AirBnb? What’s happening with regulation changes? Are they enforaceable? How are you servicing your target demographic?
  9. *Major* urban areas that aren’t tied to a single industry - Edmonton Job Growth Toronto #3 in tech jobs in NA behind San Fran and Seattle Health care, Finance, aerospace, service based, telcom, logistics, and tech saw growth in job 10-25% in the past ten years. In Fact, jobs are moving away from rural and suburban areas so quickly, Globe and Mail calling it a “hyper-concentration” of jobs in Toronto
  10. Lower cap rates means lower risk. Does everyone know what cap rate is? Net Operating Income (NOI) divide by property value. NOI = all revenue from the property minus operating expenses. Ex: $10,000 NOI / $100,000 Property Value = 10% Cap Rate
  11. Further zoom out
  12. Toronto Market Index shared on Volition Drive This uses the Home Price Index. Like for like properties. Better than sales averages.
  13. Most investment properties don’t work Friend sent me a bachelor condo in Windsor recently Bachelor pad in windsor Right demographic? Long term appreciation? Transit / infrastructure? Job growth? 99% of investment properties in Toronto don’t work for the same reasons
  14. Does everyone understand the concept of cashflow?
  15. Doesn’t make much of a difference. Cashflow is more about bragging rights.
  16. Now, we’re not saying buy cashflow negative properties.
  17. Refer back to INCOMPLETE PERSPECTIVE Do you really want to be managing 50-100 units? Do you NEED to in order to achieve your goals? 10X - scale. Do you want to be dealing with shitty tenants Do you really want to be using up your mortgage qualification on SMALLER mortgage amounts. You’re limiting yourself. PM headache is YOUR headache THESE are the reasons why to consider Toronto. ON THE NEXT SLIDE --- Don’t need to be chasing cheap properties or high cashflow
  18. 1) Please give a brief intro about yourself. 2) What is the one piece of advice you wish you could give yourself when you started investing? 3) If you could do anything differently with regards to investing, what would it be?
  19. The point is, there is no one-size-fits-all investment. It will heavily depend on you, your life situation, your financial situation, your time horizon, your risk tolerance, your mortgage qualification ability, etc. A great team should create a customized solution mandate is to remove all the complexity so that you can make clear choices that make sense in your context. Our mandate is to co-create with you a customized solution that will help you achieve your life goals by supporting your financial goals (in the context of real estate). Things change, the market changes, what made sense 3 months ago may no longer be make sense (or not be available anymore). A investment fund manager doesn’t always tell his clients to buy the same stock over and over again, he will advise based on the market conditions, etc. At certain times, we may suggest precon condo. At other times, we may suggest resale condo. At the SAME time we may suggest precon condo to one client, and resale condo to another And we may also suggest triplex, fourplex, sixplex to another client. And we may suggest for one client to be divesting his condo, while we’re advising another client to be investing in condos. Everyone is at a different point in their investment career, and at different points in their trajectory to reaching their own individualized goals. Given a boost in the number of units coming online this year (I’ve heard that normally it’s 15,000 in Toronto, and 2019 it’s 25,000) assignments may be an important strategy The other question is: given a particular property, what RENTAL strategy do I employ in order to maximize or boost rents? Moving forward into 2019, this may be the most important question These strategy may include: AirBnB? (what happens in July?) Short term rental? (what happens in July?) Executive Rental (Relocation of executives, etc.) (what happens in July?) “House Hacking”. Purchasing a unit with multiple bedrooms and renting out individually to young professionals, students, etc. Turning dens into functional bedrooms. Remember: These are (for the most part) all strategies for the SHORT TERM. With rising rents, you will reach a point that you can easily switch over to long-term rentals again. We are only employing these strategies in order to get thru the short term.
  20. Deep-dive, real-life, real-time analysis of your mortgage qualification ability As if it was a real consultation, and your application was really being underwritten. (Speaking of which, Vine Group is looking for an in-house underwriter. If you’re super smart and willing to learn, let me know and I’ll pass along his contact).
  21. The important thing isn't trying to squeeze out cashflow by but into crappier areas. He important thing is buying in good areas and starting early.