Get Real Wealthy

In this episode of Get Real Wealthy Season 2, Quentin talks about why multifamily apartments are better real estate investments.

Quentin says that the difference between apartments is that a one to four-unit apartment is considered residential while five-plus units would be commercial or multifamily. In the residential game, financing is different based on the number of units. When you're doing financing, you'll find out that the appraisal is different on a one to four-unit property than it is on a multifamily property. In a one-to-four-unit property, you have a comparative method, where similar properties in the vicinity are compared for price. For multifamily property, it's based on the Income Method; the net operating income of your property is going to define the value of the property. The type of financing you're going to get on that property will be based on the debt coverage ratio.

For financing rental properties, usually, the amount of equity you can release in a property is going to be based on what the rents are and what your income is, and that will allow you to release some equity in the property. In an apartment building, as it's based on the net operating income, oftentimes, you can release that equity a lot easier in a multifamily building. He adds, "one of the reasons why I like the multifamily space is the ability to use debt coverage ratios and then operating income to be able to release equity and take that equity and reinvest that into more buildings."

Quentin further says that another thing he likes about multifamily is that it's a small group of people. People know each other, and it takes time to develop the relationships that allow you to invest in those properties because there aren't many such buildings. He says that another good thing about multifamily buildings is the CMHC mortgages. This allows you to have 30, 35, and 40-year amortizations. It lowers your monthly costs and allows you to qualify for more of a mortgage. Another benefit of multifamily buildings is that there's a lot of demographic growth and that's driving demand. Additionally, you're often buying apartment buildings for lower than the replacement costs.

He further says, "Another thing I want to say is the repositioning the asset, we do the BRRR strategy of apartment buildings; buy, reposition, refinance and then continue to rent." Quentin says that cap rates are affected by three factors; location of the asset, interest rates, and the condition of the building.

In conclusion, he says that take a look at your portfolio. See if you want to invest in multifamily apartment buildings, and remember, Get Real Wealthy.

Important Links and Resources

• https://www.instagram.com/qmanrei

• [email protected]

• Book a 15 Minute Discovery Call

• https://EducationREI.ca

• https://GetRealWealthy.com

• https://DurhamREI.ca

Episode Summary

In this episode of Get Real Wealthy Season 2, Quentin talks about financing US properties for Canadians.

Quentin says that to increase the yield of any real estate investment, you need good financing. Financing can help you increase the yield on a property manifold. Mortgages are the power tools of real estate investing, and having great financing is essential. If you leverage it appropriately, it can make you very wealthy. He adds, "You're doing basically what governments are doing. Governments are borrowing money, and they are using it to be able to invest in infrastructure and people in things that they think are going to have the GDP of the economy."

He adds that you can do the same thing by investing in assets that will continue to pay you for years and decades to come. You should remember that returns will be related to how well and how much financing you can get. As a Canadian investing in the US, you are a foreign investor. They don't know you and don't have your credit history. So there are different things that you can do to help. Number one, there are Canadian banks in the US. You can get one mortgage, perhaps as a vacation property, through that bank, but it isn't a great way to build a portfolio of properties.

There are credit unions present both in Canada and the US. They are in specific states that you can utilize to help you purchase properties. Another approach that you can use is Foreign National Programs, which mortgage brokers in the US have. Oftentimes as this means that you can go up to 60% loan to value your interest rates are much higher. So, as long as the numbers work and you can utilize that leverage, you're still able to get that return in yield.

Another approach is using a portfolio loan. A US lender will put a mortgage behind all of those properties with one charge, especially if you have multiple properties that are smaller. Usually, they'll have a minimum loan size, like $250,000 or $300,000. Another option is to partner with a US citizen and have them qualify on the property for you. Another option is becoming a limited partner in general partnerships. He adds, "One of the strategies that I'm using down there, it allows me to invest in larger multifamily projects, but I have a tax structure for investing in the US that helps me avoid double taxation."

In conclusion, Quentin adds that if you want to learn more about his US investing, you can reach out to him on Instagram @qmanrei or email him at [email protected]

Important Links and Resources

• https://www.instagram.com/qmanrei

• [email protected]

• https://EducationREI.ca

• https://GetRealWealthy.com

• https://DurhamREI.ca

Episode Summary

In this episode of Get Real Wealthy Season 2, Quentin talks about the US investing for Canadian real estate investors.

Quentin shares that he invests in the US, and has a portfolio of both direct investments and limited partnership investments in the US. He says one of the reasons why he is investing in the US, on the limited partnership side is to develop relationships with boots on the ground and different general partners that are in the US is to help him grow his portfolio in a much bigger market. He further adds "By investing in other people's projects, I'm actually developing some of those relationships that will help me to continue to grow myself…"

He says that it's really important for him to invest to meet specific goals, and the goals for investing in the US can be the same as the goals for investing in Canada. He adds "for me, I'm investing in the US to hedge against the Canadian economy." He adds that it is also one of the ways you can protect yourself from any new government policies. Quentin says that another reason is that he likes to make US dollars when he is spending US dollars, especially when he visits his properties and different places across the border.

Quentin further adds that "another reason why I'm investing in the US is future pacing my personal financial goals." Another reason behind investing in the US is because he understands the process. He adds that from a returns perspective, he disagrees that you can get higher returns in the US than in Canada. It depends on the area, property types, and market you are working in, regardless of whether you are in Canada or the US.

In conclusion, he says that as a real estate investor, you need to decide for yourself if you're going to invest in the US. What are your reasons for doing it, and is it going to help you to achieve your own financial goals?

Important Links and Resources

• https://www.instagram.com/qmanrei

• https://EducationREI.ca

• https://GetRealWealthy.com

• https://DurhamREI.ca

In this episode of Get Real Wealthy Season 2, Quentin shares ten creative financing options that most real estate investors don't know.

Quentin says that the idea behind these creative options is that sometimes there are sometimes difficulties in getting financing or being able to purchase a property. As a real estate investor, you are a problem solver. He adds, "creative financing strategies actually helps you to acquire more properties, solve more problems, and getting cash flow and equity as payment of that, as well as mortgage, pay down."

Important Links and Resources

·        jointventurebook.com

·        https://www.instagram.com/qmanrei

·        https://EducationREI.ca

Episode Summary

In this episode of Get Real Wealthy Season 2, Quentin shares different tips to help you attract great tenants.

Quentin says that tenants can make or break a rental property. If you want to learn about the ways to select great tenants, you should check the previous episode. He says that it is really important to get great tenants in your property because the cost of eviction can be very high, especially if you're in a rent-controlled area. One of the first things he suggests is getting a copy of the book The Filling Vacancies Toolbox, which is a comprehensive guide to filling vacancies. He adds that first of all, you want to figure out who you are targeting in your ad. Make sure that the things and the benefits that you're describing would appeal to the tenant profile that you want to attract. 

Secondly, you want to have great titles for your ads, something to make them unique and stand out. When you're attracting great tenants, don't talk about the features. You want to talk about what's unique about the property like what are the benefits of living there? What are the things that can't be replaced by other properties? When you attract great tenants, you're attracting them right now to your rental ads. That is the best way to do it. That's the way that most people are going to interact with you. He further adds that another way to attract great tenants is to ask the tenants that you have that are great tenants for referrals. 

In conclusion, Quentin says that you can find plenty of tips like these in the book The Filling Vacancies Toolbox, which is a great tool for you to add to your toolbox when you're trying to find great tenants and place them in your rental properties.

Important Links and Resources

• The Filling Vacancies Toolbox by Quentin D'Souza
• https://EducationREI.ca
• https://GetRealWealthy.com
• https://DurhamREI.ca

Episode Summary

In this episode of Get Real Wealthy Season 2, Quentin talks about the differences between commercial financing and residential financing. 

Quentin says that residential financing is usually for one-to-four-unit properties, while commercial financing is usually used in the case of five or more properties. These could be industrial properties, retail properties, storage units, etc. The financing process is different depending on the type of financing. For example, for apartment buildings, you may only get a 75% to 70% loan to value if you're doing conventional financing. That means that you have a higher down payment. If you're doing a single-family home or a rental property, it's very possible that you can have a lower amount that you can put down, and get a higher loan to value.

With commercial financing, to get a higher loan to value you can use CMHC financing on commercial properties and you can go to 80%  to 85% loan to value, sometimes even higher. In conventional financing, you're usually doing 25-year amortization but if you are in commercial financing with CMHC, you can do 30, 35 years, sometimes even 40 years amortization, and this will lower your monthly cost. When you're looking at residential properties, typically, it's based on your debt coverage ratio, which means how much your property can debt service. 

He adds that if you are getting CMHC funding on a commercial property, it's going to take four or five months to get that and that usually isn't conducive to closing on an apartment building. So usually, you have to use some sort of bridge mortgage that gets you from the person to when CMHC financing is ready. He further adds that when you're looking at commercial buildings, you're usually looking at cap rate, the cap rate is made up of interest rate, the location of the property, and the quality of the asset. 

For residential properties, the cap rate is based on the comparative method. There is a lot more paperwork involved in the case of commercial financing as compared to residential financing, so he suggests preparing everything in digital format ahead of time. The broker fees in case of commercial financing are also very high. When you're dealing with financing for commercial property, often they're going to be asking for phase one, phase two, and hopefully, you never get to a phase three, but phase one is usually a historical understanding of the environmental contamination of a particular building. Once you get a phase two done and it comes back clean, then you're able to get your financing in place. 

You will also have to get a building condition report and appraisals, which can cost around $3,500 each. residential properties if you are doing a lower down payment because it's your first property not necessarily an investment property, but it could be if you're living in one of the units and it's a multi-unit property, you would be able to get a lower down payment and you would be paying that insurance or CMHC fee in order to do that.

Important Links and Resources

• https://EducationREI.ca
• https://GetRealWealthy.com
• https://DurhamREI.ca

In this episode of Get Real Wealthy Season 2, Quentin shares some tips that would help you pick better tenants. 

Quentin says that choosing and filtering tenants is probably the most important thing you can do for having a successful investment property. He shares some tips and strategies that can help you save your investment property from potentially troublesome tenants. First of all, you want to have a good title for your ad. It should contain good information about the benefits, not the features of the property. The great thing about online ads is that you can put lots of pictures and lots of details. That's something that you couldn't necessarily do in print advertising.

Once you've got that online ad, you do not want them to call you directly. What you would want to do is have them complete some sort of questionnaire. This will greatly help you figure out if this tenant is going to be a good fit for you. If you don’t want to show anyone the unit, never give any reason other than that we have decided to go with another tenant and leave it at that. Next, when you show the unit to the potential tenant, observe how they present themselves. You want to look for red flags during the conversation, and avoid people who seem dramatic or tell horrible stories about their previous landlords. 

So if you start to get a feeling from tenant, you're should inform them that you decided to go with another tenant, after they've already left. The next step is to go over the application. Did they complete everything? If they have mentioned references, follow up with them to find out their previous experience. Thirdly, go through their social media, as people tend to share a lot online these days. Next, you should go through the different tenant databases that are available and see if you could spot any red flags. The fifth step of the sub process is to do a credit check. You can use services like Rentcheck Crop, where members of Durham REI and Education REI. 

Lastly, he recommends using Rentify. It allows tenants to connect their bank account to the service and the service analyzes their bank account fees and they're picking up over the last 12 months to let you know if there have been any issues or any pet charges that appear in there. In conclusion, he says that when people are already giving you problems during the screening process, they're going to continue to give you problems throughout the tenancy. You can also check Quentin’s book The Property Management Toolbox to learn more.

Important Links and Resources

• The Property Management Toolbox
• https://EducationREI.ca
• https://GetRealWealthy.com
• https://DurhamREI.ca

Episode Summary

In this episode of Get Real Wealthy Season 2, Quentin talks about developing and having an investor mindset. 

Quentin shares that “as I have grown and become more experienced as a real estate investor, having done this for a very long time and acquiring, you know, quite a bit of a portfolio. I know that mindset is the most important thing and it has helped me to be able to grow and overcome the fear of doing different sorts of deals and getting things done.” He adds that overcoming fear is really important, especially when you have to do new things all the time.

Talking about one of his practices, which he has mentioned in his book The Action Taker's Real Estate Investing Planner, Quentin says that in the first chapter of the book, he has a quarterly plan, where he has a quarterly challenge. That challenge is something that takes him out of his comfort zone. By setting that challenge and developing that mindset, he is able to achieve things that he didn't think he could achieve before. It helps you to get over the fear of failure.  He further says “I think that sometimes we fear so much on making mistakes, and I don't really like to think of them as mistakes. I really like to think of it as like learning opportunities.” 

Quentin says that another fear is losing money. People are so afraid of losing money that they don't take action. You've got to develop that mindset that I am not going to lose money because I'm buying an asset that makes sense and I'm following these criteria. He adds “I want to have control over my future. I don't want to have somebody have control over me. And so I developed a mindset that allowed me to be able to do that.” As for the fear of making the wrong decision, he says that instead of worrying about picking the wrong side, do as much due diligence as you can and make the right decision that you believe is right, given all the information. 

In conclusion, he says that overcoming the fear of failure, losing money, looking bad to your friends and family, picking the wrong side and the fear of not being good enough will help you develop an investor mindset.

Important Links and Resources

• The Action Taker's Real Estate Investing Planner
•  actiontakerrealestateplanner.com free chapter
• https://EducationREI.ca
• https://GetRealWealthy.com
• https://DurhamREI.ca

Episode Summary

In this episode of Get Real Wealthy Season 2, Quentin talks about his book Scaling Up Toolbox, a how-to guide for real estate investors who don't have to use their own money to buy property.

Quentin talks about the book and why it's important to scale your portfolio, and why it's necessary to work with others. He says that real estate is a team business. If you can bring members on your team who become part of that inner circle, you can actually grow your portfolio and grow other people's portfolios at the same time. You can use a co-venture agreement in order to create a partnership together, where people play different roles. 

He adds that you should always have that co-venture agreement written or reviewed by a lawyer. You can find a template of the co-venture agreement that Quentin uses at DurhamREI.ca. There are different ways that you can structure a joint venture, depending on your level of involvement. He suggests consulting your accountant and your lawyer to make sure that you've got it covered from an accounting, legal and liability perspective. In addition, you should always talk to your insurance broker. Quentin further adds that you should make sure that all the things done in writing, do not do a handshake agreement. 

He says that you should make sure that you have those agreements signed and closed on, and everything reviewed before you close on the actual property itself. The next thing that you're going to want to do is watch out for provincial legislation and securities legislation. You do not want to be on the wrong side of securities legislation. In conclusion, Quentin announces that for a limited time, the listeners of the podcast can access this book on jointventurebook.com 

Important Links

• https://jointventurebook.com  
• https://EducationREI.ca
• https://GetRealWealthy.com
• https://DurhamREI.ca

Episode Summary

In this episode of Get Real Wealthy Season 2, Quentin talks about improving curb appeal. 

Quentin says that when it comes to attracting better tenents, curb appeal plays a huge role. You can develop a low-quality profile on your investment property by turning tenants away due to bad curb appeal. Quentin shares a few tips that can help you improve the curb appeal of a rental property or an apartment building. First, you need to have the area maintained. Whether it is grass in the garden or snow on the sidewalk, make sure that it is cleared and maintained. 

The next thing that you want to think about is the brickwork or the outside of the building. Some people clean up a building by spraying the brick, and it can look really sharp if it's done right. This can greatly improve the look and feel of the building. The next thing to look at is the entranceway. Make sure that there is no garbage on the floor, it is painted, and is kept up well. If you have an elevator, make sure that that area is cleaned, as well as any stairways in the building.

The next thing you want to ensure is that you have good lighting, especially on the exterior, around the building, and in the parking lot. It is important for safety reasons. You want to make sure that everybody feels safe. Another way to improve the curb appeal is to add security cameras. Lastly, you need to maintain and fix the driveways and the walkways if there are any bumps or worn-out patches. By implementing these tips, you can significantly improve the curb appeal of your property or your apartment building.

Important Links

• https://EducationREI.ca
• https://GetRealWealthy.com
• https://DurhamREI.ca