Podcast 5: Is Buying a Property In this Market a Good Idea?

Market Update (May 2021)  Body: - If you are an end user, you have to focus on the fundamentals: Location, location, location - as long as you buy well, and you see yourself in the house over the long term, you will do well - certain pockets / neighbourhoods are always in demand no matter what - more upscale neighbourhood, less motivation / necessity to fire sale if market shifts - Low interest rates enable buyers to achieve their house goals in a more aggressive timeframe - construction cost / land costs constantly increasing - As an INVESTOR cashflow is king, important for house to carry over time - use leverage to your advantage & have tenants pay off the mortgage - multiple profit centres of real estate investing - cashflow - appreciation - leverage - mortgage pay down - tax incentives - In a typical investment property, assuming a 4% appreciation per year, and positive cashflow, you typically get 100% return on your investment in 4 years (return on your cash investment) - Even if the market were to correct by 50% from the purchase price, as long as the property has a positive cashflow, over 25 years, you still get 400% return on your initial cash investment - best time to buy real estate is YESTERDAY Business motivation: - As a business owner, I never want to spend my business income on lifestyle - I always aim to re-invest in real estate, and live of passive income - Passive income is income that I didn’t have to earn, and I feel better about spending it as opposed to business income, which is income that I had to work hard for