Real Estate advice

The Basics:

• (See Mortgage Rules Below)
• Save up $10k. (It is easier the younger you are)
• Buy a "shit-hole" condo in a great building. ~$180k
• Very few people want fix-r-upper condos. They are so cheap.
• Fix up and sell. Should make 50k.
• Repeat 3 times once a year. Use your 150k to buy a $399k house. Fix up and rent out.
• Cheaper Rent forever (with tenants+roommates)

What to look for in a Fixer-Upper:

• If a Condo, Finding a Good building is key.
• If a House, Finding a large building with "Good Bones" is key.
• Focus on finding Estate-sales, Former Grow-Ops, nightmare tenants, etc.
• Find a place that has already had remediation/upgrade work done.
• Don't overdo it on the renos.
• Many of the cheapest places were NOT on M.L.S. They were Private Sales.
• Ask Many Realtors & Friends looking for "hilariously dilapidated condos, that show poorly" but are within your budget and abilities to repair easily.

Property Assessment and Taxes:

• 2017 $546,100.Land $476,000.Buildings$70,100
• 2016 $460,700.Land $396,000.Buildings$64,700
• Tax Rate: 5.46263. Property Taxes: $2982.59. Home Owner Grant: $570

Advice:

Duplex Terminology:

I get confused all the time by this

• A "revenue duplex" is the whole house (left + right).
• Just a "duplex" is just half.

How to afford a condo on $22/hour:

$22/hour = $45,760/year -15% federal -5% provincial =$36,608. Which Qualifies for a $349K mortgage.
Save up $15K for downpayment by saving $15/day for 2.5 years.
(A)Buy 2 bed condo for: $239K. Mortgage $930/month, or
(B)Spend your max:$349K. Mortgage $1449/month.
Finally, get roommate for $800. You pay (A)$130/month or (B)$549/month.
Now, your mortgage costs you $4 a day.
Or better yet, put down an extra $800-$251/month and pay off your condo in 13 years. (That is just matching what your roommate pays).

Slightly-shittier life now, much easier later:

There are many much cheaper places.
I have always said if I was forced to rent, I would rent the ground floor unit #1@1179 Esquimalt Rd.
I had many friends lived there in the last 20 years. It is small, but very doable for the short term.
It used to be $110 /month in 2001.
In 2019 is was still $380/month.
With that, I could save 70% of my ($2542/month gross) wages, and have the $8900 down payment needed for the $178K bachelor condo @ 647 Michigan St. in 4-5 months.
And your mortgage would only be $724/month @2.25% interest.
Yes, Kids, previous debts etc may complicate things, but they ONLY increase the timeline, not the possibility.
https://www.realtor.ca/real-estate/22487538/808-647-michigan-st-victoria-james-bay

Many dirt-cheap rental places out there:

• Storage lockers,
• Garages,
• Short-term leases,
• Sublets,
• House undergoing renovations,
• Vacant building that let you live there FREE to provide security,
• Units you paint, clean, floor, etc for FREE rent,
• Perfectly-fine places that are being condemned (eg. Danbrook One @2766 Claude Rd $400/month),
• Hong-kong-sized rooms (eg. @ 1020 Pembroke street for $300/month)

Beggars cant' be choosy, especially for only for a few months while you save your down-payment.

How to Afford a $900k House:

• $45k Downpayment (5%)
• Borrowing $855k for 25 years @2.14% is $3,678.53 / Month
• Qualify with a combined pre-tax income would have to be $9,196.32 / mo ($110,356/yr)
• Garages
• Garages

Mortgage Rules, Totally Over-Simplified:

Updated 2018

• Current Interest Rates are around (3%)
• But you must pass "Stress Test": Qualify at Higher Interest Rate (5%)
• Minimum Down Payment is 5%.
• Example: $10k Down, on $200K Condo, for 25 years==$903/month.

Personally:

I am living proof this works. I wasn't lucky. I wasn't smart. I just followed a very simple plan. I have NEVER paid rent. (Moved right from my parents into condo at age 23)

For Perspective before Complaining:

People love to share this pic as their excuse to why they can't afford a house, and how earlier generations wrecked the market.

• Thats $116,493.75 in 2018 Dollars
• At only 3% interest for 56 years, it would be have grown to $623,744.68
• So considering a very-safe Government Bond rate (Average 6.8%), it was not a good investment, EXCEPT you got to live in it.

My Next Steps:

I never had as much fun in my life, as when built this home. I

• Was In the best (physical) shape of my life,
• Slept Well
• Worked every single day 8-14 hours,
• Friends were always over to visit or help,

I now have:

• Industry Connections
• Construction Experience
• Nearly every tool.
• A place to live.
• A (large) amount of equity.
• The time to build it right

I really want / need to do it again. So my options are:

• Build a "Garden House" ($50K) in the back yard.
  But I have to wait till at least 2019 for the new laws.
• Buy a DESTROYED Condo ($190K), fix it up for $8k - $10k, rent it out, then sell, and repeat.
  Can I qualify for another mortgage, or cash out equity?
• Sell My House, and Buy John's Beautiful(yet destroyed) Cabin in Duncan. ($320K, 16 acres).
  The commute would be a huge problem for me, even though I work at home.
• Sell My House, and Buy a piece of land in town, and build a house from scratch.
  Would require my house to sell for $760K+, and have a possiblility of finding a replacement property for no more than $450k.

Not the Right Time:

For 16 years. I've been told by so many:
I am so glad I didn't listen!
I am so glad I got my condo at age 22. And paid off my HOUSE at 37. You can do it too.

Videos:

Cabin idea Notes:

• One acre of Grass = 100 bails of hay==4500lbs==$450 = enough for 4.8 goats or 2.8 sheep.

Advice:

Non-MLS-listed house Sites:

• emilyOh
• youngAndThrifty
• forSaleByOwner