WEBVTT 00:00:01.040 --> 00:00:03.620 Hello, and welcome to the Spotlight Vancouver 00:00:03.620 --> 00:00:06.679 podcast. I am your host, Doug Varinas, licensed 00:00:06.679 --> 00:00:09.919 realtor in Washington and Oregon. And on today's 00:00:09.919 --> 00:00:11.740 show, we're going to talk a little bit about 00:00:11.740 --> 00:00:14.519 investing, why you should invest in Vancouver, 00:00:14.539 --> 00:00:17.280 Washington, and what are some real estate investment 00:00:17.280 --> 00:00:19.879 strategies that are working today, giving you 00:00:19.879 --> 00:00:22.780 kind of an overview on your options and what 00:00:22.780 --> 00:00:25.300 is best. This is going to be very individual, 00:00:25.300 --> 00:00:28.160 so let's get right into it. So as an investor, 00:00:28.460 --> 00:00:32.140 What I am primarily looking for in a real estate 00:00:32.140 --> 00:00:36.140 market is I want to see population growth. I 00:00:36.140 --> 00:00:38.659 also want to see economic growth and development, 00:00:38.759 --> 00:00:41.679 and I want to see rental growth. And Vancouver 00:00:41.679 --> 00:00:45.479 really has all of these in spades and why I think 00:00:45.479 --> 00:00:48.840 it's going to continue to perform very well, 00:00:49.119 --> 00:00:52.380 especially relative to other cities in this area 00:00:52.380 --> 00:00:56.590 and along the West Coast. And so I think the 00:00:56.590 --> 00:00:58.530 most important thing to ask yourself if you're 00:00:58.530 --> 00:01:02.210 looking to invest is what you're looking to get 00:01:02.210 --> 00:01:05.290 out of it. What do you want the outcome to be 00:01:05.290 --> 00:01:08.250 from real estate investing? So there's a lot 00:01:08.250 --> 00:01:10.730 of people out there that have tons of equity 00:01:10.730 --> 00:01:13.890 in their homes currently, and maybe that's you, 00:01:13.890 --> 00:01:15.629 and you're looking to put some of that equity 00:01:15.629 --> 00:01:18.549 to work because it's just sitting there, it's 00:01:18.549 --> 00:01:22.650 untapped, own your home, and you have additional 00:01:22.650 --> 00:01:24.950 savings that you're thinking about putting towards 00:01:24.950 --> 00:01:28.269 real estate investing. There's a lot of options 00:01:28.269 --> 00:01:30.510 out there for a real estate investor, and it's 00:01:30.510 --> 00:01:33.650 easy to get super confused as to what's the best 00:01:33.650 --> 00:01:37.680 one. What's the best one? as far as which one's 00:01:37.680 --> 00:01:39.879 gonna outperform, which one's gonna give you 00:01:39.879 --> 00:01:43.159 the most return on your investment. But speaking 00:01:43.159 --> 00:01:47.260 from experience, I must say that the most important 00:01:47.260 --> 00:01:49.599 question you need to ask is what are you trying 00:01:49.599 --> 00:01:53.680 to do? So are you looking to replace your current 00:01:53.680 --> 00:01:56.260 income, cover all your expenses with monthly 00:01:56.260 --> 00:01:59.420 cashflow? Are you looking to build equity so 00:01:59.420 --> 00:02:03.590 you can cash out? retirement age or in 10, 20 00:02:03.590 --> 00:02:06.969 years, are you looking to build up capital in 00:02:06.969 --> 00:02:10.310 a more quick fashion? What are you trying to 00:02:10.310 --> 00:02:13.909 do? And that's really where I'd recommend starting 00:02:13.909 --> 00:02:16.250 because if you don't know that there's a million 00:02:16.250 --> 00:02:18.969 different directions you can get pulled and it's 00:02:18.969 --> 00:02:22.030 going to potentially have some negative impact 00:02:22.030 --> 00:02:25.069 on your financial situation and it might cause 00:02:25.069 --> 00:02:28.069 some some headaches for you. And I'll give you 00:02:28.069 --> 00:02:31.270 an example. Like I used to chase a cashflow quite 00:02:31.270 --> 00:02:35.069 a bit. So I wanted to maximize my monthly amount 00:02:35.069 --> 00:02:37.530 that I got out of a rental property, which is 00:02:37.530 --> 00:02:40.210 great. Makes sense, right? But I'm going to tell 00:02:40.210 --> 00:02:42.810 you that a lot of times chasing cashflow is going 00:02:42.810 --> 00:02:45.969 to lead to a whole bunch of other problems because 00:02:45.969 --> 00:02:48.050 when you do that, you're typically looking at 00:02:48.199 --> 00:02:51.479 lower price properties in areas that just maybe 00:02:51.479 --> 00:02:54.659 not as good C, C minus neighborhoods, maybe even 00:02:54.659 --> 00:02:59.599 a D class neighborhood where on paper, yes, you're 00:02:59.599 --> 00:03:02.479 going to make a lot of money every month. Maybe 00:03:02.479 --> 00:03:04.759 it's 500 bucks a month, which is pretty good 00:03:04.759 --> 00:03:08.860 for cash flow on a property, especially nowadays, 00:03:09.159 --> 00:03:11.419 pretty much impossible to find around here. I 00:03:11.419 --> 00:03:13.719 mean, not impossible, but very difficult. And 00:03:13.719 --> 00:03:18.259 so what you get with that situation is you get 00:03:18.259 --> 00:03:21.340 tons of headaches as far as like your tenants 00:03:21.340 --> 00:03:24.379 so you're gonna typically those properties just 00:03:24.379 --> 00:03:28.520 given the fact of where they're at and the price 00:03:28.520 --> 00:03:30.479 point you're gonna attract tenants who might 00:03:30.479 --> 00:03:33.659 not pay rent so you're gonna have to either you 00:03:33.659 --> 00:03:37.199 know get stiffed on rent or the tenant does damage 00:03:37.199 --> 00:03:39.300 to your property that you're gonna have to repair 00:03:40.270 --> 00:03:42.729 the home in general might be in disrepair. So 00:03:42.729 --> 00:03:44.669 you're going to have those capital expenses of 00:03:44.669 --> 00:03:47.990 like roofs and HVAC and everything. And so what 00:03:47.990 --> 00:03:50.849 you thought was going to cashflow is not cash 00:03:50.849 --> 00:03:55.169 flowing. And so again, by figuring out where 00:03:55.169 --> 00:03:58.569 you want to go, you can figure out the best way 00:03:58.569 --> 00:04:02.210 to get there. So a little overview of Vancouver 00:04:02.210 --> 00:04:05.449 and why I like it is population growth. And I'm 00:04:05.449 --> 00:04:10.840 looking at about 1 % growth in population per 00:04:10.840 --> 00:04:16.839 year. It's grown 4 .5 % since 2020, Vancouver 00:04:16.839 --> 00:04:21.279 that is, and Clark County in general since 2010 00:04:21.279 --> 00:04:26.220 has grown just over 24%. So we're seeing a lot 00:04:26.220 --> 00:04:28.720 of growth here in population, which means people 00:04:28.720 --> 00:04:31.259 are moving here. And that is really great because 00:04:31.259 --> 00:04:34.420 that's going to raise the demand for rental properties, 00:04:34.540 --> 00:04:36.949 which you want to see. So I'm always looking 00:04:36.949 --> 00:04:39.550 for population growth. Another one is development. 00:04:39.870 --> 00:04:41.790 We've already seen a lot of waterfront development. 00:04:42.170 --> 00:04:44.550 If you drive around Vancouver, you see a lot 00:04:44.550 --> 00:04:47.769 of land. There's just a lot of space and you're 00:04:47.769 --> 00:04:49.230 seeing a lot of development there. You're seeing 00:04:49.230 --> 00:04:52.470 people subdivide larger lots to build single 00:04:52.470 --> 00:04:54.310 -family homes. So you're seeing a lot of new 00:04:54.310 --> 00:04:56.930 construction in that way. Along with that new 00:04:56.930 --> 00:04:59.209 construction, typically you're going to see a 00:04:59.209 --> 00:05:01.610 lot of commercial construction. So you've seen 00:05:01.610 --> 00:05:04.750 that in Ridgefield with the Costco, and you can 00:05:04.750 --> 00:05:09.290 see commercial builders building shopping complexes, 00:05:09.610 --> 00:05:13.829 light industrial spaces, small factories. And 00:05:13.829 --> 00:05:16.629 so you're really seeing a lot of growth in this 00:05:16.629 --> 00:05:19.310 area. And that is good for an investor because 00:05:19.310 --> 00:05:21.589 again, it indicates that people are invested 00:05:21.589 --> 00:05:25.490 in the community. They see where the puck is 00:05:25.490 --> 00:05:28.170 headed and they're putting their money where 00:05:28.170 --> 00:05:31.949 their mouth is, I guess. And so when you see 00:05:31.949 --> 00:05:36.050 those signs, you know that the rental market 00:05:36.050 --> 00:05:38.889 is going to be strong and appreciating. So the 00:05:38.889 --> 00:05:41.129 rental market, rental growth this year is about 00:05:41.129 --> 00:05:47.100 1 .3%. Since COVID, it's gone up about 5 .3%, 00:05:47.100 --> 00:05:50.300 which is over the median national rent increase 00:05:50.300 --> 00:05:54.000 number of something that's like 3 .3%. And I 00:05:54.000 --> 00:05:57.720 don't plan on this level of increase all the 00:05:57.720 --> 00:06:01.860 time, but I think it's safe to project rental 00:06:01.860 --> 00:06:06.529 income. sorry, rental rates continuing to increase. 00:06:06.689 --> 00:06:08.470 And they just increase because of inflation, 00:06:08.610 --> 00:06:11.290 but I'm looking for sort of asymmetrical increase. 00:06:11.529 --> 00:06:13.430 And I think with that, again, that population 00:06:13.430 --> 00:06:16.949 growth, you're going to see more demand for rentals, 00:06:17.129 --> 00:06:19.910 which increases the demand in rent and the price 00:06:19.910 --> 00:06:23.050 that you can command for rent. So overall, I'm 00:06:23.050 --> 00:06:25.550 super bullish on Vancouver. I have been for quite 00:06:25.550 --> 00:06:29.310 a while and I'm seeing that happening with East 00:06:29.310 --> 00:06:32.350 Side Waterfront development, large residential 00:06:32.350 --> 00:06:36.189 developments in East Vancouver, Camas, Ridgefield, 00:06:36.930 --> 00:06:39.209 you know, a lot of the Barberton area, you're 00:06:39.209 --> 00:06:41.930 seeing a lot of new construction. And so overall, 00:06:42.129 --> 00:06:44.490 I'm just incredibly bullish about the rental 00:06:44.490 --> 00:06:47.410 market here. So I think it's a great place to 00:06:47.410 --> 00:06:52.290 be. And given that the sub market has been so 00:06:52.290 --> 00:06:56.509 strong, I think that it's a great time for investors 00:06:56.509 --> 00:06:59.889 to jump in, even with the current rate environment. 00:07:00.240 --> 00:07:02.779 So we're going to go over some strategies to 00:07:02.779 --> 00:07:04.980 sort out what might be the best for you. What 00:07:04.980 --> 00:07:06.939 options are there? Because there's just a lot. 00:07:06.959 --> 00:07:08.639 And there's probably some that I'm not going 00:07:08.639 --> 00:07:11.879 to mention, but this podcast is for the novice 00:07:11.879 --> 00:07:14.019 investor who's looking to jump in, looking to 00:07:14.019 --> 00:07:17.220 get some general clarity on sort of what some 00:07:17.220 --> 00:07:20.319 investment strategies are. You know, my investment 00:07:20.319 --> 00:07:24.110 journey is continuing to develop and evolve over 00:07:24.110 --> 00:07:26.170 time. Like I mentioned, I used to chase a lot 00:07:26.170 --> 00:07:28.910 of cash flow and now I'm much more interested 00:07:28.910 --> 00:07:33.009 in appreciation and rental appreciation and just 00:07:33.009 --> 00:07:35.769 the equity in the home. So just targeting some 00:07:35.769 --> 00:07:38.930 better environments and paying more for them. 00:07:39.730 --> 00:07:42.550 Because I have that experience where I know that 00:07:42.550 --> 00:07:44.889 like, you know, and get what you pay for. And, 00:07:45.110 --> 00:07:46.610 you know, you can hear all these success stories 00:07:46.610 --> 00:07:49.269 and people, people are successful chasing cashflow 00:07:49.269 --> 00:07:52.029 and buying in those neighborhoods, those C minus, 00:07:52.029 --> 00:07:54.829 you know, maybe even a D plus neighborhood and 00:07:54.829 --> 00:07:58.480 they do very well. So thing to remember is. You 00:07:58.480 --> 00:08:00.899 know, it's also what your skill set is. Are you 00:08:00.899 --> 00:08:03.819 handy? Are you a contractor? Do you have that 00:08:03.819 --> 00:08:06.480 kind of experience? Are you good with numbers? 00:08:06.699 --> 00:08:09.360 Do you want to manage yourself? Do you want to 00:08:09.360 --> 00:08:11.879 use a property management company? How much do 00:08:11.879 --> 00:08:15.139 you want to be involved in real estate investing 00:08:15.139 --> 00:08:20.040 and in what regard? So some strategies out there 00:08:20.040 --> 00:08:22.459 that are working. I don't have these ranked, 00:08:22.480 --> 00:08:25.560 but I'm going to just bring them up. I kind of 00:08:25.560 --> 00:08:27.319 have a list of them. I'm going to start with 00:08:27.319 --> 00:08:30.600 short term rentals. And this has been something 00:08:30.600 --> 00:08:33.659 I've looked into and you just hear the stories, 00:08:33.840 --> 00:08:37.240 the Airbnb, the Verbo short term rentals, you 00:08:37.240 --> 00:08:39.320 know, you're just raking in the money every month. 00:08:39.480 --> 00:08:42.019 It's great. It's, you know, it's, it's changed 00:08:42.019 --> 00:08:44.480 quite a bit. And I think when Airbnb and Verbo 00:08:44.480 --> 00:08:46.720 first started, it was a lot easier to just kind 00:08:46.720 --> 00:08:49.419 of jump in. you know, expectations were lower. 00:08:49.639 --> 00:08:52.480 You could kind of do it haphazardly and have 00:08:52.480 --> 00:08:54.360 it work out for you. And I think that landscape 00:08:54.360 --> 00:08:56.360 has changed quite a bit because it's just been 00:08:56.360 --> 00:08:59.799 more competitive. There's more niches. People 00:08:59.799 --> 00:09:02.360 are just pickier about where they're staying. 00:09:02.679 --> 00:09:05.100 And so, and not to mention the regulations. So 00:09:05.100 --> 00:09:07.179 a lot of cities are just clamping down on short 00:09:07.179 --> 00:09:09.279 -term rentals. There's a lot of sentiment that 00:09:09.279 --> 00:09:11.200 is anti -short -term rental because it's taking 00:09:11.200 --> 00:09:15.039 up. housing to use as basically a hotel for people 00:09:15.039 --> 00:09:17.500 that are out of town or they're not really residents. 00:09:17.799 --> 00:09:20.419 And so there's been kind of an anti short -term 00:09:20.419 --> 00:09:24.279 rental backlash recently. And so it's just, I 00:09:24.279 --> 00:09:26.559 think, a lot harder. And the thing that you're 00:09:26.559 --> 00:09:28.759 getting into with short -term rentals, because 00:09:28.759 --> 00:09:31.980 it's nothing about it is passive. And if it is, 00:09:31.980 --> 00:09:35.120 you're paying for it. So you're basically in 00:09:35.120 --> 00:09:37.889 the hospitality business. If you're doing short 00:09:37.889 --> 00:09:40.990 -term rentals, so you are taking care of customers 00:09:40.990 --> 00:09:44.730 who are staying at your place. And so, you know, 00:09:44.750 --> 00:09:46.929 there's a lot involved with that. There's communication 00:09:46.929 --> 00:09:49.549 back and forth on whatever platform you're using. 00:09:49.889 --> 00:09:52.230 You're handling the reviews, you're changing 00:09:52.230 --> 00:09:56.169 towels, you're cleaning your, and you can do, 00:09:56.230 --> 00:09:58.950 you can be as active or as passive in that process 00:09:58.950 --> 00:10:01.309 as you want, but you're going to have to pay 00:10:01.309 --> 00:10:03.190 for that. So if you're paying for a company to 00:10:03.190 --> 00:10:06.129 come in and do that turnover with clients. You 00:10:06.129 --> 00:10:09.330 know, you're looking at 35 % of what you're charging 00:10:09.330 --> 00:10:12.350 is going to that service. It's that high. I've 00:10:12.350 --> 00:10:14.149 looked into it because I'm like short -term rental. 00:10:14.429 --> 00:10:16.870 I fell for it too, or I was interested in it 00:10:16.870 --> 00:10:19.610 because I wanted to see if I could squeeze more 00:10:19.610 --> 00:10:22.529 juice. What I found was at the end of the day, 00:10:22.690 --> 00:10:25.610 if you're not willing to do it, it's going to 00:10:25.610 --> 00:10:28.129 really cut into your profit margin. And it is 00:10:28.129 --> 00:10:30.350 a business that you have to run and it's not 00:10:30.350 --> 00:10:33.659 passive. You know, really none of this is passive. 00:10:33.879 --> 00:10:35.860 You got to keep your eyes on it. You got to pay 00:10:35.860 --> 00:10:37.519 attention to what's going on. But short -term 00:10:37.519 --> 00:10:40.399 rentals are to me are the least passive. And 00:10:40.399 --> 00:10:42.299 if you throw in that expense of having somebody 00:10:42.299 --> 00:10:44.019 manage your short -term rental, because they're 00:10:44.019 --> 00:10:45.879 doing quite a lot. And especially, you know, 00:10:45.879 --> 00:10:47.620 if they're handling everything, all the booking, 00:10:48.480 --> 00:10:50.639 all the communication, that's a real hassle. 00:10:50.759 --> 00:10:53.639 And so if you're not doing it, you're paying 00:10:53.639 --> 00:10:55.500 quite a bit for somebody to do it. So you're 00:10:55.500 --> 00:10:57.340 either paying with time or you're paying with 00:10:57.340 --> 00:11:00.940 money. And so short -term rentals, And for Vancouver, 00:11:01.379 --> 00:11:04.320 not a super short -term rental destination. I've 00:11:04.320 --> 00:11:08.600 seen short -term rental prices here and there's 00:11:08.600 --> 00:11:11.500 not a lot of people coming to Vancouver for a 00:11:11.500 --> 00:11:15.340 vacation. I love Vancouver and I think it's great. 00:11:15.399 --> 00:11:17.600 It's a great place to live. Not sure if it's 00:11:17.600 --> 00:11:21.639 high on people's destination list. unless they're 00:11:21.639 --> 00:11:23.340 into volcanoes or something, they want to see 00:11:23.340 --> 00:11:25.059 Mount St. Helens, or they want to use it as a 00:11:25.059 --> 00:11:26.860 base for getting out and hiking and fishing, 00:11:27.120 --> 00:11:30.179 I can see certain places, certain cabins that 00:11:30.179 --> 00:11:32.879 are maybe in a more rural area that have access 00:11:32.879 --> 00:11:36.139 to that recreation, or some lake homes and stuff 00:11:36.139 --> 00:11:39.259 like Lake Merwin. You have to have a destination. 00:11:39.580 --> 00:11:41.620 And so if you're in Vancouver proper, just somewhere 00:11:41.620 --> 00:11:45.700 in Clark County, there's just not a lot of consistent 00:11:45.700 --> 00:11:47.899 demand, I think. And you know what, if I'm wrong? 00:11:48.360 --> 00:11:50.820 Drop something in the comments. Let me know because 00:11:50.820 --> 00:11:53.120 I'd like to be proven wrong and if you have a 00:11:53.120 --> 00:11:54.940 great story about your short -term rental Hey, 00:11:54.980 --> 00:11:56.299 let me know about it. Maybe you can be on the 00:11:56.299 --> 00:11:58.620 show I'd love to have you on but in my experience 00:11:58.620 --> 00:12:00.779 is just what I've seen the prices are kind of 00:12:00.779 --> 00:12:03.960 lower There's we don't have like a college team 00:12:03.960 --> 00:12:05.600 here You know, some people will come all the 00:12:05.600 --> 00:12:08.100 way to see the big, you know a college football 00:12:08.100 --> 00:12:10.840 game or maybe they it's a destination for weddings 00:12:10.840 --> 00:12:13.659 and so have you know There's just a lot of short 00:12:13.659 --> 00:12:15.600 -term rentals are themes and you have to have 00:12:15.600 --> 00:12:18.039 a certain niche and I'm not I'm not really seeing 00:12:18.039 --> 00:12:22.340 that as much in Vancouver. So this option would 00:12:22.340 --> 00:12:24.879 require a lot of effort and potentially a lot 00:12:24.879 --> 00:12:27.419 of money for somebody to manage. And I don't 00:12:27.419 --> 00:12:29.779 know if the returns are going to be worth it. 00:12:29.919 --> 00:12:32.460 You have medium term rentals. And actually I 00:12:32.460 --> 00:12:34.799 am looking into this myself, medium term rentals. 00:12:35.000 --> 00:12:38.500 So that's a minimum 30 day stays. You can use 00:12:38.500 --> 00:12:41.320 platforms like furnished finder to post your 00:12:41.320 --> 00:12:43.639 home. I always recommend professional photos. 00:12:43.820 --> 00:12:46.779 And that's for people who are looking for quasi 00:12:47.379 --> 00:12:49.399 permanent, but temporary residents. You know, 00:12:49.500 --> 00:12:51.379 maybe it could be for a job. So like traveling 00:12:51.379 --> 00:12:54.600 nurses or doctors could be people looking to 00:12:54.600 --> 00:12:56.559 relocate that are just looking for a few months 00:12:56.559 --> 00:12:58.139 here and there until they decide what they're 00:12:58.139 --> 00:13:00.320 doing. They have some reason that they're here 00:13:00.320 --> 00:13:03.940 for 30 days, you know, maybe six months, maybe, 00:13:04.200 --> 00:13:06.379 but for a shorter amount of time, but not a short 00:13:06.379 --> 00:13:08.100 -term rental where it's turning over every couple 00:13:08.100 --> 00:13:11.549 of days. So I do like this because I do think 00:13:11.549 --> 00:13:14.509 people come to Vancouver. There are some traveling 00:13:14.509 --> 00:13:18.029 nurses. There's also some people's homes are 00:13:18.029 --> 00:13:20.950 damaged for some reason or flood or fire or something. 00:13:21.190 --> 00:13:23.590 They might need a semi -permanent place to stay. 00:13:23.990 --> 00:13:27.070 So I am interested in medium -term rentals in 00:13:27.070 --> 00:13:30.549 Vancouver. And I do think there's a demand. I 00:13:30.549 --> 00:13:33.350 haven't looked into it enough to really claim 00:13:33.350 --> 00:13:37.350 to be an expert, but I'm seeing the rental prices 00:13:37.350 --> 00:13:41.340 being maybe about 500 to 1 ,000 more than long 00:13:41.340 --> 00:13:45.200 -term rental prices for these medium -term rentals. 00:13:45.460 --> 00:13:47.740 You do have to furnish them and so similar to 00:13:47.740 --> 00:13:50.759 short -term rentals, there is an expense of getting 00:13:50.759 --> 00:13:53.559 them furnished nicely, having all the amenities 00:13:53.559 --> 00:13:56.580 there, and really setting yourself apart from 00:13:56.580 --> 00:13:59.240 the competition because that is part of it too. 00:13:59.460 --> 00:14:02.159 It's still kind of a hospitality, but the turnover 00:14:02.159 --> 00:14:04.320 is less and I really like that because it wouldn't 00:14:04.320 --> 00:14:06.629 be... so hard to turn over after a month. You 00:14:06.629 --> 00:14:09.070 could come in and clean it yourself and replace 00:14:09.070 --> 00:14:11.750 the soap and the towels and straighten up and 00:14:11.750 --> 00:14:13.870 everything. So I do like this option because 00:14:13.870 --> 00:14:15.990 I do think it could raise the amount of rent 00:14:15.990 --> 00:14:18.690 you're able to get. Again, if it's sitting though, 00:14:18.710 --> 00:14:20.629 like if it sits for a month or it's just not 00:14:20.629 --> 00:14:23.429 being rented for whatever reason, you know, that's 00:14:23.429 --> 00:14:26.129 a consideration that vacancies eating into your 00:14:26.129 --> 00:14:28.330 profit margin. So I like it better than short 00:14:28.330 --> 00:14:30.970 term, but it's still a little bit risky and something 00:14:30.970 --> 00:14:33.149 I'm looking into, but not something I've done 00:14:33.149 --> 00:14:35.779 yet. So we had short -term and medium -term rentals. 00:14:35.919 --> 00:14:37.919 Next on my list is just going to be your straight 00:14:37.919 --> 00:14:41.120 up long -term rental. And this is, you know, 00:14:41.299 --> 00:14:44.500 this is a tried and true method. So you get somebody 00:14:44.500 --> 00:14:46.860 on a year lease and then maybe a month to month 00:14:46.860 --> 00:14:48.399 and they're staying there and they're paying 00:14:48.399 --> 00:14:50.700 you rent every month. Ideally, it's what you 00:14:50.700 --> 00:14:52.399 think of when you think of a rental property, 00:14:52.460 --> 00:14:55.500 like a long -term rental. The thing with long 00:14:55.500 --> 00:14:58.419 -term rental properties, it's hard to cashflow 00:14:58.419 --> 00:15:00.980 with them in Vancouver unless you're putting 00:15:00.980 --> 00:15:05.149 a large amount down. And so, and even then, if 00:15:05.149 --> 00:15:07.049 you're putting, you know, a lot of lenders require 00:15:07.049 --> 00:15:09.950 25 % down on an investment property, it's quite 00:15:09.950 --> 00:15:13.929 a big chunk of cash that you might, you're not 00:15:13.929 --> 00:15:16.269 going to be able to get back very easily. So 00:15:16.269 --> 00:15:18.929 a lot of times a consideration is you're going 00:15:18.929 --> 00:15:21.289 to put in this capital and you're not going to 00:15:21.289 --> 00:15:24.529 get it back immediately. And so I like to put 00:15:24.529 --> 00:15:27.629 in the least amount of capital possible. and 00:15:27.629 --> 00:15:30.870 then leverage the rest via a loan. That is hard 00:15:30.870 --> 00:15:32.309 to do with rental properties because if you're 00:15:32.309 --> 00:15:35.710 doing a straight buy on a rental, it's usually 00:15:35.710 --> 00:15:40.070 25 % unless you're doing some kind of seller 00:15:40.070 --> 00:15:43.149 finance deal and that's kind of hard to come 00:15:43.149 --> 00:15:45.250 by. It's not impossible. I haven't done it yet, 00:15:45.269 --> 00:15:47.590 but I've definitely reached out to several listings 00:15:47.590 --> 00:15:49.769 I've seen. I've just asked the listing agent, 00:15:50.090 --> 00:15:52.190 is the seller willing to do seller financing? 00:15:52.769 --> 00:15:55.850 And a lot of times you get a no answer, but it's 00:15:55.850 --> 00:15:57.929 always something to ask. If you're an investor 00:15:57.929 --> 00:15:59.850 looking to pick up a home, like you might be 00:15:59.850 --> 00:16:02.950 able to put less down and negotiate an interest 00:16:02.950 --> 00:16:05.870 rate that is lower than what's being offered. 00:16:06.049 --> 00:16:08.470 It's just sort of the holy grail of investing 00:16:08.470 --> 00:16:11.210 is finding that seller financing. And I actually 00:16:11.210 --> 00:16:15.169 have ran into it on a duplex and I passed on 00:16:15.169 --> 00:16:18.549 it, but I am kind of like kicking myself a little 00:16:18.549 --> 00:16:21.769 bit because it was a seller finance deal at a 00:16:21.769 --> 00:16:25.559 very reasonable rate. They just wanted more money 00:16:25.559 --> 00:16:27.879 than I was willing to sink into it because I 00:16:27.879 --> 00:16:30.799 knew I wasn't going to get that back. And I had 00:16:30.799 --> 00:16:35.000 some other options. I do think about that from 00:16:35.000 --> 00:16:37.279 time to time. Like, wow, I had this seller finance 00:16:37.279 --> 00:16:39.919 deal and I didn't take advantage of it. So they 00:16:39.919 --> 00:16:42.779 do come along. But with long term rentals, even 00:16:42.779 --> 00:16:46.700 with that 25 % down, you're lucky to break even 00:16:46.700 --> 00:16:49.039 when you account for the principal interest taxes 00:16:49.039 --> 00:16:52.620 and insurance. It's really hard to make long 00:16:52.620 --> 00:16:55.379 -term rentals cash flow, just buying standard 00:16:55.379 --> 00:16:59.379 homes at the 25%. Not saying it's impossible. 00:17:00.639 --> 00:17:03.480 Breakeven's definitely possible, depending on 00:17:03.480 --> 00:17:06.799 the terms. And again, if you put 50 % down, yeah, 00:17:06.799 --> 00:17:09.779 you can cash flow on it, but then it requires 00:17:09.779 --> 00:17:12.759 quite a bit of capital. And so a lot of people 00:17:12.759 --> 00:17:15.339 don't have that capital, or a lot of investors 00:17:15.339 --> 00:17:18.140 I know, including myself, don't want to throw 00:17:18.140 --> 00:17:19.480 in a bunch of capital that they're not going 00:17:19.480 --> 00:17:21.119 to see back because then it just sits there. 00:17:21.400 --> 00:17:24.140 And so long -term rentals are great, and they 00:17:24.140 --> 00:17:26.720 were better a few years ago when interest rates 00:17:26.720 --> 00:17:31.519 were lower. So a tried and true classic, but 00:17:31.519 --> 00:17:35.660 just be aware that you might not cash flow, so 00:17:35.660 --> 00:17:39.839 you're going to be looking for more rental appreciation 00:17:39.839 --> 00:17:43.859 and equity appreciation. Next up I have fix and 00:17:43.859 --> 00:17:46.940 flips now fix and flips are definitely sort of 00:17:46.940 --> 00:17:50.319 what's making money right now because you're 00:17:50.319 --> 00:17:54.119 able to get all your capital back and more obviously 00:17:54.119 --> 00:17:56.519 you're doing the math on that but because you're 00:17:56.519 --> 00:17:59.579 not trying to refinance or you're just selling 00:17:59.579 --> 00:18:02.420 you're able to get all your capital back and 00:18:02.420 --> 00:18:04.950 the idea is you make money on it so you get more 00:18:04.950 --> 00:18:08.390 on your capital. So you're buying a home using 00:18:08.390 --> 00:18:12.309 typically a hard money loan, sort of alternate 00:18:12.309 --> 00:18:15.130 bank route, if you will. The interest rates are 00:18:15.130 --> 00:18:20.109 higher. There's certain financial requirements 00:18:20.109 --> 00:18:22.970 that you have to fulfill. These are sort of like 00:18:23.860 --> 00:18:26.400 companies that they're not exactly banks. They're 00:18:26.400 --> 00:18:28.559 designed to loan money out for these kind of 00:18:28.559 --> 00:18:30.480 projects and they make money on the interest. 00:18:30.660 --> 00:18:34.259 And then if you default, then they take the property. 00:18:35.599 --> 00:18:39.420 And so you're still financing it and you're still 00:18:39.420 --> 00:18:42.460 required to put some down. If you have more experience, 00:18:42.700 --> 00:18:47.079 you could do zero down, fix and flips. But if 00:18:47.079 --> 00:18:49.420 you're not an experienced investor, expect to 00:18:49.420 --> 00:18:53.690 put down anywhere from 10 to 20%. And then you're 00:18:53.690 --> 00:18:56.230 going to be paying a higher interest rate during 00:18:56.230 --> 00:18:59.170 the time that your project is going on. So while 00:18:59.170 --> 00:19:00.890 you're doing the renovations, you're going to 00:19:00.890 --> 00:19:03.130 be paying interest on that. You're going to be 00:19:03.130 --> 00:19:06.009 paying a higher loan fee. So the fees can be 00:19:06.009 --> 00:19:08.769 pretty high using hard money to do a fix and 00:19:08.769 --> 00:19:11.630 flip. And you have to really have a lot of experience 00:19:11.630 --> 00:19:15.309 being able to estimate repair costs, having the 00:19:15.309 --> 00:19:20.410 ability to bring in vendors that are going to 00:19:20.410 --> 00:19:23.819 cost effectively. be able to rehab your property 00:19:23.819 --> 00:19:27.240 so you can make money because these flips can 00:19:27.240 --> 00:19:29.680 they're pretty risky and you could easily lose 00:19:29.680 --> 00:19:31.980 money on them if you don't know what you're doing 00:19:31.980 --> 00:19:35.519 and there's a learning curve and so while this 00:19:35.519 --> 00:19:38.460 is working for people right now there's a pretty 00:19:38.460 --> 00:19:41.099 high level of risk to it especially when we have 00:19:41.099 --> 00:19:43.420 these kind of dips in the market so i've seen 00:19:43.420 --> 00:19:47.160 plenty of like abandoned flips or you know, flips 00:19:47.160 --> 00:19:49.180 where it's halfway done because they ran out 00:19:49.180 --> 00:19:50.880 of money and they just were like, we need to 00:19:50.880 --> 00:19:52.480 get back something. And so we're going to put 00:19:52.480 --> 00:19:54.680 it on the market, which is really unfortunate, 00:19:54.980 --> 00:19:59.259 but it is what's making money right now for more 00:19:59.259 --> 00:20:02.039 experienced investors. There is a strategy where 00:20:02.039 --> 00:20:04.079 you kind of do the same thing. You can use hard 00:20:04.079 --> 00:20:06.119 money to buy a property. It's called the BRR 00:20:06.119 --> 00:20:10.700 method. It's buy, renovate, refinance, and repeat. 00:20:11.039 --> 00:20:13.920 And so that's basically where you're buying a 00:20:13.920 --> 00:20:16.539 distressed property, repairing it, putting somebody 00:20:16.539 --> 00:20:18.740 in it. There's a seasoning period of usually 00:20:18.740 --> 00:20:21.619 12 months, and then you're able to refinance 00:20:21.619 --> 00:20:23.559 out. So that gets your money back and you're 00:20:23.559 --> 00:20:25.819 able to keep the property right now. These are 00:20:25.819 --> 00:20:28.740 really hard to make the math work on. And so 00:20:28.740 --> 00:20:30.680 you're not seeing them as much. You saw them 00:20:30.680 --> 00:20:33.180 a lot more when the interest rates were lower. 00:20:33.539 --> 00:20:36.880 So. I don't see these very much. Again, if you're 00:20:36.880 --> 00:20:39.160 doing them, I want to hear about it. Let me know. 00:20:39.180 --> 00:20:41.019 Let me know in the comments. Come on the show. 00:20:41.180 --> 00:20:43.559 I want to hear about your experience and I think 00:20:43.559 --> 00:20:45.720 other people would too, but I'm seeing more of 00:20:45.720 --> 00:20:47.579 the fix and flips right now because you're able 00:20:47.579 --> 00:20:49.920 to get all of your money back. You know, we're 00:20:49.920 --> 00:20:52.279 in that burr. You have to keep some money in 00:20:52.279 --> 00:20:54.940 the deal and hopefully you get that money back 00:20:54.940 --> 00:20:57.200 so you can reuse that money, but you're not really 00:20:57.369 --> 00:20:59.769 making more money on top of it. You're just, 00:20:59.769 --> 00:21:01.549 you're getting a property that you own, which 00:21:01.549 --> 00:21:03.829 is great. And I would, I would choose that over 00:21:03.829 --> 00:21:05.930 a fix and flip because with the fix and flips, 00:21:06.170 --> 00:21:07.890 you got to pay taxes. You're in a, you're in 00:21:07.890 --> 00:21:09.990 a business on that too. Like you're working really 00:21:09.990 --> 00:21:12.230 hard. If you're involved in the flip at all, 00:21:12.329 --> 00:21:15.130 you're managing it. There's all the risk. So 00:21:15.130 --> 00:21:17.630 it sounds sexy and there's people that do it 00:21:17.630 --> 00:21:20.019 well and people that make a lot of money. you're 00:21:20.019 --> 00:21:22.400 paying short term capital gains and whatever 00:21:22.400 --> 00:21:25.339 else taxes. So you're losing sort of that tax 00:21:25.339 --> 00:21:27.799 advantage of owning real estate and it's a job. 00:21:28.059 --> 00:21:30.359 So then you got to find the next flip and you're 00:21:30.359 --> 00:21:33.500 doing that. So ideally you'd be doing the fix 00:21:33.500 --> 00:21:35.359 and flip and then taking some of that profit 00:21:35.359 --> 00:21:38.960 and putting it into a buy and hold rental property. 00:21:39.299 --> 00:21:41.259 But yeah, you're paying a lot in taxes and you're 00:21:41.259 --> 00:21:42.759 taking a lot of risk with the fix and flips, 00:21:43.019 --> 00:21:46.369 but it is working. Next on my list and I'm gonna 00:21:46.369 --> 00:21:49.609 these are the top real estate investment methods 00:21:49.609 --> 00:21:53.009 I think are working right now and that I have 00:21:53.009 --> 00:21:56.490 done myself and have recommended to people who 00:21:56.490 --> 00:21:59.470 either they're Usually these people are of an 00:21:59.470 --> 00:22:02.809 investment mindset So they are feed the first 00:22:02.809 --> 00:22:05.849 -time home buyers or people looking to buy another 00:22:05.849 --> 00:22:09.190 home But the method that I think is the best 00:22:09.190 --> 00:22:13.430 right now is the live -in flip. So this is where 00:22:13.599 --> 00:22:17.019 and also a house hack. So very kind of similar, 00:22:17.220 --> 00:22:19.359 but a little bit different. So I'll bring in, 00:22:19.500 --> 00:22:21.160 I'll actually bring in the house hack first. 00:22:21.299 --> 00:22:24.140 And the house hack is typically a buying a duplex 00:22:24.140 --> 00:22:27.940 or a fourplex and you are living in one of the 00:22:27.940 --> 00:22:30.539 units and renting the other unit out. And that 00:22:30.539 --> 00:22:33.640 sort of offsets your, uh, the amount of mortgage 00:22:33.640 --> 00:22:36.480 you pay every month. And these can work very 00:22:36.480 --> 00:22:38.599 well. A lot of times you still have to have a 00:22:38.599 --> 00:22:40.900 pretty sizable down payment. The down payment 00:22:40.900 --> 00:22:43.180 requirements have gone down, but some lenders 00:22:43.180 --> 00:22:45.480 will still, you know, it depends on the lender. 00:22:45.700 --> 00:22:48.539 Some will count the potential rent towards your 00:22:48.539 --> 00:22:50.900 qualification and then others may be less so, 00:22:51.039 --> 00:22:54.119 but the requirements for down payments have gotten 00:22:54.119 --> 00:22:58.599 less over the last year or two. And so it's really 00:22:58.599 --> 00:23:01.079 a great option for someone who might be a first 00:23:01.079 --> 00:23:03.160 time home buyer. They're looking to just get 00:23:03.160 --> 00:23:05.700 into an investment property and you know, they're 00:23:05.700 --> 00:23:08.579 okay with living in one unit and renting out 00:23:08.579 --> 00:23:10.420 the others. I mean, you can do this with a single 00:23:10.420 --> 00:23:13.000 family home too, but you typically tend to see 00:23:13.000 --> 00:23:15.779 it more with like a duplex or a home with an 00:23:15.779 --> 00:23:19.720 ADU or something like that. But it is a great 00:23:19.720 --> 00:23:22.329 idea because All that money that you're saving 00:23:22.329 --> 00:23:24.650 on the mortgage, ideally you can, you know, you're 00:23:24.650 --> 00:23:26.769 saving that, you can make that money work for 00:23:26.769 --> 00:23:29.089 you. And sometime in the future, you can buy 00:23:29.089 --> 00:23:32.470 another property to either rent or live in, and 00:23:32.470 --> 00:23:35.130 then keep that duplex that you purchased. And 00:23:35.130 --> 00:23:37.230 then that kind of builds your rental portfolio 00:23:37.230 --> 00:23:39.769 over time. So I think that's a great option because 00:23:39.769 --> 00:23:42.849 you get primary residence interest rates, which 00:23:42.849 --> 00:23:45.289 are lower than the investor real estate rates 00:23:45.289 --> 00:23:48.329 typically. So you get access to cheaper money. 00:23:48.899 --> 00:23:52.140 And then you get reduced mortgage payments. Cause 00:23:52.140 --> 00:23:54.059 again, you have that person paying it for you 00:23:54.059 --> 00:23:56.480 at your renter. I think that's a great option. 00:23:56.539 --> 00:23:59.000 I would be looking to do that if I was younger. 00:23:59.380 --> 00:24:02.240 I've thought of doing it, even dragging my family 00:24:02.240 --> 00:24:04.759 into it. They're less enthused about living in 00:24:04.759 --> 00:24:07.480 a duplex right now, but it is an option. So I 00:24:07.480 --> 00:24:09.839 do like house hacking and related to house hacking. 00:24:09.960 --> 00:24:12.380 And I think this is a really great idea is the 00:24:12.380 --> 00:24:16.680 live in flip. So this is where you buy a home 00:24:16.680 --> 00:24:19.940 that has some cosmetic upgrades that you can 00:24:19.940 --> 00:24:23.000 make. So basically like a granny gold, granny 00:24:23.000 --> 00:24:26.140 special, you know, orange shag carpet, paint 00:24:26.140 --> 00:24:28.920 countertops, you know, stuff like that, where 00:24:28.920 --> 00:24:31.400 it's just a matter of ripping that stuff out, 00:24:31.740 --> 00:24:34.700 replacing it with new flooring, redoing the bathroom, 00:24:35.160 --> 00:24:37.380 you know, making those improvements to force 00:24:37.380 --> 00:24:40.039 equity into it. And then you could either, you 00:24:40.039 --> 00:24:42.779 know, ideally you could possibly refinance to 00:24:42.779 --> 00:24:46.980 get your money back or to get better terms. Or 00:24:46.980 --> 00:24:49.819 again, if you're saving, you could use it to 00:24:49.819 --> 00:24:52.319 buy another rental property or you can sell it 00:24:52.319 --> 00:24:55.579 and then take that money and buy another live 00:24:55.579 --> 00:24:58.259 -in flip. And then you get that profit tax -free 00:24:58.259 --> 00:25:01.319 because it was your primary residence. And so 00:25:01.319 --> 00:25:03.500 I think it's just being a little more strategic 00:25:03.500 --> 00:25:06.940 about. What home you buy and looking at the investment 00:25:06.940 --> 00:25:09.779 potential and forcing that equity? But the great 00:25:09.779 --> 00:25:11.799 thing about live and flip is that you have a 00:25:11.799 --> 00:25:14.819 place to live. It's not your forever home It's 00:25:14.819 --> 00:25:17.440 not your dream home because it's got you know, 00:25:17.579 --> 00:25:20.200 stinky carpet But the idea is you're getting 00:25:20.200 --> 00:25:22.559 the lower interest rate because it's your primary 00:25:22.559 --> 00:25:25.279 you're able to move in you can flip you can do 00:25:25.279 --> 00:25:28.019 those renovations over time you can take advantage 00:25:28.019 --> 00:25:30.460 of more favorable interest rates in the future 00:25:30.460 --> 00:25:34.279 hopefully and then when you do sell You can take 00:25:34.279 --> 00:25:36.779 those gains tax free because it's your primary 00:25:36.779 --> 00:25:39.559 residence. So that technique is what I think 00:25:39.559 --> 00:25:42.240 is really good for people because, you know, 00:25:42.279 --> 00:25:43.960 and if you're able to, you can hold that property 00:25:43.960 --> 00:25:47.160 as well. So I think that's what's working right 00:25:47.160 --> 00:25:49.480 now. Again, very individual. People can make 00:25:49.480 --> 00:25:52.700 anything work, but deciding what your end goal 00:25:52.700 --> 00:25:56.019 is and deciding what your strengths are and the 00:25:56.019 --> 00:25:59.380 amount of risk you want to take. is all is super 00:25:59.380 --> 00:26:01.799 important. So I highly recommend that. I hope 00:26:01.799 --> 00:26:04.420 that today's show has convinced you that Vancouver 00:26:04.420 --> 00:26:07.500 is a fantastic place to invest and given you 00:26:07.500 --> 00:26:09.559 a little overview of some investment strategies 00:26:09.559 --> 00:26:11.819 that you can use in your real estate investing 00:26:11.819 --> 00:26:14.920 journey. If you're interested in investment properties 00:26:14.920 --> 00:26:18.599 in Vancouver, drop a comment or email me at doug 00:26:18.599 --> 00:26:21.299 at dougverinas .com. And let's just get a conversation 00:26:21.299 --> 00:26:23.680 started about how I can help you find that great 00:26:23.680 --> 00:26:27.039 investment property. Also, if you're an investor 00:26:27.039 --> 00:26:30.119 and you'd like to partner with me on some investments 00:26:30.119 --> 00:26:33.480 potentially, also drop a comment or email me 00:26:33.480 --> 00:26:36.539 doug at dougverinas .com. Hope this has been 00:26:36.539 --> 00:26:39.680 helpful. Please like and subscribe if it has 00:26:39.680 --> 00:26:41.680 been, and I'll see you next time. Take care, 00:26:41.779 --> 00:26:41.980 everybody.