Buying Investment Property: The Basics

Calgary Real Estate Investment Experts

If you're interested in buying or selling an investment property in Calgary, we offer a range of real estate investment services.  We advise our clients on investment opportunities, appropriate pricing strategies and market trends.  Our experienced team knows where the real estate market in Calgary has grown and where it hasn't, so we're in a good position to recommend the properties that have the best investment potential.

Of course, we look for properties that show the best return for you, the investor.  They have to be in good structural condition (good bones) and have amenities that tenants want.  We don't generally advise our clients to purchase properties that need total gut jobs or that need to be completely torn down and rebuilt; you have better things to do with your time!

Based on the type of property you own and its location, our team will help you focus your tenant search so you can find the most stable renters who will stay in your property the longest.  To help you attract great tenants, we'll provide recommendations for improvements and renovations that will increase your investment property's value and make it easier to rent for income, or sell at a profit.  Of course, we'll be happy to provide market advice and property evaluations for you on a regular basis, so you know how your investment is doing.

Photo by Kevin Saff
Photo by Kevin Saff

Tips for Investing in Real Estate

Once your own residence is taken care of and you have experienced the benefits of homeownership firsthand, the idea of owning another home as an investment might occur to you.  With a little knowledge on your side, now is an excellent time to invest in real estate.  Consider the following tips to help make your venture a success:

  • Identify your goals and determine whether you want to rent out the house until it's fully paid off, then enjoy a nice annual income from rents; or whether you are looking a more short-term profit.
  • Put financing in place that matches your goal; if you want to sell sooner rather than later, you might want to look into a shorter term adjustable mortgage with a very low temporary interest rate.  For longer-term real estate investments, fixed mortgages tend to be better because they allow you to plan your cash flow accordingly
  • Rather than paying off the mortgage as soon as you possibly can, consider using rental income to help subsidize the mortgage payment, if you're in it for the long haul
  • Make sure you are leveraging all of the tax benefits of depreciation and valid expenses – your accountant can help show you how
  • Make simple property improvements such as changing locks, putting in new plants or painting all by yourself, instead of hiring costly professionals
  • If possible, avoid hiring a rental agency that will take 10% to 15% plus the first month's rent in exchange for finding you a tenant; you can probably put the time in to place classified ads and answer your own phones
  • Do hire the appropriate professionals to help you make the investment; you might be able to paint the place by yourself, but you should not skimp when it comes to hiring competent real estate and legal help for the transaction
  • Become familiar with market trends – real estate investing is a highly competitive business and you should educate yourself on as many of the issues and trends as possible (though we will of course handle this legwork for you, it doesn't hurt to become knowledgeable about home prices, interest rates and communities on your own)
  • Practice prudence.  When renting, you are relying on rental income to subsidize a fair amount of your mortgage, but not the entire thing (unless the rental market will bear it).  Get rich quick schemes will likely lead you to trouble, so make sane, business-focused decisions.

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