Investment Property Mortgages in Calgary

At Spire, we walk, talk, eat and sleep investment Real Estate.  We believe, whole-heartedly - that Real Estate is our ticket off the treadmill.  Full stop. 

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If you’re looking to purchase investment Real Estate, you’ve really clicked on the right page.  Renée and her crew have been involved in the wild west of owning and managing investment Real Estate in Alberta for several years. 

Together, they currently own and manage 36 properties and pay 26 mortgages.  Yup – they have truly put their money where their mouths are.  (And yes, they are still working in mortgages, so they are well aware that this is a “get rich slow” plan).

When it comes to investment Real Estate, a lot of clients get hung up trying to figure out how to purchase 10 or 15 properties and forget that the best thing to do is just buy one.  Literally, “just do it.”  (thanks Nike for that idea).

Renée wrote a blog post a few years ago after she’d been at Story Book Theatre and was inspired by a Dr. Seuss production called “all the thinks you can think.”  It got her thinking about all the Real Estate Thinks her clients could think.  She says, “I think as a Mortgage Broker, the best part of my job is working with young buyers that have no “real estate thinks.”  I am in the super exciting position of inviting them to think a little bit BIGGER.

How exciting – to see the light bulb go off when we invite a 25 year old, first time home buyer, to consider that in 5 years – they can rent this property out and purchase another one!  

Maybe in 30 years, they will be mortgage free on 2 properties, and they only paid one mortgage!  How exciting – to speak to a recently divorced woman, with a settlement from her divorce, thinking of her bleak future alone, and invite her to consider all the incredible “real estate thinks” she could think about with her settlement.  What about a retired couple that wants to travel more – what thinks can they think?  Are they downsizing, thinking about a CHIP mortgage?  Would a suited property work better for them so that someone is in their home when they’re gone?  Or are these people just stuck, wishing and wanting for more.”

We would LOVE to speak with you about your Real Estate thinks! Or help you come up with the best ideas inSPIREd but your own story!

At Spire, we look at investment Real Estate as a path to spend more time with the people you love, doing the things that set your heart on fire.

 

Let’s look at an example:

▲ In 2022, you purchase a suited home, in Calgary, for $400,000.  To purchase this home, you need $20,000 and a house hold income of $70,000 ish (if there is a rentable suite)
▲ Your cost per month is about $2000 when you consider mortgage payments, property taxes and insurance. 
▲ You rent the suite for $1000 per month which means that you’re living for about $1000/month if you live upstairs. 
▲ 2 years later, after saving that $1000 per month, you have another $20,000 for a down payment.  You rent the upper suite for $1500.  This gives you $2500 a month to cover all the expenses of the property including the utilities. 
▲ Head out and look for another suited home!  After you purchase home number 2 (which is pretty easy because you’ve got great income from home number 1), you’ve got $3,500 out of $4000 per month needed to cover your fixed cost. 

▲ Fast forward 27 years - even if rents haven’t changed - you’ve got 2 properties that pay you $4000 per month! Combined with your other retirement plans - this can make for an amazing life in retirement! 

Investor Resources

Worried about leases?  Worried about tenant screening?  Worried about vacancies?  Having a hard time running numbers or finding strategies that work for you?  LEAN ON US – we’ve been there and we’ve made ALL the mistakes.

Spire’s Just Buy 3 Program is the perfect start for any Real Estate Investor. 

Should I Buy a Condo? Condo vs SFH

We are asked all the time if we think it is a good idea to purchase a condo or a single family home. Here is the truth, there is a time and a place for both, but generally, if you're able to stretch to that single family home number, you're able to put more money back in your pocket each month.

If you buy a house, you will be responsible for paying all expenses related to owning and maintaining your property, including the mortgage, property taxes, utilities, insurance, house and yard maintenance and any repairs or renovations. You'll want to have an emergency fund set aside for problems with things like the furnace or roof.

If you buy a condo, you will own the interior space of your unit and in some cases a parking space. Common areas and outdoor space will be owned in common with other owners in your building. You will pay a monthly condo/maintenance fee, which can cover items like heat, hydro, water, pest control, landscaping, building insurance and miscellaneous amenities. A portion of this fee will go into a reserve fund to cover major repairs and upgrades to the building, such as the roof or elevators. In most cases, you (and the other unit owners) will also have to pay a one-time special assessment for “emergency” repairs not covered by the condo fee.

In the example in the PDF, we'll explore a home purchase for a client with a total household income of $62,000 per year and no other debt. Here are the qualification numbers for both a single family home and a condo.

The key difference is that the mortgage paydown, or the "money back in your pocket" at the end of the year is much greater with the purchase of a single family home. That being said, it's important to make sure that you're taking good care of your asset, the home, and putting away a little bit of money each month in a contingency fund.

Connect with us to run the numbers and figure out what purchase options are best for your personal situation!

Real Estate vs Stock Market

We are all looking for ways to produce monthly income in retirement. Most of us invest in the stock market hoping for 5-10% annual returns. What if there was another option?

These scenarios in the PDF compare investing in the stock market and investing in real estate in both a rising and falling market. We assume a 25-year time frame.

Just Buy 3 Program

When I got into Real Estate, (15 years ago, yes, it was THAT long ago), it was about creating a secure investment that would withstand time. That would still provide income for me, during the the stock market runs AND the stock market crashes.

Buying the first property was scary. I am not going to lie to you. I had absolutely no idea what I was doing. Luckily enough, my Realtor was an investor himself and he assisted myself and my husband in creating our team of Real Estate Professionals. From day 1, everyone knew that our goal was to puchase 3 homes, and they were all on board with helping us get to where we wanted to be.

Why 3? We figured that if we bought 3 homes around $300,000, that eventually we would have close to $1M in assets. And let's remember, this is $1,000,000 in assets that SOMEONE ELSE is paying for. Sure sure, we had to come up with the down payments, but once we had that, the tenants were paying our mortgage payments.

Buying Real Estate was a tangible asset that I could control. If I ever needed to get out and regroup, I was in charge of when it was listed, of the curb appeal at listing, of pricing it appropriately to sell. There was no "fund manager " in my way, I was betting on myself to make the right choices.

As of 2019, average retirement nest egg is only $100,000. Honestly, that gives me anxiety. That is NOT enough to maintain the lifestyle that we want to live in Calgary. So the big question here is, how did we do it?

EASY. I am not even kidding. I was 24 years old when we bought our first suited home.

We lived in the basement and rented the upper floor. We banked everything we made from the rented suite and saved our pennies. We then bought the second property a year later and then the third one a year after that. We kept going with putting 5% down. We'd get the home up and running, stay a year, save, save, save, and then move on to a new home.

We get asked all the time is it possible to only put 5% down when buying your next home. The answer is YES as it is going to be your primary residence for a year or more while you build up your next downpayment.

You can choose to live upstairs. Rent the basement and rent the garage, just try to increase your monthly income where ever you can!

The vision is easy. The next step is making sure that you're purchasing the right property. We have been down this road several times - ask us what we think about your investment purchase!