$10k down? Just buy it!

One of the things I've always said to my kids is "if you can find a house for $10,000 down, just buy it".
I had a client wishing to sell and that was all the equity he had in the house so I told Bryce and Cole that they should buy the house and take over the mortgage.
It was a rent to own which I can explain to you if you're interested but basically they put down $10,000, assumed the sellers payments, rented it out, and made cash flow.

The funny part of this was that neither of the boys actually saw the house. They both just took my word for it and they got a great house with great terms at a great price!

Now, you should probably find a house that actually breaks even. That's the best way to do it but I would probably still buy a house with $10,000 down even if I had to subsidize it a bit because every month on that mortgage you're probably paying down $600 a month off in principle.
All you need is a $10,000 line of credit even if you don't have the cash.
Keep your eyes open for an opportunity and be prepared to shop!

#investing
#thinkingoutsidethebox

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Penny/Bryce Kander

Realty Executives Alberta Elite

403-896-7331

https://www.facebook.com/teamkander/

"It's too late to buy a house. I've missed my opportunity."

I hear this a lot from people but is it really true???
Years ago, I bought a piece of lakefront property at Sylvan lake for $169,000. I believe I borrowed the money at 14.5 %. That seems like an outrageous interest rate but at that time it was cheap because interest rates were as high as 22%!!

Now, that same property can be purchased for around
$1 million but you can borrow $1 million at 2.3%. It does cost more per month but it's not five times more because the interest rates are so cheap right now.
So...don't ever think that you've missed the boat. It's never too late.
There's always another boat. Grab an oar and let's get going!
#GeneralRealEstate
#StartToday
#NeverTooLate

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Penny/Bryce Kander

Realty Executives Alberta Elite

403-896-7331

https://www.facebook.com/teamkander/

Buy, Flip, with only a little $!

The other day, after one of my Real Estate coaching sessions with a young investor, I was thinking ...

I could probably make more money buying properties, if I had the owner carry the financing while I fix them up and flip them, than I could selling houses.
All you need is a little bit of cash and some chutzpa.

It gives sellers who are in a tough position the opportunity to sell their properties. All they have to do is carry the financing for a short amount of time so you can fix them up and flip them and sell them and make a profit. It's a win-win!
No full-time job needed!!

This makes it sound simple but it will only work if you have an agent who knows how to present the opportunity properly to the seller and also help you find a house that will actually work.
Send us a message or give us a call and we would love to help you get started.
#thatsus
#realestateinvesting


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Penny/Bryce Kander

Realty Executives Alberta Elite

403-896-7331

https://www.facebook.com/teamkander/

DON'T LET PEOPLE KILL YOUR DREAMS!

Don't let other people's fears keep you from achieving your goals.

Your dreams are personal to you. We often ask those close to us to weigh in on or get on board with our dreams but that rarely works. They can give opinions and counsel based on their experience or areas of expertise but we can't expect them to step inside of our dreams.

You need to see a clear picture of the desired outcome and then step forward confidently. When others give you counsel, consider it and then move forward either on a corrected course or stay the course in spite of it. Realize that pursuing your dream will come with obstacles and trials at times. That's why your dream must be worth it!

It isn't fair to ask others for permission or have them make decisions regarding your dreams. Put in that position they will generally say no to pursuing it as they don't want to be held responsible or be blamed if you experience setbacks or challenges following your dream.

So be brave! Follow your dreams! Don't let anything or anyone keep you from achieving a dream that is important to you!

If there's any way that we can help you achieve those dreams give us a call. We love seeing people's dreams come true.

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Penny/Bryce Kander

Realty Executives Red Deer

403-896-7331

https://www.facebook.com/teamkander/

When I started my real estate career in 1979 I worked for a man named Glenn Buchwald. He always talked about how when changes occur in the economy (like interest rate increases or new mortgage rules) realtors freak out and think no one is ever going to buy anything and they are going to starve to death! In other words, "the sky is falling, the sky is falling"!

He said that back in the day when people didn't have a lot of money, realtors actually took chickens on trade to barter for real estate services. That's one of my favourite sayings to this day, "I'll even take chickens on trade".
He said that one time when interest rates went up a whole percent (to 6%) a realtor walked in to his office and slapped down his keys and said "I quit! People will never buy houses at these interest rates."

In the 80's, interest rates went from there to 12.5% and stayed there for a very long time. They went as high as 22% and people kept buying houses! Sometimes you just have to relax and go with the flow. The only thing constant in life is change. Hang in there… The sky is not falling! #HTBAR

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Penny/Bryce Kander

Realty Executives Red Deer

403-896-7331

https://www.facebook.com/teamkander/

Crazy ideas that worked. (sold trees for Down payment)

Years ago I had a client who had always wanted to own a quarter section. He wanted it in a quiet, secluded, location with lots of trees and a big shop. One day we found the perfect place for him but there was one small problem...they didn't have enough money for the down payment. I looked around and saw that on this quarter section probably 120 of the 160 acres was tall spruce trees. I thought, "you could hire the guy with the mules and they could do selective logging of the trees".
The trees were worth about $1000 each and he needed $40,000 for the down payment. We had the owner carry financing for a few weeks while we had the trees logged and got enough money for the down payment. They actually used the property to buy the property and ended up with their dream! Sometimes you have to get really creative in this business.

You know the saying, "You can't see the forest for the trees"?
Well, that day I was fortunate enough to see the forest and the trees.

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Penny/Bryce Kander

Realty Executives Red Deer

403-896-7331

https://www.facebook.com/teamkander/

The 5 foot rule!

The Five Foot Rule...

One day when I was out with my son we got into an elevator. Mere seconds passed before I started chatting with the strangers inside. When they got out of the elevator my boy looked up at me and said, "Mommy, do you have to talk to everybody?!"
I thought for a minute and then I said, "You know honey, I do."

I call it the 5-foot rule. Anyone who gets within 5 feet of me has to talk to me. Whether it's in a restaurant, standing in line at the grocery store, in the pool, or on the airplane, it makes no difference to me. I truly like talking to people but it's also a key to success in real estate and in life.

When I was in grade 12 they had a career seminar at our school and the President of the real estate board was there.
My question for him was "how do you be a realtor and how do you get business?"
He said, "just ask everyone you know and everybody you meet if they want to buy or sell a house". So that's literally what I did! When I started out, I would go shopping and I would hand out my card to the teller, to the guy at the gas station, to everybody that I met.
Over here in Hawaii I strike up conversations continuously and I make new friends or I find people that want to buy real estate here and I refer them to other realtors. I can make money just by visiting with people! So stretch yourself this week and talk to some people that get within 5 feet of you. You never know who you might meet. You might find your new spouse, your new employee/employer, or just a new friend.
Have some fun with the
5-foot rule and I'd love to hear stories back of who you meet!

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Penny/Bryce Kander

Realty Executives Red Deer

403-896-7331

https://www.facebook.com/teamkander/

How to buy houses with the new rules and what you should be buying/looking for.

Since the new mortgage qualification rules came in to effect in October 2016 it makes it more difficult for you to qualify for a mortgage. This is because you now have to qualify for your house at a higher interest rate. Your payments are still lower but it just makes it tougher to get a mortgage so here are three tips as to how to get around those qualification limitations.
1. You could get someone to co-sign for you (mom,dad, aunt, uncle, or grandparent). That just allows you to buy a home that you can still afford but can't necessarily qualify for under the new rules.

2. Buy a home with a basement suite. You can actually afford to spend more on the purchase price of a home if it has a basement suite for additional income so that would help you get into the market as well.

3. Buy a smaller starter house; maybe one that needs fixing up that you could fix up. Improve it and then maybe sell in six months. Take the extra money and put it down on the home that you actually want.

Those are just three options as to how to qualify in this tough money market.

Don't buy a car, buy a house and it will pay for the car!

They say that this generation will inherit more money than any of the previous generations to date.

So what should you do in case you inherit some money...even $10-$50K?

In the past 7 or 8 years we have interacted with a couple different young people who both inherited $40,000.

In one scenario, someone convinced them to lend all the money for an investment that was unproven and sadly they lost it all.

Bryce sat down to have a financial discussion with the second one. As is the case with the majority of young people who come into money, this person wanted to go out and buy a new car.

Bryce explained that instead of buying a car that will just depreciate, they could buy a house with a basement suite and a garage and rent them out and the house would pay for the car. They said emphatically, "Bryce it just doesn't work like that!"

But it actually IT DOES...

Cole and Bryce actually both bought houses that did just that.

This is how it works...

They bought a house then for $245,000 and put down $12,500 as downpayment. Then they rented it out for $1200 up and $800 down and that's not even including the garage! Their rental income less payment, (including principal, interest, taxes, insurance) worked out that they would have cash flow of $363 a month. There is the car payment!
Over the seven years since then, they have paid down their mortgage from $232,500 to $155,200. Therefore they had $363 a month cash flow each and every month for seven years. They would have had some improvements here or there but they have also paid down an average of $1100 a month over those seven years.

So instead of buying a car for $10,000-$15,000 that would have been worth nothing 7 years later, they bought a house that appreciated $80,000 and they have paid off $77,300 PLUS have cash flow of $30,492 over the seven years.

Summary:
If those that inherit money had bought a car for $10,000 and just let it depreciate, in seven years they would have zero to show for it and probably be needing another new car.

BUT If they bought the house and invested $12,500, they would've had a total gain of $187,792.
What would you rather have... $0 or $187,792?

This just goes to show that you don't need to start with a lot of money to create wealth very quickly.
The younger you start, the better and you're not getting any younger so lets get you started!

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Penny/Bryce Kander

Realty Executives Alberta Elite

403-896-7331

If you can buy a house for $10,000 down just do it!

MY MAMA ALWAYS SAID...

"If you can buy a house for $10,000 down payment or lower, buy it."

I am going to cover 3 points in this Blog...

Point 1: A rent to own means you skip the bank.

The way you buy a house with $10,000 is commonly known as a Rent to Own. There are 101 ways to do a rent to own but I'm going to be explaining the one Penny Kander taught me.

Basically, a rent to own means you skip the bank & the Seller plays banker for you. If you went to get a loan from a bank they typically require 5% down whereas a Seller may only need $5,000- $10,000 down to act as your banker. 

#Example

On a $300,000 house you'd normally need to put a $15,000 down payment (5%). 

On Rent to owns you give the $5,000- $10,000 as your down payment and the seller agrees to give you "ownership" of the house for 2-3 years and instead of making mortgage payments to the bank you make monthly payments to the owner. Now, this means over those 2-3 years you get the benefits of home ownership. 

•You get the principal pay down credited to you. 

On a $300,000 house you are paying off almost $800 a month on that mortgage which totals  $14,200 over 2 years which will be credited to you towards your down payment. 

•At the end of 2-3 years you have to get your own mortgage and pay out the Seller but you will have put $5,000-$10,000 towards your down payment initially plus the $14,200 that you have paid down the mortgage. You only need 5% down so you'll have your down payment at the end of the rent to own. 

•At the end of 2 years when you go to the bank, you will have a record for 2 years to show the bank you have been consistently making the payments. Also, you can show them your rent credits and show them how much you have into the property and they will give you a mortgage. 

Second Point: What happens if you don't think you'll be able to get a mortgage at the end of the contract? 

If you aren't going to be able to close at the end of 2-3 years the first thing to do is ask the seller for an extension on your contract. Do this a few months in advance of its end date. IF the Seller doesn't want to extend the contract you typically forfeit your down payment and rent credits. 

BUT KEEP IN MIND...

During the rent to own contract you have the rights of ownership of that property and at any point you can sell it, take your profits, and move on. Towards the end of your contract you will have almost $25,000 worth of equity. 

Also in the  2-3 years, maybe the value has gone up and you can sell it for more. 

You get the appreciation if the house goes up in value! 

Third Point:

If you bought a $200,000 townhouse on a rent to own and you put $5,000 down for the Seller to carry the mortgage for you at the end you will have paid down the mortgage over 2 years by $11,000. That amount is credited to you! The Return On Investment is 220% on your $5,000. That's a 110% per year Return On Investment! 

You'll have a $16,000 down payment in 2 years. 

Bonus tip! You can do a rent to own on a suited property and rent it out and make cash flow! 

If you've read my last blogs... you'll see why this is amazing. 

TLDR (too long didn't read) 

Rent to owns mean you now are a home "owner" for an initial investment of only $5,000 down! At the end of 2 years you now have $16,000 equity or you own a house. Rent to owns are great if you need time to qualify for a mortgage but want to start being a home owner and making money right away! 

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Bryce Kander

Realty Executives Red Deer

403-896-7331

https://www.facebook.com/teamkander/

Millionaire: Step 2

A recap from a couple weeks ago...

We talked about a deal on Property 123 Abc Street

You bought this suited property for $330,000! 

You rented out the basement suite and you lived upstairs in this 3 bedroom 2 bathroom legally suited upstairs space for $78 dollars a month! How? By renting out the basement for $900 and living upstairs with 2 roommates plus you rented the double garage to either your upstairs or downstairs tenants@$200 for a combined monthly rental income of $2,200. (Rooms rented at $550 x2 = $1,100, garage rented at $200 plus the basement suite@$900 = $2,200)

123 Abc Street.

Listing price, $330,000.

Down payment:$16,500 

Property type- Legally suited house

Property taxes: $2,400 ($200 per month)

Mortgage: $1,477 per month 

Insurance:  $100 per month

Utilities $500 per month

Total EXPENSES= $2,278 per month

Total rental income = $2,200 per month

Total cost of living= $78

In my last blog post, I write out a detailed explanation of this: http://bit.ly/Homeownershipfor78dollars.

Right now I am going to assume you are paying rent somewhere, for around $550 to $1,600.

If you bought this 123 Abc property you are paying off your mortgage approximately $816 per month on your mortgage for signing a 5 year locked-in interest rate! 

You are now paying only $78 every month out of pocket. At the end of 5 years that is a $55,320 savings in real cash that you'd have had to pay in rent somewhere else.  Even if over the 5 years you saved $17,000 or $18,000 to buy another house, this home allowed you to save money to help you purchase your next home but that’s not all it does... Once you move out of your first home at 123 Abc Street, you can rent out the upstairs to one tenant and have cash flow coming from your basement suite, upstairs and garage all being rented out. 

Instead of it costing you -$78, you now cash flow +$172! 

Therefore, saved rent PLUS Mortgage pay down of $816 per month, for 5 years = $49,000 EQUALS cash savings of $55,320.

Getting excited yet?

Time to purchase house #2! 

456 Xyz Street

Purchase price $340,000   

(The basement suite was new! You can now rent it for $1,000)

Down payment: $17,000

Property type- Legally suited house

Mortgage: $1,531 per month

Taxes: $200 per month

Utilities: $500 per month

Insurance: $100 per month

Total EXPENSES= $2,331 per month

Total Rental income = $2,300 

Total cost : $31 per month

BUT WAIT!

Now 123 Abc is rented out and you have moved to  house #2.

Total Rental income from 123 Abc Street =  $2,450.

Total rental income from 456 Xyz Street = $2,300. 

Total combined expenses= $4,609.00

Total rental income = $4,750.00

Total living cost in your 2nd property, $0 (actually less than 0)

$4,750 - $4,609 = $141.00  You now live for free and have cash flow! 

Plus you have $49,000 in mortgage pay down on 123 Abc street & now you have #2 being paid down and you still aren't paying rent anywhere SO there is another $53,200 in savings.  That savings is based on $1,000/month being your rent. If you are currently a roommate paying $550 you'd only get $28,320! (You get the idea)

Too long? Didn’t read the whole blog?

$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Here is the short and sweet: TLDR.

Buy a legally suited 3 bedroom property with a double garage with 5% down payment. Rent out the basement suite, rent the garage, rent out 2 rooms and live upstairs. Save $28,320-$55,320 in your own rent you'd be paying elsewhere. Use that money to buy house #2.

Live for free in house #2 while your mortgages are being paid by a combination of roommates and renters. Keep saving with your sights set on #3 and #4 and just like that...you'll be a millionaire!!

Don't wait...Give me a call and lets get you started now!

Bryce/Penny Kander

Realty Executives Alberta Elite

403-896-7331

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Peculiar

Peculiar = Purchased Possession. 

A deal on the market is peculiar to people... but once it has been bought for a price, it has value. 

A deal on the market is questionable, until it has been bought. Then people want to know the details how, what & why! It has an established value. 

You have been bought for a price.  You are a purchase "deal" that God saw value in! John 3:16 "for God so loved the world that he GAVE his one and only Son". You are a purchased possession with infinite value!

You're life will be a story people ask what, how and why! 

Home ownership for $78 a month!

This week I am going to show you an example of a deal and talk you through the numbers. 

123 Abc Street

Listing price, $330,000.

Down payment:$16,500 

Property type- Legally suited house

Property taxes: $2,400 ($200 per month)

Mortgage: $1,477 per month 

Insurance:  $100 per month

Utilities $500 per month

Total EXPENSES= $2,278 per month

Most of you will have heard of the terms "Mother in-in law suite" and "legally suited house". 

THERE IS A DIFFERENCE! 

A "legally suited property" is one that has been approved by the city. It is where the windows are large enough for egress (large enough for a firefighter to help you escape). among many other safety and building code upgrades. Legally suited homes are different from Mother-in-law suites because of one major thing… If you don't have your Mother-ln law or family members living in that suite, it is illegal and should not be rented out and does not help in any way with your buying power to purchase this home. 

 With a legally suited house, a portion of the rent from this legal basement suite will be added to your income and therefore help you qualify to buy this house. 

For example, you can rent your basement suite for $900 a month utilities included.

With a legally suited house, you can also rent out your upstairs suite for $1,350 a month utilities included.

Did you know...for extra income you can also rent out your garage to your tenants for an additional $100 a month per stall #DoubleCarGarage.

You can buy these properties for 20% downpayment if you are just buying for investment and not intending to live in the property.  Personally, I would rather buy 4 legally suited houses at 5% down payment than just buying one property at 20% downpayment.

In order to buy with only 5% down payment, you will need to move into one of the suites. 

Lets say you move into the upstairs suite... 3 bedrooms, 2 bathrooms, a great place to live!

Let's say the  basement is rented for $900 and the young couple downstairs wanted to rent both garage stalls from you for $100 each. 

(You are fine with parking your car outside because you always have.)

Rental income is 

$900 (basement suite) + 

$200 (double car garage)= $1,100 per month.

$2,278 (total expenses) - $1,100 (rental income) = $1,178 per month would be all you would have to pay per month to own this great property.

But it gets better…

Here's how you can live for $78 per month!

Your upstairs suite is 3 bedrooms and 2 bathrooms. If you rent out those 2 extra bedrooms for $550 EACH a month, you have an additional $1100 per month income.

Therefore...

Rental income 

$900 (legal basement suite) + 

$200 (garage) + 

$1,100 (Roommates) = $2,100 total rental income 

$2,278 (expenses) - $2,200 (rental income) = $78 per month!

This really works... 

When my mom bought her first property she was 18 years old. She bought a house with three bedrooms and rented out two rooms. The portion of mortgage payment she had to cover was only $5 a month! 

If while you are reading this your mind is playing the "what if" or "if only" game, let me encourage you on that...it is not too late!!

 That was 39 years ago, but it still works today. Okay, maybe inflation has taken over a bit and instead of $5 per month it is $78 per month.  

Can you make your payment of $78 a month? Even if you lost your job you could make that kind of payment on a paper route! 

Now more good news...

Every month, you are paying off The principal amount on your mortgage (every month the amount you owe on your mortgage is getting smaller and smaller) by an average of $816 per month over 5 years. 

$816 x 12 = $9,800 in equity paid off per year.

$9,800 (equity per year)  x 5 years = $49,000.  

At the end of 5 Years you have almost $50,000 in equity and hopefully by that time you've saved enough to buy another one since you're part of the mortgage payment was only $78! 

Next week I will show you how this first house, can buy you more houses!

Bryce Kander

https://www.facebook.com/teamkander/

Realty Executives Alberta Elite

403-896-7331