If you're thinking of buying or selling an investment property, it's all about the numbers... Call Us Today to Maximize Your Return on Investment!One of the most important factors to consider when looking to buy an investment property is CASH FLOW: - You need to calculate your projected annual rental income from the property, minus 4-6% for vacancy rates (or more depending on the area)
- Deduct your yearly annual operating expenses including management, strata fees, utilities, maintenance, overhead, advertising, property tax, etc.
- Deduct your yearly mortgage repayment amount.
- Deduct your income tax due on the investment income.
- Ideally, you should end up with a positive number, or CASH FLOW. If you don't, the property will COST you money every year. That may be worth it, if the property value will increase enough each year to cover the loss.
- Don't forget that CMHC premiums are higher for investment properties, and so are insurance premiums.
Talk to your mortgage broker to see how much you qualify for if you're buying a rental property. It might be a very different amount than if you are going to occupy at least part of the property as the owner. For further questions, please call Jackie at 778-549-0696, John at 778-549-4821 or visit our contact us page! Please ensure you consult the appropriate professionals prior to purchasing an investment property, including your realtor, lawyer, mortgage broker, accountant and other professionals to assist you in making a sound financial decision. |