Learn How to Become Rich Buying Older Apartment Buildings

 Learn How to Become Rich Buying Older Apartment Properties 

Step One: A Golden Rule Learn how become rich buying Apartment buildings |At Your Price and Terms; 

Every step you take buying Older apartment buildings will play its role in determining how fast you get rich, and how much wealth you acquire; but negotiating your purchase at the right price and terms.

A “Golden Rule”  that will make you Rich!

  • The fact you see the potential for making the property’s value Jump is your ace in the hole, not the seller’s Don’t give it away is your ace in the hole by offering a price higher that Current Value. Note: Research the local government rules and regulations for rental properties.
  • As a buyer , you should also take advantage of you position as a man( person) with money to spend- money that sellers want to get their hands on.” If you’ve got the Gold, you can make the rules” This is the Golden Rules, keep yourself firmly in control of the negotiating process.
  • First a step to getting rich buying older Apartment Buildings is “doing your homework”
  • Two steps will pave your way for success as a negotiator with the seller and his agent. 
  1. “Math Homework”: Setting your limits beforehand; and
  2. “Psychological Homework”; Improving your position by knowing the Apartment property and the seller  inside and out !

Learn How to Become Rich Buying Older Apartment Buildings|At Your Price and Terms- Step One

PART 2-CALCULATING CAP RATE FOR VICTORIA APARTMENT INVESTMENT

PART 2-CALCULATING CAP RATE FOR VICTORIA BC APARTMENT INVESTMENT

SEE- PART 1- CALCULATING CAP RATE FOR APARTMENT INVESTMENT

New Style Apartment

Using Cap Rates In Victoria Wisely
Image titled Figure Cap Rate Step 4

1 Calculating CAP rates to quickly compare similar Victoria Apartment investment opportunities. The cap rate basically represents the estimated percent return an investor might make on an all-cash purchase of the property. Because of this, cap rate is a good statistic to use when comparing a potential acquisition to other investment opportunities of a similar nature. Cap rates allow quick, rough comparisons of the earning potential of investment properties and can help you narrow down your list of choices.[6]

  • For example, let’s say that we’re considering buying two pieces of property in the same neighborhood. One has a cap rate of 8%, while the other has a cap rate of 13%. This initial comparison favors the second property. It has a higher cap rate, so it is expected to generate more money for each dollar you spend on it.[7]

Image titled Figure Cap Rate Step 5

Don’t use CAP rate as the sole factor when determining an Victoria investment’s health. While cap rates offer the opportunity to make quick, easy comparisons between two or more pieces of property, they’re far from the only factors you should consider. Real estate investment can be quite tricky – seemingly straightforward investments can be subject to market forces and unforeseen events beyond the scope of a simple cap rate calculation. At the very least, you’ll also want to consider the growth potential of your property’s income as well as any likely changes in the value of the property itself.[8]

For example, let’s say that you buy a piece of property in Victoria for $1,000,000 and you expect to make $100,000 per year from it – this gives you a cap rate of 10%. If the local housing market changes and the value of the property increases to $1,500,000 suddenly, then you may have less-lucrative cap rate of 6.66%. In this case, it may be wise to sell the property and use the profits to make another investment. However, it is also possible that the income levels may have increased, or the expense levels may have decreased. Make sure to look into all of the factors involved when determining the cap rate.

Image titled Figure Cap Rate Step 6

Use the CAP rate to justify the income level of the investment property In Greater Victoria. If you know the cap rate of properties in the area of your investment property, you can use this information to determine how much net income your property will need to generate for the investment to be “worth it”. To do this, simply multiply the property’s asking price by the cap rate of similar properties in the area to find your “recommended” net income level. Note that this is essentially solving the equation (Net income/Asking price) = cap rate for “net income”.

  • For example, if we bought a property for $400,000 in an area where most similar Victoria BC properties have about an 8% cap rate, we might find our “recommended” income level by multiplying 400,000 × .08 = $32,000. This represents the amount of net income the property would need to generate per year to get an 8% cap rate. However, keep in mind that you cannot set rental rates based on the cap rate. They must be based on market rates and consider how this rental would compare to other rentals in the area.
  • Source Carla Toebe 

SEE- PART 1- CALCULATING CAP RATE FOR APARTMENT INVESTMENT.

PART 2-CALCULATING CAP RATE FOR VICTORIA APARTMENT INVESTMENT.

E&O

APARTMENT INVESTMENTS VICTORIA, BC

Apartments Investments Victoria BC 

The most common and best understood form of apartment investment for income property is the apartment house.

The apartment house can run from the frame two family house up to the 500 unit apartment complex.

Newer apartment houses are generally wood frame or concrete construction and range from the suburban “ garden type”  apartment house to ultra high -rise apartment building.

See my Income Properties versus Real Estate Investment post.

Older apartment houses of brick (wood frame on the west coast ) construction are usually located in urban areas (although there are a few in older suburban areas). They are generally referred to as elevatored buildings or “walk-ups” (without elevators).

Victoria Apartment Investments

Smaller apartment houses of frame construction are scattered throughout both urban and suburban areas. These generally considered less desirable than concrete and brick apartment house investments, but they may be just right for certain types of investors who want “higher cash flow” or a shorter life span for tax “write off.”

Many larger older homes have been converted into apartment houses. If well located, these can make excellent investments.

With today’s low mortgage interest rates, apartment investors are paying high prices for apartment properties in Victoria and across Canada. Great opportunity for both Apartment owners to sell their income properties and Apartment investors buying Apartment investments with today’s low mortgage interest rates.

Real Estate Investment Trusts are seeking out Apartment investments across Canada for their shareholders. Victoria is a much sought after location for these Buyers in today’s investment market place.

Are you planning on selling one or a portfolio for Apartment properties? Call me 250-413-7042 or email me at fred@fredcarver.com to arrange a time to discuss selling your Apartment Investments. I am currently working with several Canadian Real Estate Investment Trusts wanting to purchase one or several VICTORIA apartment income properties.

CAP rates are low right now, so let’s get together.

 

Apartments Investment In Victoria BC 

Income Properties Differ From A Real Estate Investment

Income Properties Differ From A Real Estate Investment

How an income property differs from a real estate investment .

Income property is to real estate investment as Apples are to Fruit. Income properties (Apples) are a kind of real estate investment (Fruit). However, not all real estate investments (Fruit) are income properties (Apples). 

What makes the difference ?

Real Estate Investments ( a general term ) Any form of Real Estatë can be bought for investment purposes . This includes raw land, houses, apartment houses, vacant warehouses, in short, any real estate, anywhere, can be bought for investment. Ten thousand acres of a swamp in Brazil …Vast acres of desert land..A house in ski country …A forty story skyscraper …All real estate investments .

 Income Property ( a Real Estatë Investment that generates rental income ):

The name itself includes that element of income. In short, income property includes a real estate improvement which generates rental income out of which must be paid regularly recurring operating expenses. ( For example : real estate taxes , insurance, , heat, payroll, etc). All financing costs ( principal and interest payments) must also be paid from the rental income. Income Properties Differ From A Real Estate Investment

What is left over is the “cash flow” or “net income “ on the owners invested income . 

Why Income Properties Is So Attractive To Investors

A vacant industrial building can be bought for investment but not for income.

The same industrial building with rent paying tenants can be bought for income. Vacant land can be bought for investment but unless leased cannot be bought for income. The main reason that income makes such an attractive brokerage commodity. Is an investor can purchase it with relatively low cash down, finance 60-70 percent (sometimes more), and obtain enough income from the tenants to pay the operating expenses, the cost of financing, and give him or her a current return on their invested capital.

Why There Are Fewer Investors For Non-Income Property

Potential investors for non-income producing real estate (such as land) are in much shorter supply. They must not only have 50-100 percent cash available for the initial purchase but also must have sufficient capital to carry the year to year expenses, such as taxes, until the time comes to develop or sell their investment. For every such investor there are several thousand investors who are ready, willing and able to buy income-producing properties.

Special thanks to John Peckham for his training to many commercial and residential Realtors with his brokerage guide to income property brokerage .

Income Properties Differ From A Real Estate Investment

VICTORIA APARTMENTS SOLD BY FRED CARVER PREC

VICTORIA APARTMENT SALES

APARTMENTS SOLD By FRED CARVER PREC

Fred Carver Apartments
New and Existing Victoria Apartments Needed for Investors

733 Goldstream Ave-60 Suites-Google Earth View

2785 Grainger Rd -51 Suites Google Earth View

906 Brock Ave-58 Suites-Google Earth View

1381 Pandora Ave 24 Suites Google Earth View

1310 Hillside Ave-30 Suites-Google Earth View

2100 Richmond Ave 20 Suites Google Earth View

975 Balmoral Ave-38 -Suites  Google Earth View

1300 Yates Street 71 Suites Google Earth View

1224 Balmoral Rd 27 Suites –Google Earth View

1345 Pandora Ave 62 Suites -Google Earth View

2562 Beverly Street Duncan-102 Suites Google Street View

169 Moilliett St Parksville-48 Suites-Google Street View

443 Superior Street -71 Suites-Google Earth View

180 Croft Street-60 Suites-Google Earth View

2433 Malaview Ave-Sidney-60 Suites-Google Earth View

655 Popular Street-Nanaimio-55 Suites-Google Earth View

211 Moilliet St -Parksville-50 Suites-Google Earth View.

1343 Harrison Street-44 Suites-Google Earth View

675 Niagara Strret-17 Suites-Google Earth View

1025 Sutlej Street-46 Suites-Google Earth View

925 Esquimalt Rd-46 Suites-Google Earth View

1430 Stadacona Ave-44 Suites-Google Earth View

1939 Lee Ave-45 Suites Plus Commercial-Google Earth View

1315 Esquimalt Rd-42 Suites plus Commercial-Google Earth View(Converted to Condos)

625 Fernhill Rd-42 Suites-Google Earth View

1435 Elford Street-38 Suites-Google Earth View

1340 Sussex Street-39 Suites-Google Earth View

3905 Quadra Street-38 Suites-Google Earth View

734 Lampson Street-35 Suites-Google Earth View +Google Street View

1911 Quadra Street-34 Suites plus Commercial-Google Earth View

1841 Fern Street-34 Suites(strata plan done unregistered)-Google Earth View

1725 Beach Drive-33 Suites-Google Earth View

2025 Oak Bay Ave-33 Suites plus Commercial-Google Earth View

418 Michigan Street-32 Suites-Google Earth View

1337 Saunders Street-28 Suites-Google Earth View

1300 May Street-17 Suites-Google Earth View

1631 McKenzie Ave-125 Suites-Google Earth View( Converted to Condos)

3868 Shelbourne Street-128 Suites-Google Earth View

750 Cook Street-25 Suites-Google Earth View

2330 Cook Street-17 Suites-Google Street View

866 Goldstream Ave-12 Suites-Sold for Condo Land Development-Google Earth View

1171 Rockland Ave- 8 Suites-Google Earth View

1860 Crescent Road-8 suites-Google Earth View

404 Superior St-4 Suites-Google Earth View

APARTMENTS SOLD By FRED CARVER PREC

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