Quote:
Originally Posted by Realtor 1
Everyone's situation is different however you do not need to put 20% down. If you want to own a few rental properties, consider buying at a lower % down (assuming 20% isnt a option) and then once you hit 20% equity you can move on and buy another place for 5% down. 20% can come real quick if you are a smart real estate investor and buy on numbers and not personal preference.
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Well, technically you do have to put down 20%. Unless you claim you're buying a second home or some other subterfuge, which completely muddies the situation as then you might as well not claim any taxes on the rent.
On top of that you're paying a higher mortgage and on an already tight cash flow situation you're now paying CMHC insurance. I'm not saying it isn't possible to find a property that cash flows or make good money - just that right now isn't an ideal time for those without a lot of experience to make a go of it. Also I do wonder if the government is going to kill the CMHC second home program which I think would put a good dent in the people who buy rental properties under the pretense of buying a second home. Not sure of the numbers, or how dramatically it would affect demand (if at all) but there's plenty of options out the for the Feds to mess with housing prices, something I don't think will happen to cause a dramatic effect, but it would be in the back of my head if I were thinking about throwing 70k into a property as an investment.
Higher interest rates, increasing the downpayment, killing the second home program, three things (two of which would have to be direct interventions) that I could see in the next 5 years to stall house values increasing. Photon, you're a landlord, you've been a landlord as long as you've been on this site (or it seems like it), you're not who my comments would be directed towards.
Edited for the below
Weird, I wonder if I read this research piece (not the article) in the past, I hope not otherwise I'm having some brain problems
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