Buying Real Estate inside your RRSP

[edn88]

I am sure that someone here can tell me if this can be done or not.

Can you buy an investment property inside of your RRSP and if so, how do you go about doing it?

[Agamemnon]

Just did a quick google...

http://www.manainvestments.com/mana/RRSP/RRSP.htm

[yads]

You can't buy real estate proper inside your RRSP, but you can buy securities that represent real estate. There are lots of companies that sell these. Be very careful though and do your due diligence. Look up Concrete Equities and learn from that fiasco.

One other thing to note is that these shares are highly illiquid. Unless you're buying REIT shares that are trading on the TSX you may have a hard time selling your shares if you all of a sudden need cash.

[MoneyGuy]

You can't hold physical RE inside of an RRSP, but you can hold similar properties like RE funds, and your own mortgage. I'd hold the funds, but no way would I hold my own mortgage, if I had one.

[sec304]

Originally Posted by yads

You can't buy real estate proper inside your RRSP, but you can buy securities that represent real estate. There are lots of companies that sell these. Be very careful though and do your due diligence. Look up Concrete Equities and learn from that fiasco.

One other thing to note is that these shares are highly illiquid. Unless you're buying REIT shares that are trading on the TSX you may have a hard time selling your shares if you all of a sudden need cash.

We are in this situation right now, they won't let us move or cash out the funds... any idea when or how people actually get paid on these? I am getting the feeling they just hold onto your money forever and you can never get it out

[Incinerator]

Originally Posted by sec304

We are in this situation right now, they won't let us move or cash out the funds... any idea when or how people actually get paid on these? I am getting the feeling they just hold onto your money forever and you can never get it out

Your feeling is probably right, 99% of these "real estate investment" projects are scams, here's a well known local example

Like mentioned above, try to stay with REITs traded on a major exchange such as the TSX if you really want to hold RE interest in your RRSPs.

[edn88]

Originally Posted by MoneyGuy

You can't hold physical RE inside of an RRSP, but you can hold similar properties like RE funds, and your own mortgage. I'd hold the funds, but no way would I hold my own mortgage, if I had one.

And why is that?

[MoneyGuy]

Originally Posted by edn88

And why is that?

Because there are fees so the return has to be good to get value. Also, you're required to charge a compeitive interest rate. Have you looked at prevailing interest rates? They're pitiful. No way I want to get that kiind of return in my RRSP.