Invest Kamloops Newsletter | Jan 29, 2015 | Vol 2 | Issue 3
I hope you have a great weekend because after it’s over, so is January!
Here is what I’ve been up to this week:
– went shooting handguns with my brothers(exploding targets from the Powder Keg are so fun!)
– saw an ugly foreclosure yesterday. When the previous owners lost the house they turned on the water, it was so damp in there that the drywall on the celings fell and the insulation was all over the house. I was interested when I heard of a 2500sqft house going to court for $160,000, but after looking at it with my builder it would be better to start with an empty lot! Someone might make some money with sweat equity, but holding costs could quickly eat away any profit, so I am going to pass on it
– created a slide presentation I will be presenting in front of live audiences(you can view a video of me practicing below for a chance to win tickets to Landrush 2015!)
Here is this week’s newsletter:
- AJAX mine expenditures to date – guess how many million?!
- Invest Kamloops TV – The Polar Bear Path to Wealth
- Kamloops Real Estate Investment Club meeting review – An Appraiser’s Perspective
AJAX EXPENDITURES TO DATE
While doing research on an upcoming presentation, I was surprised to learn that “KGHM AJAX INC” has already spent…
INVEST KAMLOOPS TV
Check out this video for a chance to win $200 tickets to the upcoming landrush conference!
KAMLOOPS REAL ESTATE INVESTMENT CLUB
Tonight’s meeting was very informative. Flynn Mirtle Moran is an appraisal firm who have been in Kamloops 55 years. Carey and Brett were very candid and I learned a bunch of new stuff about the appraisal industry:
– In 2008 in response to the financial crisis a 3rd party entity was created to be a buffer between lenders and appraisers in an effort to avoid “collusion”. This third party assigns inspection contracts based on price and many residential appraisers have been underbidding and driven the market price of a full appraisal to below subsistence levels for major firms. The end result is these individuals working from “their basements” are turning out an inferior product/report because they are not in a competent firm, so quality of appraisals is lowered.
– Many in the room agreed, some even advised that the banks have charged them for appraisals, but no one stepped foot in the property.
– It’s a data mining industry now on the residential level(an a very cutthroat business from the sounds of it), where in the past detailed measurements were taken of EVERYTHING and the cost approach was used to value properties.
– Flynn Mirtle Moran is primarily in the commercial appraisal side of things, but is doing residential appraisals as a training tool for their staff. Commercial appraisal certification requires a great deal more industry training and substantial residential experience to become qualified.
– the prevailing cap rate in Kamloops is 6.5%, but for an older beat up building it could go as high as 7%. A brand new building might be 5%
– there are so many factors in determining cap rate: type/use of property, suite mix, age, adherence to a maintenace schedule, etc.
– cap rate is basically a measure of risk, the lower the cap rate the lower the risk of income loss
– cap rate is net income➗ purchase price(or market value as determined by an appraisal)
– it takes longer to become a certified commercial appraiser than to become a doctor
– I asked “how can I maximize my appraised value?” The answer I got was to spend money on bathrooms/kitchens and other high ROI renovations, but trying and hype your property up to the appraiser will likely just annoy him/her. It’s common for the owner to “be in the ear” of the appraiser and it doesn’t influence anything much.
– There are lots of commercial properties transacting in the interior. Storage facilities are being bought up/built in Kamloops, there used to be a shortage of supply for mini storage but it’s now catching up.
Overall it was a great meeting and nice to talk to some knowledgeable professionals!
Be sure to visit next months’ KREIC meeting where I will be presenting “The Polar Bear Path to Wealth” and some deals. See you there Feb 26th!
DO YOU NEED REAL ESTATE ADVICE?
Due to an overwhelming demand for consulting services, I am limiting new clients.
– trying to decide if Real Estate investing is right for you?
– struggling with a nightmare tenant?
– thinking about selling?
If you have a real estate problem, advice from a third party can be invaluable. I have a solid consulting track record and has dealt with evictions, filling vacancies, and every tenant situation imaginable. Since services are in high demand, consulting rates start at $100/hr.
Book a FREE, no obligation, 30 minute phone call with me to learn if we can work well together. Call 1.888.532.7660 or email firstname.lastname@example.org.*
*When requesting a phone call, please provide as much information as possible. A detailed message or email complete circumstances will ensure I can best help you quickly.
DEAL OF THE WEEK
This week’s deal is a slam dunk! This is a 3 bedroom townhouse in a complex where I own 2 units and am on strata council. I am currently getting $1877 incl utilities and $1677 not incl utilities so these places cashflow great for a much smaller investment. Here are the numbers:
To get full pro forma with the address and detailed numbers, you must either be on my investors list by clicking here, or be a paid subscriber(I am practically giving these away.)
You can see what a full proforma looks like by clicking here: 724 Battle Street.
There are simply too many good deals in Kamloops for me to capitalize on all of them. As result, I will be publishing my proforma reports and the plans I would carry out on these properties to produce the double digit returns I talk about on this website.
Since I am doing deal analysis on an ongoing basis anyway, I may as well help anyone who is searching for their next property in Kamloops.
The value of these analysis?
Well, if I could purchase them all, each one would be worth $1000/mo(the REAL cashflow of my most recent deal). Since I cannot at the moment purchase them all, you can have them for $7 each.
Why only seven dollars when I spend at least two hours per week on my initial due diligence? Because I want to make sure the opportunities I find benefit you, my loyal readers. If you can make money with a property I find, that makes me happy.
If you would like to access to the password protected site area “Deal of the Week”,
Invest Kamloops Interview Series
The Invest Kamloops monthly interview series features successful business owners and investors who are benefiting from the Kamloops economy. You will learn the secrets to their success, and specific strategies to implement.
Whether you are just starting out, or have been investing for a while, the stories here will inform and inspire.
Please sample the October 2014 Mastermind call from a successful REAG member with a deep well of experience. It was a pleasure to interview this gentleman: Mel Johnson Interview
Sam Perren is a Real Estate Investment Advisor, Family Man, Published Author, and works as a Police Officer. Sam has purchased over 2 Million dollars in residential real estate, and is a member of Mastermind Networks who’s members have purchased over $5B of real estate. Sam’s education and experience includes two years of sciences at UBCO, two years of carpentry, and more than seven years law enforcement. Sam successfully completed the Canadian Securities Course in 2011, a credential required for all financial advisers.
Sam is growing his portfolio using the S.A.F.E. principles he developed, and has been creating double digit returns using Real Estate since to the delight of his partners since 2009. Sam is seeking more investment partners, however due to time constraints, opportunities to work with Sam are limited.
Minimum capital required to work with Sam is $150,000 unless you wish to buy part of an existing deal, I currently have one for sale for $40,000. Your ability to qualify for mortgages would also be an asset. Your investment is RRSP eligible.
To learn more about the S.A.F.E. business model, and see opportunities available right now, click here.
Sam lives and invests in Kamloops BC, and can be reached at 1.888.532.7660 or email@example.com.