Hi pals,
I've been researching rental regions in Canada for the last few weeks, and been thinking about buying a rental for a few years. I will be getting 100k of equity out of my current home and I'm interested in buying anywhere in Canada and having it managed by a property manager. For simplicity, I want something turn-key to not have to pay a lot for updates and repairs.
Some factors I need to figure out, and need to talk to realtors/property managers, and maybe you guys can give me some insight:
1. What cities have potential for buying a rental in? So far I've looked at larger cities/towns in BC, Saskatchewan, Nova Scotia, Manitoba and a little bit of Alberta- Saskachewan and Manitoba have potential; but Saskachewan has a lot of new 2-bedroom condo rentals on the market, and articles I've read indicate it has been difficult to find tenants for these units.
2. What can I reasonably expect services-wise and price-wise from a property manager? an acquantance has told me he pays 10% of rental costs, and the company has arranged for some renovations to his properties. He's said he only talks to them a few times a year and it's been smooth sailing. I've done some posting on reddit and received feedback that property managers are sneaky and screw over their customers. In addition I got the sense people thought what I'm trying to do is sleazy, rather than trying to find an extra revenue stream as an individual investor. I got the sense most of these replies were not by people with rentals. Please tell me what your experience with property managers are.
3. What is a realistic, cash-flow positive % of purchase-price to expect from rentals in Canada? So far; I have not found a place that's between 1%-2% of the purchase price anywhere; using the formula in the 'evaluating a rental property' thread on MMM --> the closest I found was a hour for $190k in Winnipeg that advertised it was renting for $1700. I understand I need to do the calculations to make sure my bases are covered, but from what I've seen of the market, finding 1-2% in Canada is nigh impossible.
4. I spent about 15 minutes reading about REIT's, which may be my fall-back if I can't find a profitable property. Do you own them and do you like them? This question is less important than the other 3; I can do some googling, too.
Thanks everyone.