Thinking about Investment Properties?
As we watch the market slow down, it is evident that we are in a buyers market. This is great news for anyone looking to snap up an investment property. By getting the equity in your current home to work for you, you might be closer to life as a landlord than you think.
Let’s use the following scenario and numbers to get an idea of what your equity can do for you.
Jack & Jeanine have a current household income of $110,000. The value of their current home is $800,000. There is approximately $400,000 left on their mortgage and they pay a mortgage payment of $1740 monthly. There is potential that they could qualify to purchase a new rental property for $760,000 with the required 20% down payment resulting in a mortgage of $560,000 with a mortgage payment of $2400 per month. By renting out both suites in the rental property Jack & Jeanine could get somewhere around $2500 – $3500 a month in rental income. There are plenty of variables but this should give you an idea of where you fit into the puzzle. Keep in mind that interest rates are also subject to change which can impact the results.
If you’re thinking of becoming a landlord here is a link to some vital information on the residential tenancies website.
Being prepared is key! A very important step in preparation is to align yourself with a mortgage broker that can answer all of your questions and provide you with the important financial facts regarding your portfolio. Got a mortgage question? Give Craig Woodward a shout.
Working with the right realtor also plays a major role in the process. The criteria of an investment property is different from that of a primary residence. Your agent should be on top of all contributing factors to ensure that you find yourself that perfect property that will show you the highest possible return on your investment.
Take a look at these potential investment properties in Maple Ridge.