Episode Transcript
[00:00:01] Speaker A: If you're looking for the skills and.
[00:00:03] Speaker B: Tools to succeed in real estate investing.
[00:00:05] Speaker C: You'Ve come to the right place.
[00:00:07] Speaker B: This show is about breaking through barriers, breaking through limiting beliefs and breaking through.
[00:00:13] Speaker A: To the life that you want to.
[00:00:15] Speaker C: Live through the power of real estate investing. You're listening to the Breakthrough Real Estate Investing podcast. And now here are your hosts, Rob brake and Quinton D'Souza.
[00:00:30] Speaker B: Welcome back, everybody. Thanks for joining us again. I'm really happy to be back. And you know what's different about today than the last three weeks, Quinton here where I am is that the sun is actually out and shining a little bit, which is. It's just been brutal around here for the last three weeks. It's been non stop rain and flooding, like a lot of flooding in the area. I think I sent you a photo of just down from me. One of the sailboats in the bay sank because of the rain. So it's been crazy. And lots of flooding in the houses and, and, and, and a lot of the, the locals are actually been hit pretty hard in the area. So I guess it's more about the cleanup starting now. So that's good to see though. I like this. Haven't seen any sun in a while.
[00:01:20] Speaker A: Yeah, sun is good. I just got back from Tampa. I wanted to look at my properties down there after the first two hurricanes and didn't get much damage to the properties down there. A little bit of stucco work, a fence came down, but nothing too bad. So you know, I was kind of happy about that. And it's kind of neat how fast a lot of the area gets cleaned up. Now the, there's still areas that are still flooded out from the hurricane like the hurricanes and the, the water that came in.
But I mean, I would say, you know where, there, where it wasn't above the flood lines, you know, they've cleaned it up pretty quickly there, there are, the dumps are full though. It was kind of interesting to see like huge football field size is full of like construction garbage and like tree limbs and stuff like that. It's pretty, pretty crazy.
[00:02:20] Speaker B: And so everything is. Oh like the hurricanes and everything are over there. It's nice weather.
[00:02:27] Speaker A: No, usually November, like I think they're expecting something else this week, but usually November is, you're kind of counting on till the end of November. That's the end of hurricane season down there anyways, so just have to watch out. And I connected up with some people that I, I know down there and it was, it was good. And I met my team again. Gave them gifts. Every time I kind of go down, I see them and look at the properties. I always give them a little something just to, you know, keep them motivated and know who I am. Right. So.
[00:03:03] Speaker B: Right. Well, that's good. Yeah, that's good.
What, what kind of, what kind of gifts are you giving out?
[00:03:08] Speaker A: Usually, like, you know, for the property manager, I give her like flowers and I give her chocolates to like custom chocolate chocolates and flowers to take to, to, to the office.
And then one of the realtors, I gave him a bottle of hibiki, which is Japanese style whiskey that I really like. And so, you know.
Yeah, liquor, flowers and chocolates.
[00:03:34] Speaker C: That's.
[00:03:34] Speaker A: That's my go to.
That's okay. If I gave you liquor flower and.
[00:03:41] Speaker B: Drink this and go look after my.
[00:03:42] Speaker A: You'd be, you'd be happy to me more.
[00:03:49] Speaker B: Well, that's good.
[00:03:50] Speaker A: Hey, did you see that, do you see that article with the Windsor landlord? They had a tenant that hadn't paid for 16 months and you know, was in 16 months. Right. And they've been trying to go through the landlord tenant board to be able to get them out.
And so it's, it's in Windsor.
And just as they were trying to go through the eviction order, they, they use the set aside order and set aside the eviction again so that they have to go back to the landlord tenant board. This is like process fraud. You know, we should be charging some of these tenants with fraud and particularly ones that are, you know, you know, doing this just to extend the process. It should be fraud. It should, it should be a charge and not necessarily just a landlord tenant board thing, especially ones that have done it before.
It's just ridiculous. And it's hard for like, just imagine you're a landlord, you own one property and you haven't been paid in 16 months.
That person will never be a landlord again. Once they get them out, they will never be a landlord again. And it's happening unless.
[00:05:10] Speaker B: Unless they're seasoned. Possibly. But can I ask you what is the set aside order? Can you explain that?
[00:05:16] Speaker A: Yeah. So typically what happens is that they'll get an eviction order. The landlord will get an eviction order and the tenant will write into the landlord tenant board saying like, whatever they want. Oh, you know, the eviction.
[00:05:31] Speaker B: My dog is sick. I can't make it to the.
[00:05:34] Speaker A: No, no. Or I.
The person who was hearing the, the matter, the adjudicator was biased against me because of this issue and I would like to have another hearing because of that. And they, you know, whatever they, they, they want to say and that's what they do and they'll do it again and again. I mean, it's important that landlords use tools that are out there to be able to help them. There's open room, which is a good one candle where you can look up past hearings in Ontario anyways, they can look up past hearings and be able to see whether those, there's any notices that have been issued for tenants that you're going to potentially put in your units to avoid that.
Also there's a, I forget there's a couple of new ones that I think landlord easy or something like that. I'll have to get the URLs and put them in the show notes. But definitely something that you have to watch out for, use those tools. And to avoid people like this who are, you know, just using set aside orders to, to do that.
We also have.
[00:06:45] Speaker B: Yeah, that sounds like a nightmare. Like I've, I've had a couple of evictions, went through the process and they were relatively smooth after talking to other people that have tried through the same process.
[00:07:01] Speaker A: Yeah.
[00:07:02] Speaker B: Think that there should be something like, especially when the rules are so lenient for tenants that when it comes to, you know, these things really hurt small landlords especially. Right.
So this should be seriously taken into account, not just the, the, the tenants rights.
[00:07:23] Speaker A: No, absolutely. And if you look at the actual applications for terminations to evict for non payment, if we could just speed up that process to a point where it is, you know, within a month or two months and you get to the point of eviction within a month or two months, you would eliminate probably, I would hazard a guess of about 80 to 90% of the cases at the landlord tenant board just have an automatic eviction process.
And you know, you would save everybody else's hearings therefore would be heard. So all the other tenant hearings, all the other landlord hearings, all of them would all be heard if you had an automatic eviction process like we do in like the state of Florida. Like the state of Florida. When I have an eviction, I just go and go to a judge, get rid of possession done within two weeks, I can have them out and that's it. And yeah, what we have is process corruption in Ontario.
[00:08:35] Speaker B: It's and, and it's a, it's a virus, a widespread virus. Hey, I just thought of this, you know, Elon's Department of Government Efficiency.
[00:08:43] Speaker A: Yeah.
[00:08:43] Speaker B: Okay, so I just thought of this Department of Landlord Tenant Efficiency. Oh, you can't See it.
[00:08:49] Speaker A: Oh gold. Adult. Adult.
I was thinking of D O G I Doggy which is like what, what are our Ontario? And, and federal government is like the Department of Government inefficiencies.
They're dodgy.
[00:09:09] Speaker B: Oh yeah, no, we don't want that though.
[00:09:11] Speaker A: That's what we're trying, but that's what they already are.
[00:09:13] Speaker B: Dodgy. Dodgy. Yeah.
[00:09:15] Speaker A: Like the other thing we have to keep what else is new population announcement changes. Right. The government of federal government has announced basically that they're going to eliminate the number of new immigrants that they allow into Canada.
You would have thought when they looked at the number of new immigrants that were coming in and they moved from like whatever, whatever it was 200,000 to 800,000 that, that you know, that they would have had a problem. You would have think that they would have had a problem. Right.
[00:09:52] Speaker B: And well I mean it go. It's in alignment with housing availability. Right. And yeah, yeah.
[00:09:58] Speaker A: Oh yeah, you would think. But no, definitely not. Right. And then, and then what happens is that everybody gets upset and you shouldn't get upset at the new immigrants coming in because they're just looking for, you know, a new, a new life. But definitely the government that allows them in. Why did we ever leave that? You know the system where we had a credit and you know, you got points. It was a point based system for bringing in new immigrants who had specific qualities or jobs or trades that we need in Canada rather than just, you know, whatever. Right. I think we've made some huge policy errors here from the, from the dodgy governments there.
[00:10:46] Speaker B: Yeah, well, I mean I don't, I don't necessarily know about that, but I think there should be some kind of, you know, it shouldn't just be.
The numbers should be based on something. The allowance of new immigrants should be based on something, some kind of metrics that, that allow them to fit into society, blend into society.
[00:11:09] Speaker C: Right.
[00:11:09] Speaker B: With, with the, the people who, who grew up here. There. Here.
[00:11:14] Speaker A: Yeah, no, but it's definitely. And what, what, what's going to end up happening next year is that we're going to see a. And based on some of the demographic changes, a population decrease of 1% which in effect, because a lot of the immigrants that are already here, those would be the immigrants who become, you know, permanent residents. But that means that we're actually going to have a net decrease in population because some of those people will leave too. But also what that means for us as people who are in investment property is that we could see vacancy rates increase.
[00:11:56] Speaker B: Well, It's a decrease in, in immigration. Not necessarily population though.
[00:12:00] Speaker A: No, but definitely when you look at the, the people who come to Canada, the new immigrants that come to Canada, they usually rent, they don't buy, they usually rent and they usually come to the big centers. So let's say the GTA or Toronto or Vancouver, they come into the big centers and then those people who are in the big centers, they move out and those other people move out and you get that ripple effect. Well, when you don't have the number of new immigrants coming in, what we may see is higher vacancy rates and lower rents as a component of that. So it may be something that we have to watch out for next year, in the year after. I'm not saying so.
[00:12:43] Speaker B: Eh, I think, no, I think that's a stretch. That'd be hard to.
[00:12:47] Speaker A: Well, I'm already seeing it across a lot of the portfolio I've seen like rents are.
[00:12:53] Speaker B: Well, I mean, what about like, because the, one of the big things that you and I have been talking, talking about is the condo completions, the new condo completions. And I know you say that these new people aren't renting, but some of those are going into the rental market and some of those are people that are now ready to purchase.
So how does that work into the equation?
[00:13:12] Speaker A: Well, that, you're right, the number of completions this year was off the charts. Right. But a lot of the people who had the completions are putting their condos on the rental market and not necessarily selling them because they would be selling them at a loss and in many cases. And so they're holding on to these negative cash flowing condos because their interest rates are quite high and you know, they're losing, you know, two, three, $4,000 a month in order to put this off, in order to perhaps sell it at a later date. But they're coming on to the rental market and the rental, the rents in the condo market are actually going down and that is again that ripple effect. You see that outside of the gta. So I've seen some of the rents out in Osh Otua decrease a little bit, 100, $200 as opposed to where it was maybe a year ago. So if you have tenants that are already in a unit and you know, it may make sense, you have to look at what the actual comps are in your market. You may want to keep those tenants in there, not necessarily turn them over, which is usually the case, especially if they've only been in there a year or two. Right.
[00:14:28] Speaker B: Especially outside of the GTA that'll be now with more affordable choices right in Toronto. You're going to have people migrating back into the city too.
[00:14:40] Speaker A: That's very true. Yeah.
[00:14:41] Speaker B: Yeah.
[00:14:42] Speaker A: We also have rates, you know, coming down which, which will be, you know, positive for the market. So, you know, hopefully we see. I'm hoping for a 50 point cut in December, but I'm, I'm thinking it's probably going to be a 25 point cut, but, you know, I'm really hopeful for a 50. I think we're behind the eight ball, especially with this stress test. Like now they've removed the stress test in between when you're switching mortgages, you don't have to do a stress test. You know, honestly, I think the stress test should never have been put in place in the first place. I really don't think that it helped us. I think that that proper underwriting of any mortgage and looking at incomes by the institution that's lending, that's who, who's who should be, you know, the most concerned, not necessarily offsea or these other government agencies. It should be those, those banks. And I don't think that they want to have a stress test and I don't think they need it.
[00:15:50] Speaker B: I really don't agree, I'll agree with you that it, I don't think it should have ever come into play. But do you, do you, I'm just wondering, do you think that like that the real issue was that, you know, the stress test wasn't as drastic as the actual market went.
Right. So therefore that's why it didn't really help.
[00:16:14] Speaker A: Well, I mean, like you can't have interest rates at 0%. Doesn't make any sense. Like, like that's that I can see where at that time, you know, but even then any, anybody who was in that space, you know, as a banker or in finance, was still probably underwriting at a higher rate just to ensure that you're able to, you know, these people are going to be able to continue to pay if interest rates go up.
[00:16:41] Speaker B: Yeah, theoretically. Right, Theoretically. But a lot of people got into trouble because it was way worse than, than anyone thought it was going to be.
[00:16:50] Speaker A: Yeah. Interest rates increased like a thousand percent in, you know, 18 months. That's, that's, you know, very challenging for anybody in any environment. And, and then you start to see the real estate investors who are swimming naked. Right. The people who like prom notes that are, you know, going bankrupt and all.
[00:17:08] Speaker B: This stuff anyway, loves to talk about being naked.
[00:17:12] Speaker A: Yeah.
[00:17:12] Speaker B: Going like, what is the Bathing. What are you doing?
[00:17:22] Speaker A: Nature forest bathing or the forest bathing for if you're. You're hiking and when you go out.
[00:17:29] Speaker B: Walking around in the forest, you don't have to.
[00:17:31] Speaker A: You don't have to go naked.
[00:17:32] Speaker B: You don't have to be. But you prefer it that way.
[00:17:34] Speaker A: I never said that. What's going. Where are we going with this?
How did we get to forest bathing? Oh, my God.
[00:17:41] Speaker B: So it's like you tell people they can hook up with you if they want to call for a half an hour.
[00:17:46] Speaker A: All right, this is going the wrong direction. Mr. Break, can we, can we talk to our guest here?
[00:17:53] Speaker B: That would be a good idea. But first, one thing I want to say first is go over to the website Breakthrough, reipodcast, ca.
You know, get in contact with all the guests we've had on before. Then go over to itunes and just leave us a rating and review, please. If you haven't done that, go over, leave a rating and review. Tell us what you want to hear more of on the show. I'm sure it's not what we were just talking about, but whatever it is, let us know.
[00:18:17] Speaker A: Awesome. So I want to make sure that I encourage people to, you know, give us that rating or review. It really helps us out. And I wanted to introduce Kali Breath Wadi. He's a real estate investor and licensed tradesman. He's built up his real estate portfolio while working as a pipe fitter in the Alberta oil fields. His company now focuses on finding, funding and financing Win win real estate investment opportunities for his partners and clients. He's a husband and father who's committed to personal growth and began real estate investing because he wanted a way to support his family's lifestyle while creating wealth for others. He has over 10 years of real estate investing experience in southern Ontario and more recently in New Brunswick. His real estate portfolio and consists of a mix of buying holds, burrs, flips, pre construction, condos, assignments and developments, all kinds of things.
[00:19:19] Speaker B: It's a mixed bag. Welcome.
[00:19:21] Speaker C: Hello.
[00:19:23] Speaker B: Thanks for coming on today, man. Taking the time for us.
[00:19:26] Speaker C: I appreciate it. Thanks for having me.
[00:19:28] Speaker B: So one of the things that I've been trying to focus on is what real estate is afforded us, like, as far as freedoms go. So I, I just wanted to start with, like, tell us a little bit about yourself, you know, outside of real estate.
[00:19:42] Speaker C: Yeah, man.
Well, like in the bio, I'm, I'm a proud father, a husband. I got three kids who are, two of which are now starting to get into some pretty competitive soccer. So I, I spent A lot of time looking forward to enjoying them, enjoy themselves. And that's, that's, that's, that's some of the freedoms that I've enjoyed from the decisions that I've made in real estate that I've been able to do these things. I've been able to.
I enjoy connecting with people. I'm, I, I love people. So I, I love having good conversations and stimulating conversations. I like learning, I like impacting others and myself. What I like doing physically is I, I love basketball. And as I get older, I realize that I can't, I don't heal as quickly whenever I get injured. So my goal now is to find ways to recover quicker when playing basketball because I want to continue to play. And, and it's, it's kind of my form of my meditation slash therapy.
[00:20:48] Speaker B: Do you do like an ice bath or anything like that? Is that. You got that radical yet?
[00:20:54] Speaker C: No, I started doing forest bathing.
[00:21:00] Speaker A: Oh, no, here we go.
[00:21:01] Speaker B: It depends on what season. That's pretty much the same thing as an ice bath.
[00:21:05] Speaker A: Yeah.
[00:21:05] Speaker C: You know what though? I actually started doing cold, taking cold showers and that was a big leap for me because I used to get frustrated when like the hot water ran out and I had to take a lukewarm shower. And I know now that I've kind of mentally adjusted to, to realize that it's okay. Not that the hot water is running out, but I've intentionally taken cold showers just to kind of get the impacts of that after, after playing or to help with some of the recovery. But it is, it's a bit of an adrenaline rush and I'm glad that I finally been brave enough to do it. But it's. It's nice.
[00:21:41] Speaker B: Right on.
[00:21:42] Speaker C: Yeah.
[00:21:42] Speaker B: No, that's good because, you know, I think that, well, time freedom is something that we should definitely be focusing on as a huge reward for, for people that get into real estate. And so, you know, myself, I have.
[00:21:55] Speaker A: Seen.
[00:21:58] Speaker B: More of my kids lives than I ever would have, that I would have been able to be part of, you know, if it was any other way other than if I was, if I was working, you know, my old job, which was 14 hours usually minimum, away from the house every day.
So, you know, real estate has been like a huge blessing. And people say, oh, then you got to deal with tenants and then you got to deal with toilets and maybe you do, but I mean, it's really not a bad trade off, you know.
[00:22:27] Speaker C: Totally, man.
[00:22:27] Speaker B: Thanks for sharing that, man. I appreciate it.
[00:22:29] Speaker C: Yeah, yeah, yeah. Just to just. There's Some parallels here. Like if I look at my past, you know, role or employment career, you know, I was traveling two weeks away from the family at a time. So I would go to the Alberta oil Sands for two weeks duration, work 168 hours, come back home for two weeks, go back and forth, back and forth. So now that I've been able to use real estate to fund my lifestyle, I'm able to be home every night. And that was a big win for me. And you know, there's, there's, there's five things every day that I kind of remind myself that I'm grateful for at the beginning of the day, at the end of the day. And you know, those, those five things are, you know, I'm, I'm grateful for being able to read, learn, grow and have stimulating conversations. I'm grateful for being able to travel and positively impact others. I'm grateful for be able to enjoy my wife and kids, enjoy themselves. I'm grateful for be able to create wealth for my friends and family. Then I'm grateful and I have like a dollar amount of income that I'm grateful for being able to earn monthly through real estate transactions and sale proceeds. So like it's, it. I can relate, man. I can definitely relate.
[00:23:42] Speaker A: So what type of properties do you, do you invest in now? Like, what do you, what do you look for? How do you find your deals?
[00:23:49] Speaker B: Can I, can we, can we. I would, I want to hear how we got started though.
[00:23:54] Speaker A: Oh, right, that makes more sense.
[00:24:00] Speaker C: Well, I got started with. So it's funny, I used to work at, I got, Years ago, I had a co op placement at a hotel in Toronto, the Grand Hotel. And I worked in a few different departments. And then finally I started doing, working as a, as a, as a bellhop and one of the limousine, like the airport limousine drivers that we used to send business to.
I had the luxury of riding in his car one day to a family gathering. It was Christmas and I had him bring me there and I had a chance to pick his ear and he was telling me about real estate and that back then he was like, you know, I bought my first property with 5% down in Coxwell and Gerard area. Rented it out, you know, then a few years later I refinanced it and I bought another one and I did another one. He had like six units, six, six homes where he did this process and you know, I was probably like at the time 19 or 20 years old. I'm like, man, sounds so simple, so smart. What do I got to Do. So basically fast forward. I think I bought my first property probably around 12, 13 years ago. I don't remember the exact date, but my first rental property, sorry. And there was the same, same thing. So I said, like, let me buy something that is easy to manage. So I bought a condo townhouse in Oshawa, easy to manage. I was still traveling back and forth to work, so I thought that being a condo, there'd be a little bit less management on my side. I'd be paying the prop. The, you know, property management, condo fees, that kind of stuff. And it worked out really well. So I had a tenant in there, he was a student from Saudi Arabia on a, on a, on a Visa program. And he said to me one day, he's like, cali, I love your place.
I have other people coming from Saudi Arabia that are looking for something just like this. Do you have any more? So I'm like, you know what, let me find out. So I went online, looked for another property of the same, in the same complex.
Crazy, crazy, crazy thing. There was one available, and I had no idea that the one available was owned by a buddy of mine from Toronto. Like not even Oshawa owned by him that he had listed. And I had no idea that he listed it. So I ended up buying my friend's unit. And then I did that several times because then the people that lived there, I treated them really good and they wanted to spread the word and you know, we, we, we were able to, or I was able to kind of scale that way, but it was, I was limited to what I could do because they were all single family properties and they were condos. So fast forward, you know, maybe seven years, eight years later, I ended up at Durham rei. And I was. Yeah, so I had a chance to talk to you, Rob, talk to Quinton. It was my first time at like a investor meetup in a very, like in years. And it was, it was totally vibrating, like I was there. And the icebreaker that, that, that really helped someone like myself, coming from being immersed in, you know, a blue collar world of working on the, you know, in the trades, you know, there was some conversation of real estate, but most people were just kind of doing the job and whatever they did in the personal life was not investing. But I was really intrigued with real estate. So sitting down at that event, there was an opportunity, Quinton, where you had people who had deals, you had deal deal sharing. So you share a deal. You'd give, like, you'd bring like a $50 gift card or something. Like that. And, man, was that, like, an awesome icebreaker because for someone like me who didn't know anybody in the room, it was an opportunity for me to get around other people and have conversations related. Like, it was just easy to. To break the ice and jump in those conversations, being a total stranger. And then, Rob, you were there to kind of reinforce who the best coach was at the time to. To kind of. Or the coaching program, slash coach.
[00:28:13] Speaker B: Who was it?
[00:28:14] Speaker C: Yeah.
Yeah. So. So everyone.
Everyone recommended Quinton. So I. I signed up for the program right away. And it's funny because I. Yeah, anyway, I. I signed up for the program right away and I. And I. I started to get some more confidence and understand that, you know, with single family homes, you're really limited. But it was so good just that I got in. I'm so happy that I got in because the fact that I got in when I did, even though it wasn't the perfect property type, it was perfect because it led me to where I am today. So that's. That's my intro.
[00:28:57] Speaker A: So.
[00:28:57] Speaker B: Yeah, you said something there that, like, when you. So I've heard of a lot of different programs, like real estate education programs, and I. And I. I haven't taken too many, so a lot of them were just on paper. But then when I did Quentin's, we were out. We were. We were, you know, we were in the field looking at people's properties, what they were going to do with it, you know, what the best plans of. Of how they could, you know, reach its highest and best use and all that kind of stuff. And I found. Quentin asked me then. I remember this. I don't even know I was in your first course.
[00:29:34] Speaker A: Yeah.
[00:29:35] Speaker B: And. And you said, like, you called me afterwards and wanted feedback. Right. And the. The only thing. And like, this is not blowing smoke. Okay? Everybody listening. But the only thing that I could think of is, like, man, at times it was really hard for me to take in all the information. There was just so much there, you know, that that's, I think, probably my only complaint. And it's not even a complaint, obviously. It's about a good problem to have when you sign up for a course. But I really, like, maybe a suggestion that I could give people listening is if you could find something that has, like, you know, a very practical application for someone who's. Who's helping you learn real estate for the first, you know, for your first course, I would say that would be definitely the right move.
[00:30:24] Speaker A: All right. I. I appreciate what you guys are doing. So thanks to that. You don't. Don't have to keep.
[00:30:30] Speaker B: Do you still have a course or.
[00:30:31] Speaker A: Yeah, yeah.
[00:30:32] Speaker B: Oh, you do.
[00:30:33] Speaker A: Okay, but I don't wanna. I don't want to push that here for sure, but I.
[00:30:37] Speaker B: Well, that's what we're here for, Quentin. I mean, come on.
[00:30:40] Speaker A: I appreciate both of you saying so, but.
[00:30:44] Speaker B: Okay, well, has a course, so he'll tell you how to get in touch with them at the end of the.
[00:30:49] Speaker A: I'm always happy to chat for. With anybody on real estate for 15 minutes. Okay, so now we know how you got started. What are you doing now? What type of properties do you invest in right now? What are you looking for? And how do you find those deals?
[00:31:04] Speaker B: Oh, man, that's like four questions. Right?
[00:31:07] Speaker C: Okay, well, look, I just started blabbing away here. You could. You could dissect or take. Take. Take the value.
Basically, I'm. I'm looking for properties with two units or more to hold on to. But what pays the bills for me today are actually flips that I do in single family homes, and I'm usually flipping properties. So I have a. I have a buy box that I stick to, and I've. I've. I've built this buy box from.
You know, when I first got started in flipping, which was in 2020, I was really just buying anything everywhere. And as long as it seemed like there was a spread, I would buy it. And what I realized is that with the cost of private money, when you don't sell, when the property doesn't sell as quickly as you forecasted it to, the carrying costs are very high, and it leads to. It can lead to. What I always try to avoid are sleepless nights. Like, I don't want sleepless nights. So I realized that the best way to avoid sleepless nights is to aim for base hits, not grand slams. So my base hits, my buy box is 330. 30. 30. So what that means is properties that are under $300,000, renovations that I think I can do within 30 days. That's 30 days of work. Not necessarily 30 calendar days, but 30 days of actual work happening with a renovation budget of 30k or less and a profit of 30k or more. Now, there's some flex sometimes, you know, like, the last property I purchased was less than $200,000, but the renovation budget is closer to 60,000.
So it made sense, right? The profit margin is going to still check my box. So it make. I make. I make concessions. I make. I make adjustments based off of the purchase price, based off the time, you know, I make a decision, deal. A deal. But it makes it very easy for me to, to decide on what properties to take and what not to take as long as they fall within that buy box. So I've created that just to streamline things and make it easier because this is, this is my job, right? Like I, I, I do one, I got to do another, I do another. So I realized set up, setting up some processes, systems and processes is definitely makes it easier for me to maintain and continue doing it with, again with sleep, with, without sleepless nights.
[00:33:39] Speaker B: So that's, that's, you mentioned systems and, and tools to help you get through the flips as well. So you're not doing them locally?
[00:33:50] Speaker C: No.
Yeah, most of them are. All of them aren't local.
[00:33:54] Speaker A: Very interesting. Very cool.
[00:33:56] Speaker B: Right, Right. So tell us, where are you doing most of your work?
[00:34:00] Speaker C: So today I'm doing most of the flips in the Moncton area. So like Riverview, Moncton, Dieppe, of, of New Brunswick.
[00:34:10] Speaker B: And what made you decide on that? Is it you could get the 30, 30, 30 pretty easily? Is that.
[00:34:15] Speaker C: Yeah, well, the 30, the 30, 30, 30 came after actually. So what I liked about there was, so one thing I learned again, I'm going to give a plug to, to Quinton's program was just focusing on multiple exit strategies, right? So you got to have A, B, C, D, maybe even E. If you want to keep going, go as far as you can. The better the deal is, the more exit strategies, as long as you don't get too confused deciding on which one to do. But what I liked about there was some factors like the rent to value ratio was a lot higher than it is here locally in southern Ontario.
I can give an example in, you know, I live in Durham, so let's use a house in Whitby, Ontario, for example, that is valued at a, at a million dollars. And you know, if I was to convert the basement at a secondary suite, maybe I'll get 3000 upstairs and maybe I'll get 2000, 2500 downstairs. This is like very, very good scenario, right? So let's just say $5,000 per month income. So we all know the 1% rule, right?
Which us as real estate investors, it makes it easier for us to decide on a deal without doing a crazy performer. Just really quickly, hey, if the value is 500,000 and my rent is 5,000, that's the 1% rule. Chances are it's going to be a profitable purchase, profitable investment.
So using that metric, that property in Whitby that's valued at 1 million. Just bringing in 5,000 is about 0.5%. Right. So it's a half of the 1% rule in New Brunswick. I'm fine. I'm able to find properties that are, you know, let's call it a single family home without even adding a secondary suite. If I buy it for 200,000, I could probably rent it out for 1800.
Now, if I add a secondary suite to it, I can. It's going to cost me to, you know, some to. To create that lift, but I could probably rent out the basement for maybe 1200 and then upstairs for 1600. So now I'm getting 2800 on a property that is now where I can force the value up to roughly 350,000. Very conservative numbers.
Okay, I don't have a calculator here.
[00:36:47] Speaker A: Yeah, 3400, sure.
[00:36:50] Speaker C: So what I'm getting at is that the rent to value ratio out there is significantly higher. Right, Right. So, Quinton, are you. Do you have. Yeah. You have a calculator in front of you?
[00:37:03] Speaker A: Yeah. Yeah.
[00:37:04] Speaker C: Okay, so what would. So let's just say if I have income coming in on a $350,000 valued property and the income that it's coming in is, let's call it 1200 downstairs, 1600 upstairs. So 2,800.
[00:37:21] Speaker A: Okay.
[00:37:22] Speaker C: It's like 0.75% maybe.
[00:37:24] Speaker A: Yeah.
[00:37:25] Speaker C: Is it exactly 0.75. Okay, so it's 0.75%. So that's what I like about it, Rob, is that the rent to value ratio is a lot higher. That's one one plus another one is the landlord tenant rules. I heard you guys talking about some scenarios a little bit earlier. So the landlord tenant rules are much more favorable for landlords in New Brunswick, where if the tenants don't pay within about two months, they're evicted. And they know this. So instead of them telling you, like, hey, I'm the tenant. I have all the rights. They'll just get up and leave. So they'll do a midnight move, which is, for me. It's perfect, because now I don't have to worry about, like, you know, paying for them to live in my property. I can get them out, and I can clean up and get someone else in there as quickly as possible.
[00:38:17] Speaker A: I just wanted to clarify something. Yes. The upper unit is 1800. The lower unit is 1600.
Is that correct?
[00:38:25] Speaker C: So as I was talking, I was just using an example. I don't remember two different.
[00:38:31] Speaker B: You said 12. 1600.
[00:38:34] Speaker C: The second. Yeah.
[00:38:36] Speaker B: 2800. So. So, but. But here's my question. Okay? My question is this. Now you're. You're going off the value, not what you've got put into it because you said, like, theoretically, just, you know, you said Basically it's a $200,000 buy price and you're probably putting in, what, 75 or 80 to do the renovation. So really, you're only in it for the two.
[00:38:58] Speaker C: No, even less. Like, I'm talking.
[00:39:00] Speaker B: Okay. Sorry.
[00:39:01] Speaker C: Yeah, I'm talking like 50 less.
[00:39:02] Speaker B: Right.
[00:39:03] Speaker C: 50 grand rentals. So even better.
[00:39:04] Speaker B: So doing that. So. So it really should be based off of what you've got into it. Right.
[00:39:09] Speaker C: So you're.
[00:39:10] Speaker B: You're hitting that 1% rule on that deal. No problem.
[00:39:13] Speaker C: Totally. Yes. Yeah. 100. 100. And it gets better. Like, I can. I can give you like a real live example. That deal that just. Oh, yeah, it's closing really soon where, you know, the purchase price is 255,000.
[00:39:28] Speaker A: Okay.
[00:39:28] Speaker C: The rental budget is 45, 000. So we'll call it 300 grand all in.
[00:39:34] Speaker A: Okay.
[00:39:35] Speaker C: That's adding a secondary suite. Like, there's already, you know, that's a. Adding an in law suite. Okay. Okay.
Getting the value up on the conservative side to around 380, 000. So the appraisal hasn't happened yet. But that is. That's my calculation based off of comps and the information that I have. So what I like about that is that the investor in that deal, whether it's me or someone else, is going to have to come up with around 50,000 as a down payment.
45,000 renovations call it. Yeah, 95,000. And let's say there's $15,000 in carrying closing costs. So that's 95 plus 15. We're at 110.
[00:40:29] Speaker A: Right.
[00:40:29] Speaker C: Okay. So we take that 300. We add 15,000 to it. So we're at 315,000 total investment.
[00:40:41] Speaker A: Okay.
[00:40:41] Speaker C: Then we refi at 380. 80% of 380 is 304,000. Yeah. So the investor has roughly $11,000 left in the deal.
The income that I'm projecting to Renegade renov generate on this particular property gross is 1700 upstairs and 1500 downstairs.
Now, this is conservative compared to what my property manager, who always hits whenever she tells me what. What the income is we think we're going to get. This is conservative. This is like $600 less than what she's told me we should expect to bring in on this property.
[00:41:34] Speaker A: Yeah.
[00:41:35] Speaker C: So if we think of the return on investment.
[00:41:37] Speaker B: Are you doing that? Is that an all.
[00:41:39] Speaker C: That's all.
That's. Yeah, that's. That's including utilities.
[00:41:44] Speaker A: That's interesting. This, you know what these numbers, these, these numbers remind me of Ashwan 2013, 2014. Like, the numbers, like, honestly, when we were, when we were doing flips or when I was doing flips, I was doing flips and adding basement suites and I was do, like. I think the least I spent on a basement conversion was like, 35K. Now, like, people are spending, like, I don't know, 150K or something too much. But I mean, like, these numbers sound very similar. But I guess the question is now, do you flip those or do you actually. Because you said that was a flip analysis, or are you actually holding on to it?
[00:42:26] Speaker C: Let me clarify. So, so anything with a. That, that cannot be converted is what I flip. So this property we're going to keep, it's, it's, it's, it's very difficult to find these types of opportunities. I call them unicorns. But when I do find them, I want to hold on to them. So because I'm always looking at deals, I'm always picking up deals, I'm always thinking, can I hold on to this? And quite often I can't. The numbers just don't make any sense. So I'm forced to flip it. But this is a keeper.
[00:42:56] Speaker A: Interesting. How many of these do you end up keeping?
[00:42:59] Speaker C: So right now I have three of these in Moncton.
[00:43:02] Speaker A: Okay. And then who, who qualifies for the mortgage?
[00:43:08] Speaker C: The investor.
[00:43:09] Speaker A: So the investor qualifies and then the investor puts the capital in. But then do they get all their capital out first, 100% even from the cash flow or.
[00:43:21] Speaker C: No. So just, just for the equity. Yeah. So the cash flow, we split the cash flow. We usually create a bank account, joint account. We haven't done any draws. Everything stays in there. It doesn't, you know, the cash flow is not enough to really change any of our lives at this, with this volume, this, you know. But so for now, we keep everything in the bank account. It just, just grows. We like watching it grow.
[00:43:44] Speaker A: Yeah, this is cool. This is. This reminds me so much of, like, you know, 10 years ago, 11 years ago, like what I was doing. So. Yeah, it's really cool. Very neat stuff.
[00:43:56] Speaker B: Well, it's giving me the itch, you know, and it, and it is more attainable than where we find ourselves in southern Ontario these days.
[00:44:02] Speaker A: Yeah.
[00:44:04] Speaker B: Trying to, trying to find something that makes any kind of sense whatsoever, like that Whippy property you were talking about?
[00:44:12] Speaker A: Yeah, it really is the challenges of finding cash flow, first of all. But then, you know, the ways to be able to do that now require you to, to do a lot more to a property to achieve that, which often means taking like a single family and adding two or three units onto it in order to make the numbers actually work. Whereas, you know, Cali here, he just has to add a, you know, find the right property, first of all, that will allow him to do that.
Are there any ever. Do you ever find that there are issues with getting financing in Moncton? Because sometimes smaller markets, the actual financing of it becomes a challenge because not all financial institutions will allow you to get mortgages outside of the province and in particular Moncton. Do they have any rules against out of province investors? Because that's something that I'm hearing more and more of.
[00:45:15] Speaker C: Well, okay, the only thing that I had to do, so starting out, when I was like figuring things out, it was a lot more challenging because I didn't have the right, you know, it took me a while to find the right lenders, the right brokers, the right institutions that would do deals out there. So I, I did experience that starting out.
But now I have, I have established, I've, I've, I've found solutions to all of those problems. The only thing with my corporation, I did have to get a interprovincial, fill out an interprovincial application in order to borrow out there with my corp. Where is an Ontario corporation set up? In Ontario I didn't, I didn't need that, but in New Brunswick I needed that.
[00:46:00] Speaker A: Okay, so you had to have that corporation set up ahead of time and, and that allows you to finance those properties from the flipping side.
[00:46:08] Speaker C: From the flipping side.
[00:46:09] Speaker A: Okay. Yeah. What about the hold, what about the holdings?
[00:46:11] Speaker C: I have, I have bank financing with my joint venture partners.
[00:46:15] Speaker A: Okay. Now is it like tier A bank or.
[00:46:17] Speaker C: Yeah, yeah, yeah, yeah, yeah, yeah. And then that's. Hey, go ahead, Rob.
[00:46:23] Speaker B: Well, I.
Sorry, I don't want to brush over that. Say what you were going to say.
[00:46:27] Speaker C: I just really quickly, one of the, like, there's, there's all these pluses that I love about there. And one of the things is that because the price points are as low as they are, I can comfortably raise the capital to, through private financing through friends, family, you know, what have you to purchase these things without having to check all the boxes of underwriting from an A Len and then you can.
[00:46:51] Speaker B: Take it to the bank when it's done or, or or you just sell it.
[00:46:55] Speaker C: Yeah, exactly. Exactly. Yeah, yeah.
[00:46:58] Speaker B: Oh, absolutely.
[00:46:59] Speaker A: I would think with that type of a burr with almost like leaving 10,000 in, you use the flip money to be able to do it and just hold it yourself. Is it. Are you. Do you have any challenges with getting financing for a brrrr in like yourself and that's why you want to use a partner? Or because, like, if you're taking out that much capital, like, I mean, one of the things that I reflect on in the past is that I wish I kept a lot more of the properties instead of partnering with a lot of people, because I could. I did, and I'm happy that I have because I provided a lot of returns to those people. But in retrospect, it makes my life more complicated. I can't make decisions by myself. I need to talk to those people. Well, like, what kind of has made you decide on doing it this way? And are you kind of forced to do it because of financing?
[00:47:58] Speaker C: Well, when I took your course, you told me do it this way.
Anyway, I just think that for. For scaling, you know, and. And again, I don't have.
So that's. I have other real estate here in Ontario too, with some of the investors that invest with me in New Brunswick also invest here in Ontario. The reason I mentioned that is because my goal is to not have a ton of investors. I rather have a handful of really good investors and use them on multiple properties so that the management of the investor is a lot easier to communicate, to deal with issues and that kind of stuff.
As far as me qualifying, to be honest, you know, I may be able to qualify for one or two, but then I'm just right back at ground zero where I started. And if you remember my five things are, one of them is creating wealth for friends and family. So I figure if I can spread the wealth, then I can do more. And I'm checking the box of just feeling good about making other people wealthy as well.
[00:49:03] Speaker A: Oh, that's awesome. And, you know, you must be having to delegate all this stuff. There's no way that you're doing all this yourself. So you must have some, you know, skills that you've. You've kind of come up with to, like, systems and, you know, delegation strategies.
Maybe you can share a couple of those with our audience.
[00:49:25] Speaker C: Yeah, I think of the who, not the how right is is is something that I really leverage and, you know, building the really solid relationships over the years with people that I can trust. And, you know, obviously there's always thoughts of how they're compensated and making sure that what matters to them is, is.
Is. Is dealt with or is, you know, I want to check those boxes. Being able to, you know, keep your word, keep, keep your promises.
Being able to close on deals, you know, being able to be creative and when things go wrong, finding solutions, tapping into others, finding ways to solve problems has been a, A, A huge factor component of me being able to do what I do from a distance and, you know, systems and processes. I think it's just built really, like once we do it, once we just repeat the process and continue to improve on it. But relationships are a big, big, big component. Like, I was just there a few days ago, and because I'm growing, so are the people that I'm finding the deals from and doing deals with. They're growing as well. So sometimes the growth is all good, but it can seem painful because, you know, some of the trades now are busier than they were before. So now I, it's not as easy as just calling the one, one general contractor or one realtor. I have to expand on, you know, the trades that I have access to and build new relationships that I can continue to grow and we can all continue to grow. So these are some of the growing pains that I go through, but I enjoy because it means that there is growth happening.
[00:51:25] Speaker B: Yeah, absolutely. And where do you see your business going in the future now?
[00:51:31] Speaker C: Right now, man, I'm in the lane of really just continuous. Continue continuing to do what I'm doing with the flips and finding properties that I can hold on to.
There's some development opportunities that I'm looking at, considering learning more about.
But, but right now I'm, I'm, I, I want to continue at the pace that I'm, that I'm, that I'm going with, because I think it's a good pace, a healthy pace, and organically, I think it's going to continue to grow, and I just want to be ready for the growth when it happens so that I can, I can succeed.
[00:52:12] Speaker A: That's awesome.
[00:52:13] Speaker B: And you know what this is like, it's no small feat to go out there to say, you know what, the numbers work for me here, and I'm going to go and get everything put into place so that I can continue and I can. Well, first of all, to start and then to grow. So congratulations on being able to do that and the success you've had.
[00:52:34] Speaker A: I, I know people are going to want to reach out to you based on our conversation. So how do people get in touch with you, what's the best way?
[00:52:43] Speaker C: Best way, I guess right now would be on my website. There's a little bit of technical difficulties where I was kind of. Unfortunately, I'm trying to get that sorted out. But it's, it's growwithcali.com and it can also.
[00:52:58] Speaker A: How do you spell Cali?
[00:52:59] Speaker C: C-A. L I.
[00:53:01] Speaker A: Okay. Growwithcally.com.
[00:53:04] Speaker C: That'S right. And the pronunciation of the last name is Braith. Braithwaite.
[00:53:10] Speaker A: Braithwaite. Okay.
[00:53:11] Speaker B: I thought so. I thought so.
[00:53:13] Speaker C: But I didn't wanna.
[00:53:14] Speaker B: I didn't want to go correcting Quinton.
[00:53:16] Speaker C: It's all good.
[00:53:22] Speaker A: So, so what about socials?
[00:53:25] Speaker C: Social Grow with.
[00:53:26] Speaker B: At.
[00:53:27] Speaker C: Grow at. Growwithcali on Instagram, Cali Braithwaite on Facebook.
And that's. Those are the best avenues to get a hold of me.
[00:53:39] Speaker B: Beautiful. Okay, well, all those, all that info will be in the show notes. The links will be there so you can reach out to Cali, learn more about what he's doing, pick his brain again. Just really appreciate you coming on and taking the time for us today. We've learned a lot, so I'm sure that we'll be able to have you back and learn some more. I know we skimmed through a lot of that. The hour just flies by, you know what I mean? But it was fun.
[00:54:06] Speaker C: It was fun. Thanks a lot, guys. I'm happy to have this outlet to kind of share my experience and hopefully it, it motivates or inspires someone else to. To know that they can do it. The biggest thing that I hear is like, how do you do it over there? And it's not that difficult, but you got to be a good person and when you're good, good things happen, right? So you just be good, treat people honest and fair and do what you say you're going to do and, and have good intentions and good things will happen.
[00:54:34] Speaker A: Oh, very cool. And I appreciate you, you know, coming on and sharing with us. We'll have to get an update from you maybe in a year from now, see where you're at.
[00:54:44] Speaker C: For sure. I'd be glad. I'd be glad.
[00:54:46] Speaker A: Awesome. And Rob, how do people get in touch with you?
[00:54:49] Speaker B: Robisterbreakthrough CA Send me an email if you want to learn more about what we're doing here or if you have any questions at all or just want to reach out and say hi. Robusterbreakthrough CA Quinton, how can people reach out to you and how can they take advantage of that 15 minute phone call?
[00:55:06] Speaker A: They can go to quintindisouza.com and book that 15 minute call, or you can check out durhamrei.comca and join us. We have members all over Canada that join and you know, we do live meetings as well as publish them synchronously online and and record them. So everything's available to our members afterwards. We've got very good speakers back to 2013 where we have recordings, so it's pretty cool.
[00:55:37] Speaker B: All right, well, thanks for that and thanks everybody for listening as well as well. We will see you next time.
[00:55:44] Speaker A: Awesome.
