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Investing in the Kitchener Waterloo real estate market? Read this.

keith marshall talking with policeIt might have something to do with the stock market meltdown. It might be the low interest rates. It might be that the past ten years has witnessed a near doubling of housing prices in Waterloo Region. I don’t know. But I do know that all kinds of people are buying properties for all kinds of investment purposes.

There are an myriad of investment opportunities: University of Waterloo, Wilfred Laurier and Conestoga College student rentals, Uptown Waterloo and downtown Kitchener condos, cottages and recreation properties, real estate investment trusts, and even trailer parks (to name a few).

Investors come in all varieties as well.

The professional investors have it all figured out, maybe they’ve been doing it a while. There are courses you can take, books you can read, experience you can tap into. It’s good if you have a banker or a buddy who invests, because although the rewards can be great, the risks can be even greater.

Being an investor often means being a landlord. As a landlord, it is prudent to have a very detailed lease, and to call past landlords and present employers of prospective tenants. You should spend the money and run a credit check on your future tenants. It is important to do everything you can to avoid bad tenants because once they’re in, it can be nearly impossible to get them out. I speak from experience. Landlord-tenant arbitration is a long drawn-out process, which can take six, eight or more months to evict a non-paying tenant.

But maybe they’re also trashing your investment at the same time, like they did with this investor who rented a bin to get rid of the furniture but filled it with garbage and pizza boxes before even getting to the big stuff.

And then there is liability. There was a newspaper story recently about how insurance companies won’t cover owners for any damages done to homes caused by illegal activity. That means if you’ve done everything right but your tenants burn down your house because they’ve stolen electricity in order to hide their marijuana grow operation, your insurance company probably won’t cover you.

I hope I didn’t scare you. I’ve been investing in real estate for almost twenty years and I know that real estate is a very important (and large) part of my portfolio. I’ve learned some things the hard way and other times I’ve just been lucky. Take my advice and do a little more research before you buy. Talk to your realtor, your banker, insurance broker, take a course, read some books and then you’ll probably be very happy and successful with your real estate investments.

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