Ask Mike

Got a question you’d like me to answer ? Then fire away below! I’ll post a response and may also talk about it on a future podcast or blog article..

If you have something of more personal nature to ask me (not too personal I hope -;) then please use the Contact form instead.

  • Kim

    Hi Mike,

    Are there any resources you recommend for learning about the new construction side of apartment building investing? We own a piece of land and are thinking about building a 21-unit complex on it. Not sure what to expect as far as the timeline goes for returns when starting from scratch like this. Would also love to learn about the best ways to structure things with investors on a more long-term project.

    Thanks!

    Kim

  • Hmm, I don’t know any resources for new construction …

  • Sam Steinmetz

    Hey Mike,

    Love the value you bring to all of us your content is amazing. I got on your spreadsheet for duplexes today for the first time. How do you make sense of the numbers/ returns for the investor and yourself if you barrow the downpayment capitol. Can I customise it or do I need to use the Syndicated Deal Analyser for that? I can see how it would be a no brainer if you were using your own capitol, awesome tool.

    thanks in advance

    Sam

  • HI Sam – thanks for the kind words. The duplex spreadsheet is a very simple spreadsheet, and yes, if you want to do something more sophisticated (like calculating returns for investors), then that’s when the SDA shines. Or yes, you can modify it to do what you want 🙂

  • Quinn Cheung

    Hi Mike (can I call you Mike?). I’ve done flips and have owned MF properties for about 5 years (an 8 unit + a 5 unit). I took a 10 month course on real-estate investing here in Montreal, Canada. I’ve been trying to find the recipe for replacing my 9 to 5 job income with real-estate investing (as you promote vigourously in your podcasts). What you preach in your podcasts may work in the U.S., but VERY difficult to do in Montreal and even outlying areas. With what MF properties cost here vs. their income, there is typically very little to NO cash flow at all from these buildings – the profit only comes from mortgage paydown (so equity) and the theoretical increase in value. With hardly any cash flow at the end of the month, not only do I have to stay at my day job, but when major renos need to be done I have to finance them out of my own pocket (which in fact forces me to keep my day job, doesn’t it?).

    The price vs. revenue problem is compounded by the fact that the laws in Quebec governing landlords/tenants are EXTREMELY biased in favor of tenants due to legistlature that was passed in the 1970’s when there were barely any laws at all and it was the landlords who were abusing tenants. As such, when a tenant stops paying it takes between 3 to 4 months to evict them (which is all lost rent). In one of my worst years, I lost 19% of the annual income in unpaid rent on one building, none of which I will ever see even if I go to court to chase after the tenants because of the laws here.

    I would like to see some concrete examples (the numbers) of properties in areas of the U.S. that allow people to pull out positive cash flow after expenses are paid. I am open to investing in the U.S. if the numbers make better sense than here. Here is one typical example of a property in Montreal an agent sent me this week (all costs and income is per year):
    10 units
    revenue: $75192
    energy cost: $400
    city taxes: $9363
    insurance: $3700
    financing: 2.8% over 25 years
    asking price: $1.3 million
    Are those the kind of numbers that would allow someone to quit their day job? Are there areas in the U.S. where properties are more profitable? Do you think that what you promote on your podcasts only applies to the U.S.?

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