7-figure losses, Anti Renoviction By Law in Toronto $1 trillion passing from boomers to millennial kids, and new federal government programs for developers—all this and more on The Truth About Real Estate Investing Show for Canadians! My name is Erwin Szeto. I’ve been a landlord since 2005, a dedicated investment property specialist Realtor since 2010, with close to half a billion dollars in transactions and I can count on my one hand how many pre-construction condos that includes as I’ve never been a fan. I’m a 4-time Realtor of the Year to Investors in Ontario, and since 2016, I’ve conducted over 300 hour-long interviews with Canadian real estate investors on this podcast.

Over the years, I’ve developed a few personal, immutable laws of real estate investing:

• I don’t private lend.
• I don’t joint venture.
• I don’t invest with novice investors.
• I don’t borrow at expensive rates.
• I don’t invest in small towns with poor economic fundamentals.

It’s too much risk and effort and friends of mine were recently burnt.

I have friends who lent to a high-profile investor with projects west of the GTA and in Florida. If you check this investor’s Instagram, you’d think they’re living the dream: mansions, an enormous Muskoka cottage, flying private, six figure luxury car, private school. But behind the scenes, they’ve lost millions of dollars, including a few 7-figure private mortgages from my friends. Confidence is low that any of that money will ever be recovered. Some lenders are posting about it on social media as a PSA so others don’t lend to this investor.

One friend has since taken over several of these failing projects. This highlights one of my biggest hurdles with private lending: I want my investments to be as passive as possible. I genuinely enjoy my work and value my time with family. But when private loans go bad, Plan B is usually to take control of the project—forcing a sale. That often means getting hands-on and coming out of pocket to fund working capital or pay off other creditors ahead of you.  Cherry would murder me if this happened hence we don’t lend or JV with others.

And what if the market is like it is today? High interest rates, low buyer interest, and lacklustre projects. Plan C then comes into play: litigation and/or heavy involvement—managing development, renovations, contractors, or even running the business, like a hotel or recreational property. For my friends, many of these properties are in small-town Ontario, requiring long, inconvenient commutes to places I’ve never even heard of.

It’s a sad situation for everyone involved including a group of investors having to power of sale a portfolio in New Brunswick where they replaced their Conservative government after SIX balanced budgets and elected a Liberal majority that promised a 3% rent control cap for next year. At least that’s better than Ontario’s Conservatives, who set the cap at 2.5%—the lowest in Canada. Socialism seems to be growing here which is bad news for investors.

Admittedly, I’m not immune to losses either. I’ve lost money on many things, and anyone who claims they haven’t is lying. Personally, stock tips have been my Achilles heel, leaving me with financial PTSD from owning Tesla stock and adding to my Bitcoin. Compared to that, losses from tenants trashing my properties or not paying rent feel minor which is closer to $50k over my career. 

Lessons learned: stick to what’s stood the test of time. For me, that’s long-term real estate investing based on economic fundamentals and cash flow. Just not here but rather in the US because… 

The City of Toronto just passed a renoviction by law so if a landlord needs to evict a tenant even temporarily to complete a renovation, the permit is $700 per unit, proof the unit would be uninhabitable during the renovation and rehome the tenant who is being temporarily displaced with comparable housing a similar rents or monies to cover the rent difference.

Hamilton and London, ON also have passed very similar renoviction by laws and I predict more municipalities will pass similar legislation.  With so much old housing stock in those three cities… I don’t envy those landlords… 

Next week I’ll tell you what the Ontario liberals have planned: no rent increases and no evictions for landlords’ own use including a buyer who’s going to move in in 2025.

What’s a real estate investor to do?

For those interested in learning more about what I consider the best practice for investing in real estate, I want to personally invite you to a FREE hybrid training, How Canadians Can Leverage U.S. Real Estate for Passive, Scalable, and Tax-Efficient Income Streams on Thursday, November 28th, doors at 7:30 for in person, 8 PM EST online. Here’s what you’ll learn:

• Where to invest & capitalize on a Trump government
• How our clients are making money on the buy
• Executing perfect BRRRRs without leaving home
• Diversifying to USA for better cash flow and returns and landlord rights

👉 Save Your Free Virtual Seat

👉 Save Your Free In-Person Seat

$1M Losses, NEW Federal Gov’t Lending For Developers w/ Pierre Paul Turgeon

Now for those of you with deeper pockets and want to be developers closer to home, we have my old friend Pierre Paul Turgeon returning to the show.  A former industry insider as an underwriter at the CMHC, active investor, and real estate expert in the apartment building space, who has analyzed 100s of large, lucrative multifamily investment deals all over Canada.

As a good Canadian, Pierre Paul wants to help build more housing and believes it is developers in Canada who have the greatest potential for success and he’s here to share about the latest Federal programs for developers no one is talking about. I’d never heard about these programs so if you’re a developer, builder or plan to be, you’ll have to give this episode a listen.  Developers are who the federal government wants to support because they build housing we so desperately need. Landlords? Not so much. 

To connect with Pierre Paul, email him at  ppturgeon@maoki.ca

Or his website www.multifamilyinvestingcanada.com where he offers free resources and a paid, in depth detailed courses on apartment building investing.

Please enjoy the show!

To Listen:

HELP US OUT!

BEFORE YOU GO…

Before you go, if you’re interested in what kind of properties I am looking at in the landlord friendly states of the USA please go to iwin.sharesfr.com for what I consider the best investment for most Canadians, most of the time.

I’ve been investing in Ontario since 2005 and while it’s been a great, great run. I started out buying properties in the 100,000s and now it’s $800,000 to $1,000,000.  How much higher can it go? I don’t know

To me, the remaining potential for appreciation does not match the risk hence I’m advising my clients to look to where one can find rental properties that are affordable range of $150,000 to $350,000 US$, with rents that range from $1,400 to 2,600/month plus utilities.   As many Canadians recognize, these numbers will be positive cash flow and are night and day compared to anything locally. Plus the landlord has all of the rights, no rent control, and income is US dollars which are better than Canadian dollars.

If you don’t believe me, US dollars are better than Canadian dollars, go ask 100 non-Canadians which currency they prefer to be paid in.

So to regain control of your retirement planning.  Go to iwin.sharesfr.com and check out what great cash flow properties are available in the USA.  

The best part is, my US investments will be much more passive compared to by local investments as I’m hiring an asset manager called SHARE to hand hold me through the entire process.  As their client and shareholder, Share will source me quality income properties, help me with legal structure and taxes, they manage the property manager and insurance provider while passing down to me preferred rates so I save both time and money.  

Share will even tell me when to strategically refinance or sell.  SHARE can even support investors all over the country for proper diversification hence my plan is to own in Tennessee, Georgia, and Texas.  Share is like my joint venture partner but I only have to pay them fees while I keep 100% ownership and control.

If your goal in investing is to increase cash flow, I don’t know of a better strategy for most Canadians most of the time.  One last time that’s iwin.sharesfr.com to see what boring, cash flowing real estate investing can look like on your path towards financial peace.

This is how I’m going to make real estate investing great again for my family and hope you choose the same.  Till next time!

Sponsored by:

This episode is brought to you by me! We don’t have sponsors for this show. I only share with you services owned by my wife Cherry and me.  Real estate investing is a staple in my life and allowed me to build wealth and, more importantly, achieve financial peace about the future, knowing our retirement is taken care of and my kids will be able to afford a home when they grow up.  If you, too, are interested in my systematic strategy to implement the #1 investment strategy, the same one pretty much all my guests are doing themselves, then go visit www.infinitywealth.ca/events and register for our next event.

Till next time, just do it because I believe in you.

Erwin

W: erwinszeto.com
FB: https://www.facebook.com/erwin.szeto
IG: https://www.instagram.com/erwinszeto/

Disclaimer:

As a committed advocate for transparent and responsible real estate investment, I want to openly share my involvement with SHARE SFR (Single Family Rental) as an Advisor. I hold an equity position in this company and receive a referral commission for clients I introduce to their services. My endorsement of their business model – focusing on direct ownership of positive cash flow income properties – is consistent with my own personal investing since 2005, is based not only on a professional assessment but also on my personal experience and belief in their approach. Please note that while I stand behind my recommendations, it is crucial for each individual to conduct their own due diligence and consider their unique circumstances before making any investment decisions. As always, my priority is to provide you with honest, insightful, and practical real estate investment education.