25% Tariffs or secure the border, Futurization of real estate, where the winds are blowing, that and more on this week’s Truth About Real Estate Investing!

My name is Erwin Szeto and I’m back and almost 100% post pneumonia which was nut fun and a whole lot of phlegm. I’m on antibiotics now and hopefully will be done coughing before our trip to China for a few weeks but don’t worry! The show must go on!

Speaking of show must go on, we hosted a very busy hybrid event a few weeks ago while I was very feverish, weak and from the pneumonia. A couple friends who attended laughed at me not believing I managed to host and present/speak for 30 minutes. Thank goodness CEO of SHARE Andrew was able to carry me more than usual including hosting the post event networking and locking up my office when I went home straight to bed.

I am grateful. Grateful so many, over 180 folks tuned in to learn how to best take care of their financial futures.  Some even shared with me some terrible stories of months of non-payment of rent, one couple bought a house to move into but the tenants won’t leave. 

The majority of us Canadian landlords have little to no rights here and the winds are blowing towards the US but don’t listen to me. My friend at one of Canada’s largest lenders said it.

One friend of mine has under contract a building up north and needs a bridge loan because CMHC has significant delays in underwriting, insuring apartment buildings.  The property is in Thunder Bay so let’s call this friend TB. TB specifically asked if I had lender contacts as he did not want 3rd party brokers to avoid mark ups and fees adding to his cost of borrowing.

Make sense, everyone wants to save.  Now the lender is telling me his commercial division does not have the capacity for sub $10M deals which I found surprising considering how few transactions are being done in the multifamily space these days with rates high, CMHC delays, etc…

He tells me that business in Canada is unnecessarily harder in Canada and investing in the USA is much easier, which has been our experience even though our clients’ commercial mortgage amounts are under $200,000.

No love for sub $10 million vs. we have plenty of options for sub $200k in the USA.  How anyone wants to continue to invest in Canada doesn’t make sense to me hence Cherry and I have begun searching for our 2nd income property in the USA.

But what about the tariffs Trump threatened us with? Keep in mind, the threat is attached to a what if Canada and Mexico do not improve security at our respective borders including the movement of the horrible drug Fentanyl.  Food for thought, I was listening to the Globe and Mail’s podcast and Canada Border Services confiscated 43 pounds of Fentanyl in 2023 vs the US Customers and Border Protection seized over 25,500 points at the US/Mexico border.  That’s nearly 600X more. 

In terms of unauthorized people attempting to cross the border in the US. Canada had 6,900 in 2023. Compare that to 2.8 million at the US-Mexico border, about 405X bigger problem.

Me, I’m going to pop some popcorn and watch how Elon Musk deals with this as the majority of the parts in an American made Tesla are made in China or Mexico.

Fascinating times.

In the end, I’ve yet to see one expert predict the Canadian economy out performs the American one hence my investment hypothesis does not change. My clients are I are buying American, the world knows it too hence pretty much all world currencies are suffering vs. the almighty US$ and many economists predict our dollar may get worse.  Our plan is to accumulate houses over time so we’re average cost basing into real estate in the world only economic, major super power with no sign of peer ever.

I know many talk about the BRIC’s but Russia can’t win a war vs. Ukraine, China’s population is aging like that of Japan and S. Korea.  They’re only hope is to age gracefully, no chance for economic and military dominance like America.

Look to the future, it’s bright for those learning and paying attention.  Speaking of, we have Canadian leaders of technology evolution owning fractional shares of proper real estate including expansion to the USA and at the time of recording, have applied for their securities licence across Canada. 

What that means is investor developers can work directly with Addy without having to engage an exempt market dealer, that’s a firm licensed to trade in securities staffed by well educated folks with letters behind their name who are educated and provide service which comes with a %fee.

Now I’m a Realtor, possibly the most hated professional, I use that term loosely that changes a % commission and who doesn’t like to cut red tape and save a few % points off their investments.  My friend TB in Thunder Bay doesn’t want to pay fees and many others don’t either.

What Addy is doing will disrupt the investing space no different than we at SHARE are using technology to make owning US income properties almost as easy as owning stocks.

This is the future. Owning real estate without having to deal with tenants. Especially that ones with all the rights like they do in Quebec, BC and Ontario.

Democratizing Real Estate Investing With Addy’s Stephen Jagger

Please welcome co-founder of Addy Stephen Jagger, I’m excited to have him, if you haven’t heard of Addy before, it’ll blow your mind.  If you have, the advancements in deal offerings, technology will surprise you along with one of their investment vendors who went belly up.

Oh yeah, this is the truth about real estate investing show so when deals go sideways, I’m going to ask about them, Stephen, kudos to him does not avoid my questions and better yet they’d already publicly addressed them.

https://addyinvest.ca/2024/07/19/strengthening-our-due-diligence-lessons-learned-and-steps-forward/

Or as the saying goes, a ounce of prevention is worth a pound of the cure.  If they’d asked me for a reference check, they could have probably saved a bunch of headaches.

To connect with Stephen:

Twitter: @sjagger. https://x.com/sjagger

Email: Stephen@addyinvest.com

Website: www.addyinvest.com

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.