**Transcripts are auto-generated.

 

Erwin  

Greetings, everyone. Welcome to another episode The truth about real estate investing show. And there is literally so much going on in the world right now. And what often comes back to me practising gratitude that I am Canadian. If you don’t believe me, ask our friends or ask your friends and we’re a family in China, Pakistan, Sri Lanka, Russia, Ukraine, and of course, even New Zealand. If you can believe it, New Zealand, a country with a population of only 5 million people has a higher average house price than we do here in Canada, hence, they’re experiencing massive brain drain people are leaving the country, talented people are leaving the country. And that’s usually a bad thing for an economy when smart people you know, for example, like doctors and leading entrepreneurs when we’re taking their talents and their job creation elsewhere. That’s bad for an economy. Hopefully that hasn’t happened here in Dublin, Ireland, over 100 people waited outside in line, a house for rent one house, there’s my house for rent 100 people waited outside to view the house thanks to inflation, rising interest rates in the inability to raise rents to match rising costs of living thanks to rent control, Ireland serves as a sneak peek into what we may run into as we to operate under rent control. And hopefully this is not a feature we have to look forward to, in Ontario, in Canada might imagine anywhere else, where there’s rent control, and rent control provinces with lots of growth. You know, like BC, for example, like Nova Scotia, for specifically for Ontario, the smart Prosperity Institute just produced a report stating that the housing shortage in Ontario is 471,500 units. 471,500 units is how much the current shortage is. And 1,034,900 new units are needed to keep up with demand over the next 10 years, for a total of 1.5 million units. So we need 1.5 million units to be built over the next 10 years. Unfortunately, the government also paid for a study to be done. And there’s only going to be 700,000 new homes to be built over the same those same 10 years. So again, this is revisit the supply versus demand demand is there for 1.5 million. And supply is going to be less than half of that as 700,000 new homes to be built over that those same 10 years. Of course, the news really gets worse because if you’ve been following the news and speaking to builders like I do, I understand I’m friends with lots of builders, and who are part of builders associations, you’ll know and also it’s in the news, you know that many projects are being paused, delayed or even cancelled. So even less housing based on the current news is being built. There’s lots of unknowns going forward. However, here at iWin real estate, my coaches and I are staying on top of economic data. And that’s proven really helpful. I’ve mentioned a few times on the show, we haven’t had any clients with experiencing closing issues, because a lot of things they just worked out that we did. And it’s nothing like we’re seeing out there in the market. For example, we’ve had lawyers on the show, who described their regular retail consumer type real estate clients are having all sorts of problems closing on property, their appraisals are not coming in, and they’re not able to close because they don’t have they cannot come up with the downpayment necessary to come up with it for the shortfalls and appraisals, since the market has dropped. But anyways, we’re staying on top of things here. And thankfully, it’s worked out really well for ourselves and our clients. I’ve mentioned before that Terry and I, we ordered our appraisals on our properties for our refinances back in February. And thankfully that worked out that timing worked out very well. I’ve also been talking to people like my neighbour who works for a major consumer products company, they distribute and sell many products you have in your home, he specifically works in supply chain management, from what he can tell the Americans are about four or five months ahead of us in terms of economic terms, as in, their consumption is down, they’re buying less. You’ve also been well, if you fall, I like to read articles on corporate earnings. So for example, Walmart, their sales are down as well. People are consuming less instead of the article. She the CEO mentioned how they’re seeing sales down on, for example, four gallon jugs of milk are being replaced by sales of two gallon jugs of milk. So people are downsizing but they’re buying anyway. So the numbers don’t look good. The Americans are likely to four to five months ahead of us economically. And the theory would be is because they only like half locked down versus Canada as a whole country locked down pretty good. So they’ve had they’ve had more freedoms. So Canadians are still consuming heavily right now. So that’s my own experience. I was just in Blue Mountain Village and up north very popular recreational resort style area in north of Toronto, and it was absolutely packed A parking lot was packed, the hotels were packed, the restaurants were packed, the bars were packed. My point is, is that because Canadians were locked down, we’re taking that we’re taking our time now to enjoy our summer enjoy our freedom. And then my guess is in a few months time, we’ll start seeing Canadians start consuming less, you know, because stuff is expensive, might start seeing some pain in terms of job losses, for example, for just announced 3000 job cuts this week, they’ll mostly be in North America, Canada, USA, and I don’t see how we as Canadians avoid a similar fate. But please understand, I’m no fear monger. I do fear in the short term. But I’m bullish in the long term for real estate, am I investing and my stocks and my crypto I don’t most of all of its down this year. Hence, my team and I will be summarising all of our research and how we and our clients are taking action on this current market. Some are selling, some are buying. We’ll be sharing what deals look like in this market, and to prepare and also how we’re doing what we’re doing to prepare to weather the current storms. And we’ll share our own predictions for interest rates, where the market will be going in the short term. At our September 17 Ioan meeting, this will be a first time meeting since our summer break. So we have tonnes to share on what income properties are selling for why certain properties are taking longer to sell what the rental market is doing. Hence, this is a meaning you do not want to miss will be trying through the clickbait and the Bs by sharing what we’re doing with our own money and what our clients are doing with their money. And that’s all on September 17. At our island real estate office here in Oakville. Same place, same time, it’s a Saturday morning, so traffic’s been nil. The doors are open like 830 ish, there is no online option. You do not want to miss it. Understand that this market is the wildest I’ve seen. And I predicted early on that we could easily see 2017 happen all over again. But 2020 is making 2017 look like a speed bump in the road. I think 2008 2009 is a close comparison to what we’re seeing. I don’t think it will be as bad based on what I’m reading from the top economists in the world, and top economists in Canada. And to be honest, we invested back then we did quite well, we did more than survive this cycle. And I think we’ll do more than survived the cycle as well. On a personal side, I’m now volunteering at our local Brazilian jujitsu club during my kids class, I must have ADD, as I have issues sitting around and watching classes, then the problem got worse as we parents were asked to wait outside the amount of class area. Yeah, so it’s a poured beer for parents to do a bore parent, such as myself where he spends too much time on their phone. So what I decided to do was I bought a uniform, and I volunteered. So now I’m an extra set of hands and eyes and ears to make sure the kids don’t hurt themselves. Plus, you get to observe the instruction or close and provide some pointers to the kids. The best part is I’m learning the curriculum, so I can practice the kids outside of class and you know, have more in common with them and spend more time with kids as I honestly work enough as the kids seem to dig it so far. So I’ll guess I’ll keep this up until they’re sick of me. Oh, by the way.

 

Erwin  

Our our September 17 meet up. Link is in the show notes. If you’re on our emails or you follow me on social media, you’ll get the link you’ll see the link there to purchase tickets, clients, of course you go free onto this week’s show. We have with us a young rock star and just stanza who was 24 when we met 24 years old when we met and the owner of the title of the youngest client we’ve ever worked with. He’s young Hustler, who when I met him, he had three jobs. He is an architect by trade. So that was his day job, bartender for evenings and weekends, and a landscaper with the remaining time he wasn’t sleeping. Thanks to all that hustle and saving money by living home with his parents Young Joe saved up enough money for his first investment property. That was back in 2019 January 2019. And now he has five investment properties. Crazy enough he’s made his first million is actually about a year ago, he crossed the million dollar mark in terms of increased his net worth. Hence he’s also the owner of the title as the youngest of our 45 self made real estate investor millionaires of age of 20 I think it was 27 at the time anyways, if someone challenges him will will will sharpen our pencils and figure out the exact age of Joe. Joe is here today along with coach Coach Tammy from the AVID real estate team, my team to give us an update on his expansion project how that went in Sudbury when he was looking for diversification and his lessons from it not going so great. But you know, Joe’s smart and talented hands he bounced back pretty well. He got a gem of an expired listing and Hilton, that coach Tammy helped Joe with that was eventually priced well under market because the property failed to sell. It was rough later found a hole in the roof that could fit a soccer ball through and a challenging tenants with previous orders against them from the landlord tenant board. We talked numbers on this most recent on this most recent deal so have your pens and calculators ready or email us at Iowan at infinity wealth.ca And we can send your coach Tami’s draft numbers. Please enjoy this show. Okay, Joseph what year to be me?

 

Joseph  

2019 2019 you’re how old 24 When we met once you 23 Then turn 24 Once we bought four and then I turned 25 Okay, so

 

Tammy  

you wanted January 2019? Yeah.

 

Joseph  

Yeah, right after New Year’s that whatever that first event that you put on.

 

Erwin  

That’s big event. That was the one on the hill, Shawn Allen for referring you. Yes. Yes. Thank you, Shawn Allen.

 

Joseph  

I was going to like networking events and stuff like that. Prior but Sean’s lives in London. He was doing a networking event in Toronto we loop buyer Byron says by thing I can always always mess it up.

 

Erwin  

Your European

 

Joseph  

I can’t roll in our for my life. Didn’t matter. How’s your Italian? A horrible absolutely horrible my mom is very upset with

 

Erwin  

is your Italian better than his? Yeah,

 

Tammy  

probably my probably better than yours. And I just married one.

 

Erwin  

That’s the show is going off the rails? Why were you going to real estate meetups you you had at the time you had a career in your training. So you’re already making career wise as much money as you could?

 

Joseph  

Yes. But I think I was kind of looking to I don’t really know what I was looking for it to be honest with you. I had a few things that I wanted to I had a lot of money saved up

 

Erwin  

from that wasn’t that much money. It wasn’t more than to notice a lot of money to me. It

 

Joseph  

was a lot of money for most 2423 year olds. It was a lot of money for Yeah.

 

Erwin  

$80,000 Yes. That I worked very hard for but listen to your credit cards now. Yes. really different. Yeah, that’s fair. Yes. It was a lot of money.

 

Joseph  

Yes. Life Saving at the time. It was like my life savings.

 

Erwin  

Yes. But you blood and sweat it before since you were 16?

 

Joseph  

No, like more like right after more like after school kind of thing. Okay, but like still like working two three jobs study

 

Erwin  

for it. You basically never had to date your life. No. Until oh, gee, until real. It’s all downhill from there. To your parents. Yeah, they got you good. till you’re 24 to get debt free. And the new meta Yeah, exactly. Exactly.

 

Joseph  

Yeah, no, I just wanted to kind of I wanted a little bit more for myself. I wanted to have a little bit more ownership of something. And I think the initial plan like in all honesty, the initial plan was to take the 80,000 by Tesla. Yes. Because the shares, right? No, Tesla Tesla car okay, but I don’t know what changed it. I think I had listened to a few episodes of bigger pockets or something along those lines. And that got me hooked up my show. No, I’m sorry. Sorry. I found you later on. I’m sure it all down here. Yeah. And then that kind of got me into it. Rich Dad, Poor Dad, my kind of dad went through pretty traumatic kind of heart attack experience. And then that kind of shifted from there. It was just kind of like I need to do something about this. And that was kind of like November of 2018. And then I started going to like a networking event every every other week. And then stumbled on to Iowa and grew up from there.

 

Erwin  

Like your yada yada your your father’s health scare.

 

Joseph  

Yes. Heart attack.

 

Erwin  

Why was that a trigger for you to

 

Joseph  

he thinks simultaneously as he was having as he had a heart attack I was like really deep into the weeds of reading Rich Dad Poor Dad and cashflow or not cash, not cashflow. tribit and Cashflow Quadrant and all those other books, and kind of still listening to real estate podcasts and stuff like that. And so I think he would just like the connection of the two and just that was just that I was just, I was hooked after that. And it’s always something I’ve always really wanted to do too. Like he’s always really like this like not necessarily in the investment side. But just like real estate in general has also been has always been like a something that really intrigued me. So it kind of took over from there was a

 

Erwin  

kind of, it’s not uncommon. We’ve actually had a lot of people on the show where a major life event usually with their parents that got them really going like really crank the crank up the temperature on their want to hustle to do more quickly. Was it just like you realise like Life is short?

 

Joseph  

I think. Definitely a little bit of that. I really don’t know, I never really I didn’t really take much time to think about it. It was just like, I’ve always been someone that was just like if this one needs to get done, I do it. I don’t really have any second thoughts about it. I just, I’ll learn as I go. So I’d really didn’t learn take time to learn that much about real estate before just jumping in, had the money to it’s not like I was like had to save up that much more to have all the money. I didn’t have all the money but

 

Erwin  

as you didn’t just have not not have all the answers. You didn’t have all the money.

 

Joseph  

But I think I’d have been exposed to real estate or a younger age through a series of different kinds of people in my life and that kind of helped to kind of make the job into it. Yeah,

 

Erwin  

the finding the money piece you actually detailed more now, just a year ago, the last episode. But unfortunately for you, we’ve gained about four listeners, I’m sure like both from 13 investors now to 17. So we need to, we need to spend some time to bring the other four listeners up to speed. Got it. Okay. We did that for them. Hopefully that was worth your time. For listeners will be appreciate that we brought in Georgia to we spent some time to bring you up to speed. And if you’re interested, go back and listen to the episode with George Costanza. This is your third time. Fourth time

 

Joseph  

fourth time. Yeah, we’ve we’ve done a yearly update every year since I started.

 

Erwin  

Okay, so what’s keeping you busy these days? Well,

 

Joseph  

in the next few weeks, I’ll be going to Greece. So that’s really been kind of doing a little backpacking trip for myself in Greece, just I needed a vacation. Yeah, I needed something just for me. I’ve really spent like the last four years really haven’t gone on anything major. A road trip here there been like nothing overseas or anything like that. So I just decided it was time to like treat myself. Um, besides that I’ve been in the last kind of five to six months been liquidating some assets and whether it’s in crypto or in or real estate to kind of make room financial flexibility for the market right now. And to kind of start taking advantage of the market in the kind of the next few months is kind of my projection. I don’t know everyone’s different. But that’s kind of what I’m feeling out right now. So

 

Erwin  

what did you sell off real estate wise,

 

Joseph  

I sold ours. I

 

Erwin  

know, we haven’t sold anything in Hamilton.

 

Joseph  

I have not sold anything in house firm. I’ve we’ve actually recently purchased something in Hamilton. But I sold off a property that I purchased in February, there was just a bunch of stuff that was going wrong with it. And so I decided my budget, my money was better used somewhere else than in something that wasn’t making them money or it wasn’t I didn’t have any sort of time horizon to start making money. And so it just made sense to kind of liquidate and move on to transition those assets into something else.

 

Erwin  

So what got you into Sudbury? What was what was the month? But because this is about 12 months ago? What was when you get inside?

 

Joseph  

When did I get in? Must have been March? It must have been? No, it was February of last year,

 

Erwin  

February of 2021. Yeah. What were you going through

 

Joseph  

a series of reasons I actually really liked the city. I think it’s a great place for investments. But I think the approach that I had was wrong, but that’s a different conversation. I went there just more for the from the cash flow perspective. Hamilton wasn’t cash flowing the way I wanted it to

 

Erwin  

cash flow if anyone wants to do more, more is always the answer. Yeah. How much cash? Would you like more?

 

Joseph  

That’s fair. That’s fair. No, I just wasn’t cashflow in the way I wanted it to. And I was trying to find a market that would cashflow a little better for me. And I liked the kind of future prospects of Sudbury with green energy becoming a major player in the space and having so much nickel up there and whatnot. So it was I think it was more of a nickel play, to be honest with you than it was a real estate play isn’t wrong. No, there was nothing wrong with it nice to actually really liked the city. Like I still have a property there right now. But the it just the renovation that I was doing there wasn’t really going the way I wanted it to. And so I just decided that it was time to kind of cut ties.

 

Erwin  

So this is a trick about real estate investing. It’s not always rosy sunshine and roses, is it? No, it’s not. So where did you find this contractor that didn’t go that went sideways? Fantasy coaches and legal troubles didn’t?

 

Joseph  

Oh, yes, we’re still I’m still dealing with the legal troubles actually, right now. So yeah, not not fun. Do not recommend it. But yeah, I found them through the network kind of through through people that I’ve met down there.

 

Erwin  

Sir, I’m sure.

 

Joseph  

Since found out that there was people kind of certain connections that I didn’t make at the time, that kind of may have changed my opinion about hiring a certain individual or certain company. But nonetheless, I tried to look at it more like a like a lesson rather than a mistake. Right? And so I’ve been really, over the last, probably the last, I’d say five to six months and really kind of analysed since we’ve kind of since I decide to sell it really analysing what What mistakes did I make and how do I avoid them? And how do I kind of improve my process going forward? Whether it’s in the hiring process, or in the vetting process? Or how do I really kind of iron out and don’t have these, essentially these these issues that came up from from this one guy? And it seems like it was just one thing after another with him and that was a complete fault of my own for maybe not vetting them properly.

 

Erwin  

Yeah, there’s a lot there though. Yes, great. Responsibility. Part of like taming I do is we also take responsibility for referrals we make again Oh, I know, I can think back to one contractor that’s had legal issues with our clients. And I’m we’re getting on the phone with him and yelling at him. Like you’ll never yeah is pretty. I’ve never yet I

 

Joseph  

almost haven’t seen you. I pretty much

 

Erwin  

never yelled in the business transaction in a business relationship. Right? I’ve had issues with other realtors and stuff like that. And yeah, people on my team, but still professional, because I still need things to progress. Right? We still need to keep it professional. But yeah, that Jeff guy yelled at him. And he just lied his teeth and everything. So the people that the folks that made the referral to you to general contract, did they? Do you have an escalation point?

 

Joseph  

Did I have an escalation point. And so

 

Erwin  

I got from corporate world, right, it was a big blue for seven years. So if someone in the company, if I’m working someone in the company, and they’re not doing what they said they’re supposed to do, I go to the boss, that’s just how it works in corporate, right, like for when we intervene and make referrals, we’re not their boss, but we’re often their number one referral source. So there’s some accountability there, we have some leverage in the relationship. So if our clients not happy, then we make the phone call, and let them know, we’re not happy that our clients unhappy, right? And then they know, because of our business relationship, like where basically, they don’t have a marketing budget because of us, right? They don’t have to go find clients, because we were making all the refer to we bring them clients. So if they want that St. Say stream of clients to continue, you have to make my client happy. And that’s often not hard. We’ve had many folks come to us because I like working with our clients. So what my question is, like, was there is there an escalation process? Because with us, absolutely is

 

Joseph  

in there? Yeah, there definitely is. I mean, like, even when I have issues, if I have issues with a renovation that I’m doing in Hamilton 99% of the time, it’s coming from you or someone else that is in the group, and it just in through conversation, like it will call each other talk to each other. And it’s like, oh, what’s like, what’s going on with this property? Oh, this going on? Not really happy with this. But we’ll get there. And then all of a sudden, that problem is fixed. And I call Tammy, I’m like, what would you say? Like, why are you what what’s going on? Why you’re getting involved. And but it just is nice, because it was like it was always like there was someone there kind of watching out to make sure that everything was going smoothly. Besides just me, I didn’t have that same experience there. And not to say that there was anything particularly wrong with it. I just didn’t have that. I think coming from an experience here with the group that you’ve put together, where everyone’s kind of family and everyone kind of works together to help each other out. There. I felt it was a little bit more lone wolf. more basic. Yeah, yeah. But just there wasn’t a network that was set up that is set here. And so I think just through a fault of my own knots, assuming that the process would be very similar, I didn’t do probably a well enough job of kind of understanding what needed to be done at the time.

 

Erwin  

But and what your experience isn’t different than what was No, I

 

Joseph  

imagine, most people have a similar experience, if they’ve had a contractor relationship go south,

 

Erwin  

like most Realtors offers offer basic services for join a search, they can book your showing appointments, open lock boxes, you know, ask you if you’d like the property or not, right, prepare all the paperwork and stuff like that, you know, it’s just for Tammy and I, we this is how we’d like to like to be service. Like as realtors, we’re paid a lot of money. Right. So I think a high standard of care is appropriate, including yelling at your contractor, if we have to call him threatening their business.

 

Tammy  

You know, I don’t even the vetting processes, it’s can change. And you have to roll with a little bit too, because, you know, even the contractor that we had, where things had went south, we had multiple people working with that person who had success as well. So it was really hard to know. And sometimes those things happen. So I think a big thing is to know when to recognise it, and when things need to be addressed and fixed or walked away or that kind of stuff, which you know, you did afterwards. I think that was that’s important too. And to know that it’s okay to walk away sometimes from things as well. failures. It’s

 

Joseph  

yeah, that was that was probably the biggest challenge for me was walking away, not because it wasn’t a smart financial decision, because I made money on on the sale. It’s not like I didn’t make money on the sale, even though we were only halfway through the renovation. It was I think there were a lot of it was there was a lot of ego involved. I was really kind of caught up in what is my image? And what does it look like if I quote unquote, fail? Yeah. And that held me back. So these issues are coming up back in November, and I realised that we close in August, renovation started mid August. And by the time November hit, I kind of taken like a month away and my brother’s wedding was in October and it hadn’t really gone up for like probably about five weeks. And then I started going up pretty consistently in November. And there was no progress made since mid September. And so I was going up every single week to and no progress was being made every week. I mean, like maybe one thing here or there but like in all honesty like I do more on weekends at my property than this guy did in the whole week.

 

Erwin  

And they have a crew.

 

Joseph  

He has a whole crew exact, and that’s his only job. Yeah. So that’s how they make a living. That’s not how you make a living.

 

Joseph  

Right. And so I think I kind of got caught up for probably about two to three months, not wanting to sell more from an ego standpoint. I wanted to, but a lot of it was I wanted to push through for myself, I wanted to kind of overcome the obstacle. But the thought that was rolling through my head is maybe it’s better to sell, maybe it is a good time to sell. And I was really battling with it. Like I was researching prices, what can I get for the property? What would be? What would be my exit? How much kind of leeway do I have before I start losing money on this deal? And a lot of not wanting to sell was because I didn’t know, I was worried about how people would see me. And then I think I think it could have been a conversation that we had over the phone at one point. I think you mentioned like your like you mentioned something about, it’s okay to make mistakes or we. Yeah, exactly. And it’s okay to kind of let go if something’s not working out,

 

Erwin  

like my crypto stocks. I wonder if you’re talking about? Sorry,

 

Joseph  

no one I sold some crypto to back in February. Yeah. And so I think realising when I finally came to terms with it’s okay to kind of make them realise that you’ve maybe made a mistake. And that the important thing is how do you adapt from that mistake? How do you kind of manoeuvre when you have made a mistake. And so looking at the property, not really seen a time horizon when this renovation would be done already firing the contract or having nobody out there, I realised my money was spent better somewhere else. And so keeping it in what I would call a dead asset wasn’t really an option anymore. And so that’s when we kind of started the process of selling.

 

Erwin  

Thank goodness, you didn’t lose any money.

 

Tammy  

That’s what I was thinking.

 

Erwin  

It was tough. It’s tough when you’re losing money in real estate, because it’s leveraged.

 

Joseph  

I can. Well, that was that was, I think that was the biggest fear. I mean, we’ve had the conversation, I think I’ve had conversation with both you guys about that particular situation we had went to sell it and then two days was coming down and market was, at the point when we were selling it was beginning of March, we just have that huge run with February, I had sold it at a premium price off market was gonna make a good amount on it wasn’t really upset about it a day before we closed, he put a lien for basically the full price of the contract that I have already paid him 50% for. And so that kibosh the deal. And for the next kind of three months, I proceeded to hold the property while the market was falling God. And we did some legal manoeuvres to be able to sell the property. And then luckily, the same buyer was still interested in buying it. And I said, I’m only selling it to you if we’re selling it for the same price. And they said that’s not a problem. So I lost a little bit in the holding costs. And then they got a realtor involved to make sure that they were secured. So I lost more than I would have gained if I had sold it back in February. But all in all, it wasn’t a loss.

 

Erwin  

Well, how would you rate your stress on

 

Joseph  

this deal? Oh, very high. Very, very, very high. I think for about three to four? No, probably since October from August to April of this year. I don’t think I slept very well down. Yeah, that was a long time. I’m doing I’m doing a lot better now. But so that’s all it matters.

 

Erwin  

And how far was it the drive?

 

Joseph  

Average out four hours, four hours each way? Okay. Depends on how you drive really like three. But if you stop for lunch and stuff like that three each way. Oh, mine the drive. I think there’s there’s a lot of young people here. But if you have kids, and you’re doing this, but I think there’s a lot of young people who don’t have a lot that they’ve saved up where their time is not worth as much. And that drive may be worth it for them to go out and buy a cash flowing asset. Because they may not be able to afford anything in the GTA and I think that’s fine. I just think you need to approach certain areas with certain strategies, you

 

Erwin  

can just partner with you. They don’t have to do everything themselves. That’s fair. Yeah. This this whole thing, like people like opposed to partnering, because I’m like, I’ve told I’ve told him to the family, you know, before the pandemic, for example, I was like, I have like cousins, so their brothers and like, you know, you too can buy like a 4000 square foot house for like under 3 million, versus you’re both gonna go spend about 1.5 and have way less square footage.

 

Joseph  

I think a lot of people like the pride of ownership, especially something is just there’s

 

Erwin  

I have a small ego some days. Money has been cheap. Yeah, I have no limit.

 

Joseph  

I would agree with that.

 

Erwin  

So it’s actually been it’s been in the news lately. Really? How bad friends are for example, Well, that’s why the only way for an average Canadian to afford rent is to share two bedroom with somebody. Yeah, for sure two bedroom apartment someone so I don’t know understand to me there’s no difference why two people when co venture on a property, right for me, I’d rather co venture with someone and buying like Hamilton an hour away versus four hours away. Right? And then I can divide the work down the middle. It doesn’t have to be Hamilton, it can be Oshawa, it can be Barry, whatever, right? My point is, I don’t wanna drive over an hour. And again, if I partner with someone, we can split up the work, you do the maintenance, I’ll deal with the tenant type stuff. You know, I mean, that kind of division. We don’t see that among our clients. You’re typically married couples, where one partner deals with a tenant that one deals with the tools and the maintenance. Right. So I don’t see why two people who aren’t married can’t do that.

 

Joseph  

I would agree. I don’t have anything to add to that. I think you’ve said it. Well,

 

Erwin  

wow. time you see something you

 

Tammy  

JV with Joe? No, it’s true, though. It’s it? No, it is good. It is good JV with Joe

 

Joseph  

coined a new term. To get

 

Tammy  

into the market, though there is a lot of people or maybe that you’re established or maybe some people can get on title. Some people can’t like it is a good good way to get in the market for a lot of people. No 101 was a JV as well.

 

Erwin  

And we have clients like just buddies who got together and bought a house

 

Tammy  

and mobile JV later, I mean, but what’s wrong with JV in first two, right? Yeah,

 

Erwin  

as long as our hard working people, like your hard working folks and hard working people,

 

Joseph  

I think it also comes down to what is both parties bring to the table, and like sometimes just the typical money, right, like the money partner and the working partner or the active partner, that relationship works, but sometimes you also need like, it depends on the size of the deal and the type of deal, like to active partners can be just as beneficial. But yeah, I see no issues with partnering. I’m actively kind of bringing on partners and looking for partners and and speaking with people about partnerships all the time. Yeah.

 

Erwin  

So the separate properties having a headache.

 

Joseph  

Yeah, your first one went well, the second one didn’t go so well. Okay, and you’re keeping the first one. It’s I’m keeping it there for now. A cash flow is fine. I don’t have any headaches. I haven’t driven there in six months.

 

Erwin  

Is it still there?

 

Joseph  

It’s it’s yes, it’s still there. So it’s just if I ever need to liquidate something, it’ll likely be the first one that goes.

 

Erwin  

So this is February 2022. Would you would you liquidate it, or do you keep it

 

Joseph  

if I knew what the market would have done right now? Yeah, I probably would have liquidated I kind of I sold in February not because the market was at a high I’d like to say that I like had enough foresight to say Oh, now’s a great time to sell. The reality is I was just fed up with property and I sold and I just got lucky enough that I sold when the market was at a high I’m surprised the

 

Erwin  

buyer took it still.

 

Joseph  

I will not comment I don’t know who’s listening. Yes. 17 people I know who includes that.

 

Erwin  

Give me your name is not that Google because there’s there’s enough stanzas out there that that makes you heartless

 

Joseph  

that a compliment or is that

 

Erwin  

just have names like You’re like I say I met you in like a thing. Like when I go to LinkedIn like Joe Costanza, like, damn, there’s like 40 of you in Toronto. Like, which one that I talked to? Like that. So your current deal wasn’t the easiest. But that’s a good point. There’s a good story to that is not easy deals are often the best deals. We might bless the last ugly house I bought mouldy basement contractors wouldn’t go in because there’s cockroaches. Right? I asbestos knob and two, I can I’m just shocked the bank lent me money on it.

 

Joseph  

Well, you did bank finance loan on that. I gotta

 

Erwin  

be lender. The lender called me the day before closings. Like did you know you have asbestos? Did you know you have knob and tube wiring? Right? Yeah, I did this for a living. I can’t believe I still got my mortgage. Because most lenders will not touch that stuff. Really? I didn’t know that. My basement was leaking.

 

Joseph  

Well, yes, I was in that basement. I know. Yes. I did the drawings for you on that on that deal.

 

Erwin  

Wait, did your mother say something about that house?

 

Joseph  

My mother? Well, yes.

 

Tammy  

She was faith in her when? Yeah.

 

Joseph  

Because I think I FaceTimed her while I was in the basement with an stupid made no mask on black mould on the wall.

 

Erwin  

Just work really.

 

Joseph  

They painted over it. It was pretty bad. It was pretty good. Yeah, it was pretty bad. I probably shouldn’t have been down there. But I was down there anyway. I’ll find her in 20 years.

 

Erwin  

But it wasn’t pretty was it? No, it was not pretty. Your mom would never invest in it.

 

Joseph  

Ah Uh, maybe now, but not then. She’s come around. She’s

 

Tammy  

coming around John’s place. I think

 

Joseph  

she’s I really pushed your boundaries. Yes.

 

Erwin  

But yeah, I had to deal with a lot of crap as a student rental too. So the deal with that student rental through the pandemic tends bail. Right. I think too much five to seven times bailed. Students. Yeah, yeah. Now it’s all turned around. Because I’m finding out that rents are now six $700 a room?

 

Joseph  

Yeah. Well, yeah. That’s it’s a it’s also a killer area like you are right beside this.

 

Erwin  

Yeah. But it wasn’t easy. No, it was easy holding this whole time. But I paid 400 grand for it. Now. I’ll be in humongous demand come next rental cycle. Right. Yeah. Because I hear like, even made the news. How little rental supply there is for students. Right. So payback time. But yeah, hard houses are not easy to finance. You didn’t want to go in the basement. Your mother would probably not want to go to my basement if she knew. I think I took my deal over yours, though, because I didn’t have a tenant.

 

Joseph  

Yeah, I would have taken your deal over mine to the I think mine was a little bit of a headache. Yeah, from day

 

Tammy  

one. Irwin tried to buy it off of you. Half a

 

Joseph  

dozen $5,000. So a big commitment

 

Erwin  

to excuse me, came down when I heard there was issues that the tenant,

 

Tammy  

no, no, this was that was a score. We just for the record, we do call it John’s place. So if anyone’s hears this, or if you go on Joe’s Instagram, it’s John’s Thomas the tenant. Okay, so what have we

 

Joseph  

purchased the property back in? November is when we closed or when we when we offered on it. We’ve got an accepted offer. We’re supposed to close in January, November 2020 2021. We’re supposed to close who you’re supposed to close in January. And they were kind of going through

 

Erwin  

Washington will bring us back a little bit. Okay. The host previously failed to sell that or not. Okay, so

 

Joseph  

I had found this property listed on the MLS back in November of 2020. I went to go see it. I offered off market on it, when they taken it off their offer Express and that fell through. And then every kind of two or three months. Why did it feel to sell the market was on fire? They were they were trying to sell it for 850. Back when it was probably worth like 600

 

Erwin  

or 600. It was that bad? Well, it was

 

Joseph  

duplexes at the time, were selling for around 800. So they were trying to sell it as a legal duplex, which it was at 800. The problem is it needed 200 to 300 Depending on how much rental you wanted 200 to 300 of work. So no one’s gonna buy it for 800 or whatever they listed it I think it listed initially at like 850 At some point at one point. So I’d offered on it. Even when they’re asking when their offer fell through at 800 or whatever when they’re listing fell through at 800 I offered some really probably insulting offer at like 600 or 650. Obviously, that got the client and they ended up selling it back in or they ended up getting an accepted offer on it at 750 Back in a must have been mid mid 2021

 

Erwin  

Sorry, except to that how much at 750. And they didn’t take it and run this sale

 

Joseph  

fell through. So I was checking in on this property probably every two months I would call the realtor at some point I ended up getting the owner’s number and I was calling either the realtor or the owner like every two months, just like what’s going on with your house are you guys selling and then for a little while I kind of went off market and I thought okay, so they they told me that it sold it must have closed and now it’s done. So I didn’t really think anything up but then I drive past the property every time it was a shitshow so I really wanted to see what they were doing with it just out of pure curiosity and the roof was absolutely mangled. And no one had done anything about the roof and this is like six months so it’s stuff growing on or whatever it was no like there was little holes in the roof. There’s holes in the roof when they when we ripped up the the ashphalt Yeah, there was like holes. I got pictures I’ll show you after there was like, very large loads, like, like soccer ball size holes in the like in the sheeting.

 

Erwin  

Oh my god. Yeah, you’re gonna need 50 for that. I know. A lot banks when finance that there’s pressure finds that

 

Joseph  

nobody found it. It was anyway, so yeah, so then I think I had reached out to them at one point because I’m like, Okay, this thing definitely has not sold yet. And this is must have been like October of 2021. And I got into kind of a little bit of a yelling match with the with the realtor. At which point I was like, Okay, I’m just getting a Tammy involves and no,

 

Tammy  

I’m gonna stop here and tell you what happened. Okay, you tried to do the deal without me. Just fine. Okay. You tried to do it? Yeah. But there was no what happened? was they were going to use one of their other realtors to represent you because they didn’t want the selling agent to represent both of you. So they said, I’ll bring in a realtor and you said, no, no, no, I have a realtor. I was only going this way if I was gonna get a deal, and No, you weren’t gonna have a Realtor you don’t know probably right. Yes. So you’re like, No, no, I’m gonna bring in my own realtor. So then I call him like, oh, so yeah, he kind of talked with Joe. And they’re like, yes. And that’s where we went. That’s how I came in. Yeah.

 

Joseph  

And then, as you call me, yeah. It wasn’t on market. So I figured I’m gonna try for a market sale. And they were actually just about to list it. They were just finalising some paperwork to get him out with a tenant tenant. And he was so close to being out. It was so yeah, it was really close to being out.

 

Erwin  

This was an unethical thing. He wasn’t when he got terrible tenant,

 

Joseph  

he did not take care of the place. I think the owner of the property didn’t take care of the place either. So between the two of them nothing was getting done

 

Tammy  

very very I mean, just that when the land when we found out the landlord tenant Board gave him a warning that if you do any of these the list of items, you’re gone and it’s instant, and it was smoking in the property smoking on the property, obviously not paying rent it refusing the seller, the owner landlord to come to its own property. And swearing at people on the like, there was a massive list that he couldn’t even like look sideways. Yeah, I think

 

Erwin  

the yellow people on his lawn you don’t get up? Yeah.

 

Joseph  

Well, no, it’s not yellow people on his lawn. It was yellow people who are trying to get into the property to view the property.

 

Tammy  

Not to mention it a bat by the door. Yeah.

 

Joseph  

Anyway, so.

 

Tammy  

So we did agree on bacon possession? Yes. Well, it’s too close in January.

 

Joseph  

We’re supposed to close in January. He didn’t. He didn’t leave. They extended the the court hearing date to

 

Erwin  

did he

 

Tammy  

agreed to leave? Did he not even agree, but he was supposed to leave a certain date because he instantly screwed up off the list, obviously. And

 

Joseph  

the court had said, you’re out by January 6, January 7, so

 

Erwin  

we slipped up. So now they have an order, you have to leave.

 

Tammy  

And we found one judge that said, Okay, we’ll hear you out again, we’re going to extend it. And so we extended our

 

Joseph  

and then yeah, so then the closing date, the closing date got extended to right after their next hearing, because we were like, Oh, for sure. He’s gonna get kicked out and already been kicked out before. Like, he’s already broken all the rules that he said he wasn’t gonna break and he’s not paying his rent. So I mean, like, add all that together. They gotta, they gotta let them they gotta let him go. The court hearing finishes, they’re like, Okay, we’re gonna issue the paperwork for you to leave. We’ll just find that we’re gonna find a date that works for us, and we’ll get back to you. So I go, okay, February, I’m counting 60 days is what they give you. Like most of

 

Erwin  

paralegal involved, too. Yeah, there’s legal. There’s been done on the

 

Joseph  

on both sides. Yeah. And so I’m like, we’re talking, I’m like, Okay, well, 60 days from the date that he’s supposed to close. Okay, let’s push the closing date. 60 days out, they have the according to the LT landlord tenant boards website, maybe I’m wrong, but they need to find hearing a decision in 60 days. So let’s go 60 days. So 60 days comes in passes. And we’re supposed to close on the property. And he’s still there. And word from nobody’s told us anything, which, you know, I didn’t expect anyone to tell us anything, because we are not are not the owners. But still, like, I would like to know kind of what’s going on with the process, couldn’t get in touch with anyone’s lawyer to figure out what was going on with the process. No one wants to get involved. Closing Date comes again, closing it comes again. And so we had a conversation, we wanted to extend again, and we had a conversation with the seller who like if you’re not going to sell on, if you’re not going to close on this place with the guy in there, then we’re just cancelled, we’re off of the deal. And we’re just going to sell another property.

 

Erwin  

So another property of theirs.

 

Tammy  

They needed to Yeah, they needed something. Yeah. And this was the one they were going to sell. And since it obviously was kept, you know, in for a long, longer, longer, longer. They finally said no, either you’re gonna have to take it with them or the deal is dead, because according to our offer, it allowed us to extend, extend, extend, and then somebody extends extensions. And then, you know, that was at yet agree. And they said, No, that’s enough. So he had to come up to the second possession. Yeah, big concession. Exactly. So he had to make a decision.

 

Joseph  

I mean, I had to make the decision at the time. And the reality was when we close on the property, we had it under contract for 745. And it was probably worth in the nines, really low nines. Well, you

 

Tammy  

have to figure at this point, the markets going up and up and they know that too, right?

 

Erwin  

Oh, sorry. What did you get accepted for?

 

Joseph  

We got to sell it for 745. Okay, legal duplex Sorry,

 

Tammy  

sorry, but it’s worth noting that that was October November 2021. Things are selling for like a million now. We’re into the early 2022 and everything selling for exactly

 

Joseph  

yeah, like that. That property just as it was with the shitshow that it was probably should have sold for around 900 When we bought

 

Tammy  

and sold it with that tenant made money because the market was going nuts. Do you remember that a soccer ball size holes in the roof? You can see that you could? Well, it was Yeah, from the street. We had a home inspection. Yeah, like we

 

Joseph  

knew what we were we were on the roof that had the holes in it. On the roof, just in step in the halls. So Joe ticket, yes. So I decided that we were going to close on close with him in it. And then the next day, and then the potential cut bait decided to fish. Yes, exactly. And then proceed to the next three months of me dealing with the landlord tenant board trying to get him out. And still landlord 10 board had not given us an issue had not given us a date. And so 120 days pass, and they finally give us a date. That’s a month from then by that point I had already signed with him and then 11 saying where I needed to start construction at some point the market was kind of doing the dip, and I needed to figure out okay, what are we doing with this place? Yes. So we did a little bit of cash for keys with the property to get them out. And then we started renovations in July.

 

Tammy  

So Joe did, did we try

 

Joseph  

catch Ricky’s earlier? No, nobody tried to catch it wasn’t it wasn’t I was waiting. I’m like, okay,

 

Erwin  

16 on the place.

 

Joseph  

I offered. I was like, Hey, listen, we’ll like we’ll, we’ll pay a little bit more if they do Cash for Keys. I got no problem. They’re like, No, no, no, we’re already in the legal process. We shouldn’t we should have them out soon. Obviously, closing day comes, he’s not out.

 

Tammy  

So even you took ownership on closing date, if Joe’s automatically offering Cash for Keys, except the landlord tenant board, again, was still so close to happening and felt like any day.

 

Joseph  

Every time I call them. They know any day now we’re gonna get a notice. And then two months go by I’m like, I can’t wait anymore. This is too much.

 

Tammy  

He did the sign the papers did the Cash for Keys. Everyone’s agreeing. He’s ready. That day comes and guess what the notice comes in that Oh, yeah. He’s he’s got to move out.

 

Joseph  

The day before he was supposed to move out. They gave me a notice saying he needs to move out. And it gave the day in two days. I’m like, I’m sorry. Yeah. saved you. $5,000. But

 

Erwin  

whatever. And how much in rent arrears did you have?

 

Joseph  

How much of what your rent rent? Did? You actually paid rent every single month, every single since I took over? He paid rent every month to me. So just give him

 

Erwin  

his money back? Basically.

 

Joseph  

Yeah, so it didn’t really cost us anything. But it costs us time, which in some respects may actually be more valuable.

 

Erwin  

So I haven’t heard how things are going now. So that was when when was that? What was the Cash for Keys? When did he move out? July? July 1. Oh, just last month?

 

Tammy  

It’s almost been Yeah. Almost a month. It’s

 

Joseph  

been it’s almost been two months of renovations. Yeah. Six weeks? Yeah. How’s it going? It’s going well, it’s gone. Well, the permits sorry, this

 

Erwin  

isn’t a problem. Number five properties you have now five? Yeah,

 

Joseph  

that’s four in Hamilton, four and Hamilton. Right now.

 

Erwin  

Those are the ones that are 20 years old.

 

Joseph  

Yes, 2828 still feels like I’m moving slow, can

 

Erwin  

turn on the social media. Go talk to your friends and find out how much they’re worth how many houses they

 

Joseph  

have. That’s not the point. That’s the expectations that I put on myself. Okay. Sure. Anyway, the renovation is going well.

 

Erwin  

But we wasn’t renovation plan. What are you doing so

 

Joseph  

initially, so for the listeners, it’s a one and a half storey house with a back split attached in the rear with a 400 square foot garage. So there’s about massive there’s about 3500 square feet of living space combined.

 

Erwin  

Oh my god, it’s

 

Joseph  

huge. It’s pretty large. Like the back unit is about, like 1500 and the front one and a half story is probably about maybe it was probably less than 3500 Sorry, it’s more like it’s more like 3000 It’s a probably another 1500 for the front’s we bring into my house. Garage. And then yeah, and then and then the garage as well.

 

Tammy  

So the front back duplex, not very typical up and down.

 

Joseph  

Yeah, it’s a front back duplex. The first the front unit is basically like your typical one and a half storey house like that typical kind of like century home kind of

 

Tammy  

main floor upstairs and still has the basement as well that

 

Joseph  

and then the back is kind of like a like a back split it’s basically it’s designed very similar to the back split there’s a basement to that back unit as well as kind of a second floor and then like a half level Okay,

 

Erwin  

so when you take possession once the way if you took possession tenants out, what would you rent this place out for? As is so you didn’t lift a finger?

 

Joseph  

Oh god. Oh, no, I wouldn’t

 

Erwin  

tend to take

 

Joseph  

they they took real advantage of this place. There was holes in walls. There was yeah, this

 

Erwin  

is bad. You don’t think okay, money compensates for everything. Someone would take it for like $300 a month.

 

Joseph  

Okay, well, we’re like, basically don’t consider that. Anything under 1000. Just entertain me. Okay,

 

Erwin  

what would the what the one and a half story ran for was the back split run for?

 

Joseph  

What would the one and a half so the garage you can rent? Right now currently there’s tenants in the back unit. They’re paying 1800 Plus utilities. You filled it? No, there were already they were already there. Oh, and 1800 plus future? Fully tenant. No, they did not get along with Okay,

 

Erwin  

so that’s probably probably the reason for the order as well. Yes. Okay.

 

Joseph  

But that that back

 

Erwin  

unit, that’s really good rent 1800.

 

Joseph  

It’s not when you consider what it could rent for I know. It could probably rent for around 20 to 2300. And that, and they’re not, they’re also using the garage, which I could probably rent for an extra 200. So they’re about six to 700. under market value. We’re keeping them because like you said, 800 1800 is not that bad. Right? The reality is, I lose about $700 of cash flow every month from potential cash, cash for that we’re not we’re not doing anything to earn.

 

Erwin  

One and a half storey rented out, as is John’s place. How much food costs that you could have gotten 1800 For just cleaning it up?

 

Joseph  

Maybe 1800 Probably for that front unit if we want it to occur.

 

Tammy  

That’s not bad. Because it is a full house. If it’s cleaned up. It’s basically full house. I

 

Joseph  

mean, full houses in Hamilton are renting for like 3000. Right. Okay, what’s the plan? So the initial plan was finished the basement and finished the main unit.

 

Tammy  

Can I just say Joe’s initial plan was an initial plan. Remember, you were all over the place? Emotional, legal basement Hold on, or Airbnb, maybe? Well, you’re right, we had

 

Joseph  

a submariner dealing with this, I was the SA there was all everything simultaneously. The initial plan was to renovate to fix to the basement, then do the main floor of the everything on the first house, the basement of the first of the main house in the front, and then do a full kind of cosmetic gut of the front unit. First and second floor.

 

Erwin  

We’re going to turn that into a duplex. We’re

 

Joseph  

essentially doing a legal triplex on the mountain.

 

Erwin  

Do we need to edit this out? Yes.

 

Joseph  

Sorry, sorry, we’re gonna do it all legal. But

 

Tammy  

otherwise, he was gonna do like proper, proper everything, everything’s gonna do stuff. But yeah, like underpin it to where we’re

 

Joseph  

going to lower the floor and everything saying, this is the thing is my my perspective is, I don’t want to ever have a rental, what I wouldn’t live in. That’s my golden rule for me. So if I wouldn’t live in it, I don’t want anyone else living it. I know, that’s probably not the best, like investment advice, because you can make money on things that you wouldn’t live in. And you can make really good money doing that.

 

Erwin  

Well, this is a state. This is clarify, though, when I was 22 years, I’d much different standards than I do now. So I sometimes I’ll speak to the 22 year old would you live here.

 

Joseph  

But still, so it was it’s a six foot five basement, and I wanted to drop it down to seven. And I don’t have the numbers on me. But like I rationalised that somehow at some point. And it kind of made sense in my head. The numbers, numbers got a little out of hand at some point, which is partially the reason we’re not doing it right now. So you didn’t actually do it. We’re so we’re not doing the basement anymore. And the reason we’re not doing the basement is with the market the way it is, I want the renovation to go quickly. I want to be in and out of this place. I don’t want like if we had the same market that we had back last year where everything was just moving. Yeah, sure, I just do the basement because the reality is from going to hold it with the appreciation that we are seeing in the market last year. Even if renovation goes slightly over budget, the market is gonna save me I know that’s horrible advice. But that’s the reality for a lot of investors last year or the even in 2020 the market save them for a lot of things, the market wasn’t really in our favour here. So the plan was be in and out of this property and get our money back. And then we will look at doing those renovations later down the line. As long as it’s stabilised and cash flows and it covers all expenses then in the future we can look to kind of increase our position and the property and that’s kind of it we knew buying the property that it would be an evolving kind of property as itself you don’t need to do all all the work phase one in phases every year or probably in like two years we’ll do that back unit kind of slowly kind of do what we need to do. We also found out that we actually can’t do the basement until that back units on because there’s some electrical wiring that needs to get redone in that place to run more power to the basement. So the reality is we would have to do the whole house if we were doing the basement so it just financially didn’t make sense. So we just settled for just doing a cosmetic on the main floor, which came out to be about 100,000 When everything included that the

 

Tammy  

front main and upper main and upstairs Yeah,

 

Erwin  

so basically like cosmetic.

 

Joseph  

Yeah, that’s just cool. I’m well we did we opened up structural wall we did a little bit more than just cosmetic.

 

Tammy  

So I needed a lot higher standards than I do. Yeah. shows live in there. But

 

Joseph  

very small when we’re in there without the wall. Yeah, no, you haven’t seen it with the wall

 

Tammy  

guy. I know we’re gonna come you know what everyone we should go by

 

Erwin  

go yeah, we’ll check it out. For me as it progresses in the market with historically high rents. I don’t need to do too much.

 

Tammy  

Well, we should do in the day two and get it approved with the tenants for a visit just so we can see that back unit because it’s really unique how it circles around and the space involved. It’d be nice to see the whole thing not just the front.

 

Joseph  

Yeah, yeah. Yeah, she’s sure she’s going. You let me know when

 

Tammy  

it’s John’s place. Remember John’s places?

 

Erwin  

So what’s the rent gonna be on this place? So you spent 100 grand spent 100 grand

 

Joseph  

the rents right now I’m projecting you can correct me if I’m if my numbers are wrong, but I’m projecting around 2600 to 2700 for that, just for that front unit, because it’s basically the full house.

 

Tammy  

You’re gonna be good there at least. Yeah.

 

Erwin  

Yeah, we’re seeing we’re seeing like whole semis go for like 32 Yeah, you’re

 

Tammy  

gonna get probably close to the three could be could be three just because

 

Joseph  

I did my numbers. I’m very conservative with my numbers. I do all my numbers. I’m 20. Never guess right? I did all my numbers at 2500. So anything more than 2500 is gravy for me.

 

Tammy  

My my I my rental is a one and a half story as well. I have four bedrooms, two bathrooms, and I put tenants in last year getting 25 Friends gone up. So yeah, you’re definitely going to be at least at the numbers you just said at minimum. So I do like to run my numbers conservatively too. But when the time comes to actually rent it. Yeah, check in again. Breathing

 

Erwin  

stretch. 3000. Stretch, stretch. Over 3000 My friend Christians successful guys message me here. You put up you stretched his one bedroom? Yeah. 2200 for a one bedroom

 

Joseph  

probably get free with the garage. Garage. I think not

 

Tammy  

even and you know what else? You’ve done a lot of landscaping outside which I noticed which is huge to me. You did or your mom’s?

 

Joseph  

Mom, I like to I like to put a little I like, no, no. I like to put a little spin on every property that I I like to put a little bit of work into everything that I own that within reason.

 

Erwin  

I throw a bunch. Yeah, I

 

Joseph  

don’t think it’s the best financial advice for anyone like investment advice, but like, I do a little bit of myself.

 

Erwin  

I tried to kill the vegetation on my other property.

 

Joseph  

It looks great. I think it looks good, right? Yeah, it does. I killed all the vegetation on my other places through the art, this will probably all died as well. But

 

Erwin  

apologies the listener this sounds very dramatic. How does this compare to your other three other properties in Hamilton, or any of this this dramatic?

 

Joseph  

No, no, they

 

Erwin  

were all pretty straightforward, pretty boring duplexes. Yeah, I know that didn’t feel boring to you at the time, because I know you were sleeping in them and renovating and resolve. So I know it feels tough. But looking back at that compared to what you’re doing now,

 

Joseph  

I would not I wouldn’t 100% would not have been able to do what I was doing now, dealing with the stress associated with it. I did definitely grow through the process. And I think I mean, like my purchases have gotten gone from like, basically doing no renovations to a little bit of renovations to a full gut to now dealing with

 

Erwin  

the first property. You did a whole basement suite. Not really, really it was

 

Joseph  

already partially done. Okay. Right. And then the second one, the basement was already done, but the upstairs needed a full guide. Yeah. And then the third one, okay. The whole place needed a full gut. That would have been your more more work one. Yeah. That was the that was the biggest shock was doing the third one. Yeah. And then the fourth one was just like property. Yeah, John’s place was just like doing the tenants and then dealing with all the other crap and then doing a full guide then let’s

 

Tammy  

just add that the third property with all the surprises and the extra work you needed to do and all the gut but then when we got a foreign though, what you refight for he was like, it was worth it. Oh, yes. Different. It’s very worth it.

 

Erwin  

So what would you say the beginner so for example, I see a lot of courses out there teach to go after your John’s house. Basically, they teach that look for the off market. Look for the complete disaster soccer ball size holes in the roof. The Vanquish in my mind, when you think a beginner should take something on tape or something like that on?

 

Joseph  

I think you need a baby step your way. You can’t like at some point you need to jump in. But I think you need to kind of take your time to get to a certain point. And not necessarily sure if that because I can tell you from my experience, if I took on John’s place when I first started, I probably would have been turned off from the whole process.

 

Erwin  

It shouldn’t be 5k It would have I

 

Joseph  

could have made 5k. So I’d say no, I think like you need to kind of build up and get I mean, I usually wouldn’t recommend a turnkey property per se. But I think like even if you want us to do that turnkey route would be a good way to kind of get your feet wet with that in terms of buying a property that needs a little bit work, maybe find something that needs a small cosmetic workup rather than a full, a full gut. Right? I think of the comfort level, at the end of the day,

 

Erwin  

I think of a scuba diving analogy, when you scuba dive as a beginner to go to take any advanced course, they only allow you to do one at a time. So for example, you see you’re a recreational scuba diver. Now you want to do what’s called penetration, you’re gonna go and you’re an enter a wreck, right? You can enter a wreck, what you cannot do is do that at night, because Nate is a different advanced level diver. So you can only do one thing at a time. So take real estate investment properties. Dealing with tenants is one skill set risk factor. Yeah, dealing with renovations and contractors, another risk factor, dealing with a major renovation, where you need permits, and you have mould and knob and tube wiring, asbestos, another level, right? Dealing with the LTB situation, another level. So I think to each their own, they have to decide what level of risk you want to do whatever stage in life and you are on a stage investor, you are just imagining, like, I know that this was stressful for you and your family.

 

Joseph  

Yes, for sure.

 

Tammy  

You know, and I just want to add that I agree to that. I do think it’s, it’s nice. And it’s that nice the steps that you took building that up, and it’s nice for people, but we also have a lot of new investors that come to us wanting to do, let’s say, a duplex conversion. And that’s a really big project as well. So

 

Erwin  

that’s a vanilla one vacant house, good bones,

 

Tammy  

you know, and all kinds of, we’ve seen all kinds of things that can come up and so on. And everyone’s a little different on how they roll with stuff. But again, going back to trying to have that good team around you. And I don’t just mean me, and I don’t just mean you know, that all does make a really big difference. Because new investors, if you’re just gonna start out Yeah, it is nice to have that smaller project first, but at the same time, it’s not so scary when you have a bigger one if you have the right team to so it really kind of depends on what you’ve, you know, surround yourself with and, and how you deal with things. And we all learn that from each other. Like I always talk about James on our team, he can have things off his back, and I’m like, nope, oh, my goodness, I’m not sleeping, I can’t can’t eat it. You know, we’re all a little different, how we handle it, but trying to learn from each other and doing the best. We actually

 

Erwin  

had John’s house and you had your surgery team. Yeah. You want to wash your shirt.

 

Joseph  

But I think I think taking steps is not a bad thing. And I think I’m more took them out of necessity. I didn’t have the money. When I started to get into something that needed a full guide. At least I didn’t know how to find the money. All the money. Yes. Well, I wasn’t doing all myself. But yeah, I did a lot of it myself.

 

Erwin  

The stuff you didn’t need a licence for Yes. To do an electrical. Probably the tiling drywall.

 

Joseph  

I did. Yeah. And but like I did it more because I felt I was we were looking for those properties more because I couldn’t afford a profit entity to forgot. And I didn’t know at the time, I was too inexperienced to know that I could just go and find the money or borrow the money to do this work. Right. So I’m just looking at how much money do I have? What’s the renovation that needs to get done? Like I remember when we bought red Street, the first property that I own, like, coming to closing I was like, I actually don’t even have enough money to close on this place. Considering all the closing costs.

 

Tammy  

Is that the when you call me you’re like, I have to call my No No. Money is the one yes, that is. But then you you worked

 

Erwin  

out the neural comes through.

 

Joseph  

And then that did come on? Yeah, see? Yeah. So I think taking those steps were necessary for me because at the time learning through that experience and learning through kind of, like how to find money, how to borrow money, like I we bought the property, I didn’t even have the money to do the renovation. I was like, I’m just gonna rent it out. And we’ll deal with it at that point. And then the bank was like, Hey, do you want a $50,000 loan? I was like, Yeah, I’ll do that. Like that. Yeah, sure. And then we did that, like I was. So last minute, I was just like, I guess I’m doing the renovation now. It was just like, and then the rest is history. From there

 

Erwin  

funny how anything how things worked out. But you had all the answers from the beginning. When we met you when you were 24.

 

Joseph  

I think it was good for me though to not have the answers. Because it for no one he has all the answer. No, I know. But I’m saying what I’m saying is like

 

Erwin  

if a kid you’ll find out how many answers you do not have.

 

Joseph  

Try not postpone that right now. Not in I got too much Bill introduced filter for that stage of life.

 

Erwin  

You’ll be grateful when when you have your portfolio and then you have kids and you don’t have to worry about this stuff. Imagine having kids and then trying to build a portfolio. Yeah,

 

Tammy  

that’s crazy. I’ll never forget when when Joe and I first met and when we got the first property, and you were nervous, of course as you should be right and it’s I get it and and I remember saying to you, you’re 24 years old and saying, Do you know like we were closing your eyes? Oh my god, I can’t believe I can’t believe it. And I said Do you know how many people say I wish I started when I was 24 And you did it. You did that. You absolutely did that like this just so on

 

Erwin  

the record is our youngest Korean. I don’t really I Yeah, well, you do. Who’s you bumped up?

 

Joseph  

But whose wasn’t there somebody after me?

 

Tammy  

Well, somebody met Joe. I think they were 23. I was like, no. You’re waiting? No. They’re you know what they’re like most people, including myself who want to and talk about it and think about it, don’t do it. You did it.

 

Erwin  

There’s huge. Yeah.

 

Joseph  

I just do things and think about consequences later. I think that’s

 

Tammy  

gonna make some calls. No, getting. You did good. You did very well. Good for you.

 

Erwin  

Especially where we’re talking about rents and stuff. What are we seeing in the market for rents? Rents are our showings, up down? We’re in the middle of August. Yeah, I

 

Tammy  

was able to book this morning, went out with a client to see some houses had my pickings of 12 that I thought could possibly work, how to narrow down a little bit, we went to go see six houses this morning, very focused on one lot. It was yeah, it was an experienced investor, we were able to soak it all in. And we were able to narrow down the properties that also meet all the criteria for a garden suite. And that was just Hamilton. So it was great. So we got got to see quite a few and go from there.

 

Erwin  

I was like, compared to like, six months ago, oh, six months ago, they

 

Tammy  

would call I would even like go there’s one or two if you want, and I don’t think one’s really going to work. But we could show you

 

Joseph  

finding that a lot of people are now starting their search. I’m still people holding back a

 

Tammy  

lot of people holding back, but I am hearing a few people more calling me saying you know, Okay, we’re ready. Now we’re ready to get back in which is smart. Because right now is a really good time. You know, August 2022. Right? That’s right now is good time. I had a client yesterday, I called her up. I said, Hey, I just noticed this change on the listing we saw a month ago. And she’s like, let’s do it. weoffer done, you know, and we were able to get in and get it for a great price paid for 75. And well in for property recently. And but yeah, so we’re noticing that it’s a really good opportunity. We’re noticing a lot more, there’s certainly a lot more choices on the market, a lot less competition, a lot of houses sitting 3060 days, houses that are sitting there more ready to sell. So the house for example that we picked up yesterday was 525. We offered for 75. They had a couple other offers fell through so we went in firm they loved it took our price. So that’s what we’re seeing those kinds of changes. That because these houses check off boxes for us to check off, but this one in particular is already a duplex and welland on a 60 by 120 lot that houses all the way to the left, we’re looking into severance possibilities and the land and if not, we have a double car garage that we’re gonna turn to a garden suite, massive growth opportunity

 

Erwin  

for five. Okay, how much would have costed six months ago?

 

Tammy  

Well, it was listed six has been listed for a long time I’ve had my eyes on it, it was listed originally about 650. for probably about that long ago, I saw it go down to six. That’s when we saw it held off for a bit because I had a low paying tenant. I noticed the other day, I’m like, I just read that that tenants moving out. So that’s why we jumped on it because now it’s fully vacant and paid for 75 and went all the way up as key. That’s it exactly. Same as you

 

Erwin  

know, an argue that selling vacant is key as well as the seller if you want maximum money. Well, yeah.

 

Joseph  

But as a buyer, like the follow up, like if you’re, if you’re not following up with properties that like Why have you been surprised we’ve done it like all the time, I got my first deal the same way. The fourth deal the same, we’re just following up just be like, Hey, what did you guys sell? Would you guys sell for? All right? If they have sold and you don’t get it? And that’s fine. But like what did you guys sell for? Because I want to know, like, you know what, we have my own knowledge. So I’m going into next one, I can actually put a competitive offering. And we really

 

Tammy  

play the market because Joe and I have obviously been working together for years now. But in the market where houses were selling crazy prices were up the house that you’re talking about that you picked up was because I would talk to him about expired listings, I saw properties that are expired or sell properties that are cancelled, and so on. And these might be some opportunities down the road that we can take a look at that we’re not seeing so much in this market, because they’re actually on the market sitting that home. But before when that, you know, isn’t the case. And the only reason that house didn’t sell the way it did was because of that tenant. So another kudos for you saying listen, let’s let’s push let’s push the envelope here and then we’ll jump in and we’ll take it and take that risk a little bit

 

Joseph  

like even after like right now like we’re after this we’re gonna go see something of a showing we do we have showing and we’re gonna go look not because I don’t want to buy it at the at the price that the house is at right now. I don’t want to buy it. I don’t want to buy it at the price the house is now but yeah, it’s been sitting for 60 days. Yeah, so if they do a price reduction, I want to I want to be the first one that seen it already. So that if I want if I want to put an offer in already, and they say they dropped they go from 800 to 700. I’m just throwing ballpark numbers out there. I want to be the first one to put an offer firm at 700 Because I know I can buy it for 700 and I can do what I need to do for 700 Because I’ve already seen the place yeah So that’s, that’s the

 

Tammy  

most important part. I keep telling you, you got to get out. You got to see him. You got to see them. You got to see them. Because then once you have when an opportunity comes, you’re ready.

 

Joseph  

Yeah. I’m kind of at a waiting stage just kind of seeing what I’m doing. I’m pretty liquid right now. Just kind of waiting into nice. Yeah.

 

Erwin  

So you know, this conversation before? We’re 24 year old think about 20 year old you put so forget everything you think about you think about a 24 year old you would think Auntie so? So let me let me push that further. 24 year old you mean 20 year old you? You don’t know. 28 year old you’ve never met before? complete stranger you meet at a networking networking line? What would you think about a guy

 

Joseph  

28 Year 24 year old me would probably be pretty impressed. I don’t know if

 

Erwin  

because how much? I don’t always ask but I’ll ask you. How much is 20 year old you worth? Compared to 24? year old you

 

Joseph  

20? Well, six figures or seven figures? For sure. Millionaire?

 

Erwin  

Yeah, what would 24 year old you like holy cow, you have five properties are worth a million. And you only did in four years.

 

Joseph  

24 year old me would be probably be asking a lot more questions and trying to do the math in my head of how long I’d have to work to get to that point. And I think at 24 I was doing those numbers in my head, which made working for someone else not make sense. Which kind of started that trajectory. I don’t know if what 24 year old me

 

Erwin  

would think. But your 44 year old you’d be impressed by 20. Yeah, yeah. 100%.

 

Joseph  

I’m not impressed by myself, though. But

 

Erwin  

Are your parents impressed by you? I think I think so. Whatever your mother. Yeah, thank you. I’ll tell. I’ll tell her myself in this room.

 

Joseph  

You guys are friends. You guys talk all the time. On Instagram. On Facebook, like they have their own conversations. I’m

 

Erwin  

not gonna have a bunch of new Instagram followers. I’m gonna ask her after this. Are you proud of Joseph? She’s gonna say yes. That’s some other questions running out of time. Can you say your parents are retired?

 

Joseph  

Yes, they are retired. Now there.

 

Erwin  

And the former teachers, so they have very nice pensions. Yes, they do. And what do you think their retirement life would be with if they didn’t have those pensions?

 

Joseph  

I always thought because we were talking about this the other day. And so I asked them and don’t cool. Yeah, I did. I talked to them. My, my parents have always wanted to do something like this. Get involved in investing in real estate and stuff like that. And for the listeners, if we didn’t kind of mention on this podcast, I have two joint ventures with my parents. So that’s what I mean, when they say get involved. But I think from what they told me, they would still they would have started to invest, because the pain into your pension, although it’s great when you retire. When you add up all the money that they’ve paid into the pension, it’s actually really quite substantial. Right, which is why they’re able to retire now with the pension that they have. My parents are of the mindset that they think that they would have invested in something while they were working, instead of kind of putting their money away in the pension. Because for them the pension plan was the retirement plan. And so they didn’t have to worry about it. So they didn’t think about it, or they’re finding out now that the pension is not enough. The pension, is it? Yes, it is. But, but when you have a family that you’re still, like, kind of like dealing with and you have elderly people that you’re taking care of, and maybe those elderly people haven’t planned for their retirement. Right. things add up. Right. And it’s enough to have a good life. And but it’s not enough to have a what I would consider a fruitful tool to help us help other people Yes, to be able to help out people that yeah, that you love. It puts strain, there’s still there’s still money issues. Let’s have it that way. Right. It’s like the pension does doesn’t eliminate the money. Issues. Right. So my parents are of the mindset that they would have started investing earlier, if they didn’t have their pension. I don’t think they would have if you ask me, because my parents have been very risk averse their entire life. I think the only reason they started looking at investing is because mine invested my investments were going well. And I was showing that I was working hard at them. And I was at networking events every weekend, constantly reading up on things constantly looking at things. So I think the confidence they had in me was what got them into this. I don’t think they would have done the same thing. If they not if they were not paying into their pension. So long and short of it. I think that it probably wouldn’t have worked out very well for them if they had not planned if they hadn’t had a pension. Do you think you have any issues retiring? I don’t know. See this. What is retirement Of course you do wonder about everything. What is what is what is considered retirement? Like I think for a lot of like investors at retirement is just really entrepreneurship like being able to live all over the map live their life on their terms financially free. Right. Right. Like I look at you and like that looks like your life to me looks like retirement. I know you for you. It doesn’t look like retirement because it’s a lot of work. But you’re able to live life on your terms of doing what you want to do to some degree. Yes. All right, for me that that is the goal right now retirement where I put my feet up and not do anything. No plans.

 

Erwin  

If you want it to go by the age of 50. Do you think Yeah,

 

Joseph  

100%. But that’s is am I going to be satisfied with that? Is that the question?

 

Erwin  

Here’s one thing though. Do you lose any sleep? No, the idea of I don’t even be able to put up your feet and do nothing.

 

Joseph  

I have 50 I haven’t thought about it on me because

 

Erwin  

it’s not a worry. We were discussing before your mom’s gonna come summer 17. Next, I

 

Joseph  

will force her to come. Yes. September 17. Right. Next Saturday. Yeah, I’ll make her come.

 

Erwin  

Awesome. Because Tammy, we’re going to talk about what people are doing these days. It is funny, because I see all this fear stuff on social media. Like, there’s one lady who’s a broker, whatever she’s like, and what mind? Are you buying anything in today’s market? Message me if you are? Like, yeah, that’s view. We’re getting stuff we couldn’t get six months ago, we may not be able to get six from some experts six months from now. So we’ll talk about what what people are actually buying me. We’ll talk about what Joe bought today, at the September 17. i When meeting. Yeah, but yeah, we’re gonna just tell it like it is. I think the world is very scary. Right. But you know, we had to figure out how to navigate it. And then preferably profit from it. When talking about that, trimmer, 17. So you guys see you there, I will be there, I’m gonna be on your mom.

 

Joseph  

Do you have to invite her because I if she if I tell her to go, she will not go

 

Erwin  

to me will sign her book to see if she comes.

 

Joseph  

That’s it means a lot there.

 

Erwin  

Any final thoughts? Any final thoughts? Because we’re way over time.

 

Joseph  

I think a lot of young investors over the last year, and even now made a lot of decisions based on ego and based on and that ego kind of put them in situations where they’re over leveraged, and maybe they’re now kind of in tough situations.

 

Erwin  

I’ll add to that they’re following charismatic leaders who are no longer around

 

Joseph  

charismatic leaders who have probably liquidated most of their portfolios as well. And I think that people really need to step back and look at it from the long term perspective. Right? If you have to sell you have to sell that’s just the nature, right. But if you’re upset, because you may be down on the equity that you thought you would have had, or you may not be able to refinance for what you thought you would have had, like, you have to look at it from the long term perspective and long term perspective needs to be I’d say at least a minimum of five years, if not more, right? I

 

Erwin  

know that someone should, they should, if they’re gonna take advice from someone, they better be reading the economics, they better understand economics, because I predicted I predicted this year would be another 2017 Yeah, so if you knew God, this was your year was gonna be 2017 Are you really going hard? All right, in the early part of the year

 

Tammy  

I just want to add that we’ve been working together for a long time and I’m very proud of my son Joseph. We have an inside joke that I’m like his mom and yes old enough to be so but yeah, I think that no matter what age of anybody is going to be starting to get into real estate. You were smart that you said you know what I thought about this and I went for it and I’m doing it and a lot of people sit back and don’t always do that and you know, it’s proud of you for doing it. It’s obviously you know, young age is pretty impressive, but at any age getting into real estate is great but yeah, it’s been a pleasure working with you, Joe. We’re not done we’re going shopping today

 

Erwin  

amazing Marty come in use social media handles you guys want to share you guys got a book or something you’re coming up with

 

Tammy  

I have no book time I have a butcher Zito care if any chapter I know I didn’t even know I was so definitely going to take a look at this book. Thanks for free copywriter when you guys heard it here free copy

 

Erwin  

will cure insomnia. Social media handle

 

Joseph  

Yeah, they can follow me on Facebook or Instagram. Joseph Costanza for both Facebook and Instagram.

 

Erwin  

You lock that up or you’d have to compete for those those handles nothing. Just Joe Costanza. Joseph

 

Joseph  

Joseph Joseph Joseph Costanza, one full word on Instagram.

 

Erwin  

And you have a fat wallet just like George Wright died, voted sure

 

Joseph  

that I would not consider myself loaded but yes, sure. Pretty sure 24 year old you would consider 28 year old Yeah, probably but yeah. Oh my standards have changed.

 

Erwin  

Alright, well thank you guys for doing this. Thanks everyone. Good luck. Good luck in your property search

 

Joseph  

yes

 

Erwin  

before you go if you’re interested in learning more about an alternative means of cash flowing like hundreds of other real estate investors have already, then sign up for my newsletter and you’ll learn of the next free demonstration webinar I’ll be delivering on the subject of stock hacking. It’s much improved demonstration over the one that I gave to my cousin chubby at Thanksgiving dinner in 2019. He now averages 1% cash flow per week, and he’s a musician by trade. As a real estate investor myself I got into real estate for the cash flow but with the rising costs to operate a rental business, it’s just not the same as it was five to 10 years ago when I started there are forget the cash flow reduces your risk. The more you have, the more lumps can absorb. And if you have none, or limited cash flow, you’re going to be paying out of your pocket like it did on a recent basement flood at my student rental in St. Catharines. Ontario. If you’re interested in learning more, but it’s true for free for my newsletter at www dot truth about real estate investing.ca. Enter your name and email address on the right side. We’ll include in the newsletter when we announced our next free stock hacker demonstration. Find out for yourself but so many real estate investors are doing to diversify and increase our cash flow. And if you can’t tell I love teaching and sharing this stuff.

 

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