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Finding a Home in Kelowna Real Estate
Finding a Home in Kelowna Real Estate
How to invest in Real Estate
Being a landlord can help make you rich or can help you make life work when a full-time job isn't your cup of tea for some reason. It can also be a huge headache that can go very bad places if you aren't prepared and don't know what you are doing.
Here are a few tips.
Choose a Location
Choose a Location
Some people end up becoming landlords by renting out their own house when they have to move for some reason. But if you are looking to buy a property specifically to get into the business, you will do best to buy a starter home in an up-and-coming neighborhood.
Such a home is more likely to be affordable for you. It's also the type of home that most renters are seeking out, plus the odds are good it will go up in value, not down.
Financing a home or condo purchase
Financing a home or condo purchase
Buying a residential property for the express purpose of renting it out to someone else is different from buying your own home. You cannot get mortgage interest, so special deals like 3 percent down mortgages are not available.
You will have to come up with twenty percent down. This is one reason people sometimes first become a landlord when they move and choose to rent out their house rather than sell it.
Other options include saving the money, selling assets or borrowing against them. RSP savings can be used for the first home purchase.
How to get financing
You may be able to qualify for a regular mortgage, assuming you can come up with twenty percent down. Alternately, if you find a motivated seller, you may be able to get seller financing. In short, the seller lends you the money and you make payments to them.
What makes a good rental property?
Ideally, you want to be able to rent the property out year round. Some areas attract seasonal rentals, such as neighborhoods near major colleges where the students return home every summer.
You also want good schools, low crime, an area that does not have excessive vacancies and a neighborhood near job opportunities. Basically, look for a lot of the same thing you would want in a home for yourself.
How to find good tenants
You will need to do your research, advertise appropriately online and properly screen prospective tenants. Ideally, you are looking for the following characteristics:
A track record of making payments on time
Ability to cover deposits
Reliable income
Good credit report
Positive references
No past evictions and no criminal record
Sometimes asking people you know and trust to connect you with someone looking for a rental is the least painful way to arrange this. This is especially true if you only own one or two residential units.
When should you resell the property?
This is often a very personal question. Some people sell the property because they are ready to retire and they just want to cash out. Or they sell because it's become a maintenance headache.
It can also be a financial question. If a lot of new construction is happening, you may want to sell before those units turn into competition for you. If the house is in a sellers market, you may want to take advantage of that before the tide turns.
Ideally, you should sell it when it makes sense both personally and financially.
The Real Estate Market in Kelowna is Active!
The Real Estate Market in Kelowna is Active!
February 2021 Market Update
There were 87 new residential listing brought to market last week an 70 new apartment condominium listings in all price ranges.
There were 86 residential sales including 32 homes selling over $1 million. The average sale price year to date is $949,000 based on 378 transactions. At this point in the calendar last year we had sold 191 homes at an average price of $710,000.
Things are a little more measured on the apartment side of things with the average sale price this year being $395,000 compared to $362,000 at this time last year. Unit sales are up 88% over last year.
In sum, the train keeps rolling along with no signs of any slowdown. Your guess is as good as mine as to whether or not this will continue throughout the spring and summer when our market traditionally heats up but for the time being there’s a lot of money pouring into our housing market during a traditionally slow period of the year.
We need listings. Kelowna real estate can’t function normally with only 470 residential homes for sale at any point of the year because it will just put more upward pressure on prices. This has some negative societal implications putting home ownership out of reach for people with normal jobs and normal salaries but the current frenzy of outside money rolling in is continuing.
Call Andrew Smith Royal LePage Kelowna 250-979-8066
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