6- Living Off Your Investment Properties and Flipping for Profits ( BONUS: Converting RRSPs to TFSAs Tax-Free)

Episode Summary

In this episode, Quentin talks with a member who shares his journey in real estate investing, some of the strategies that he's used to build a portfolio of properties, and how he's flipped properties in the last year.

The member shares that he became interested in real estate investing following the 2008 recession, as a safe investment, while working at Bell. He purchased a condo townhouse for $96,000 as his first property. He went on to acquire 17 properties, which helped him retire after he was laid off from his job. He adds that he does things differently than a lot of other people in DurhamREI, as he manages all the properties himself, and does his own renovations and fixes. It gives him a chance to interact with his tenants. He also adds that he hasn’t remortgaged his properties. This has helped the properties go up substantially over time. As he has a low loan to value ratio, the income that he generates from the properties is really good.

Talking about his house flipping experience, he says that following the first, the lesson that he learned was “the kind of flips I want to do in the future are kind of easy cosmetic flips on relatively small houses or condos.” His second experience was much more pleasant. He says that if you're going to flip, stage it just to the nines, and make it so unbelievably nice in terms of staging. After that, he managed to flip a few other properties, where he made decent profits, while getting to work on the properties with his son.

There are two categories of MICs, one that pays about 3%, and one that pays about 15%. Then, you have to have equity in a property, and you have to take a mortgage out against this property. And the mortgage is taken out, the lender is the same company that runs these Mortgage Investment Corporations. All of the cash from step one is now lent out to be invested personally in non-registered investments. This can then be re-invested in exactly the same holdings as before or put into something entirely different. These mortgage investment corporations then pay money every month back into the RIF and back into the TFSA. As for the monthly mortgage payments, an equivalent amount is pulled out from the RIF every month for the mortgage payment, and this loop continues until all of the money from RRSP is transferred to TFSA, which you can pull out on tax-free basis.

Topics Discussed

• Introduction [00:00]
• His Background and Experience in Real Estate Investing [01:24]
• How Was He Able to Retire After Losing His Job [04:02]
• How He Does Things Differently On His Investment Properties [05:52]
• How Much Time Does He Spend Managing His Properties [09:55]
• His Experience of Flipping Properties Over the Last Year [10:53]
• What is a TFSA Maximizer and How Does it Work? [22:37]

Important Links

• https://EducationREI.ca
• https://GetRealWealthy.com
• https://DurhamREI.ca