From an article in The Gazette, sponsored by CIBC called“investing for the future, the fine art of properly managing your home away from home”
“Many homeowners reach a stage in life where a second property seems like a great investment.” says The Gazette. For some of those, now is the time.
1. Type of second property
Maybe it’s going to be a vacation home or a plex to generate incomes, the difference is important. If you’re going to choose the vacation home you have to ask yourselves “will I rent it sometimes?”, “will I sell it in five years? 10 years?” All your needs will only be understand and achieve with a real estate expert.
That’s a really important part. On a financial strategy way, there can be a number of tax implication and financing that can play a role in your mortgage income. “There can be regulatory or municipal restriction on certain properties in terms of generating income”, says The Gazette
3. Make a plan, with a real estate broker
Because you want to make sure you’re doing everything right, you will take the most suitable real estate broker with you on your path of buying a second property. This broker is going to be your real estate consultant to make sure you put the emphases on all your needs and financial strategies.
4. Words from Scott McGillivray
Scott McGillivray, a television host and long time real estate investor says his experience has taught him many valuable lessons along the way.
“Sometimes you might think you want to get the lowest rate and lock yourself into a five-year fixed-rate mortgage. But then you may not be able to access the equity in your home if you need to make renovations or you could end up paying a prepayment or change payment schedules. However, if your income from tenants pays for the mortgage many times over, you will likely have enough money to convert it back when you need to. My best advice for any scenario is to work with a mortgage advisor and do the math.”
( picture from hgtv.com)