Since I started my group of real estate investors in 2010, I receive a call at least once every 2 weeks from enthusiastic applicants who want to get rich in real estate. They’ve read Rich Dad Poor Dad by Robert Kiyosaki, or taken an inspiring course on how to make money fast in real estate.

Many people get very excited, yet they don’t realize the amount of work involved or the time and resources it takes to make it happen. Many of these courses are aimed at the US and other parts of Canada, where the market is extremely different. Even here in Quebec we are governed by the Civil Code and the rest of Canada by the Common Law. Quebec has a rent control system that the other provinces do not, which also greatly affects the business.

All styles of real estate work, however, in Montreal, some are better than others. Some may take years to come true and others overnight. Because there are so many different styles and markets, it’s always best to focus on a familiar area with one or two different styles of investing.

Can you do it all and be successful?

Assuming too much will dilute your time and knowledge. When I started in real estate, I took on a buyer who was very interested and determined to get into real estate on a short-term basis. I am sure that in the 3 years that I worked with him, we analyzed more than 100 properties and many different styles of investment. I was new and had the time but not the experience, so at first I didn’t care. My buyer would send me daily listings and I would check to see what the building would be worth once it was renovated. That took between 20 and 30 minutes for each one. Because I was looking at numerous areas that were spread out, I had to research many different markets. This type of research is crucial to get the right information as soon as possible so you don’t miss out on great opportunities.

burning his runner

When a client is not focused on a real estate idea and in a few markets, brokers will burn out. Spending a lot of time helping buyers with nothing coming to fruition is not a great business plan for brokers. If you’re looking for an experience, almost all brokers will only work with clearly self-directed buyers. It’s only inexperienced runners who have time to run all over the place.

Here is a list of the top investment styles today:

The most popular, #1. Buy and hold. This has great benefits. You can take your time to improve the value of the building. In the long term, it could be part of your retirement portfolio. You can remortgage and withdraw capital to reuse without being penalized by income tax. There are also long-term tax benefits.

#two. Flipping… ei: Buy a building short-term and improve its condition/value and resell it as soon as possible. High risk. You must have knowledge of renewals, the market, maintenance costs and more.

#3. Converting apartments to condominiums, whether divided or undivided. This method could be great, however in 2016 the condo market has been falling for the last few years.

#4. Buy houses, reform them and rent them. If you want to use this as a business model, you will need to re-mortgage and withdraw your equity to reuse on another property.

#5. Buy a small apartment building and convert the basement into more homes and rent them out, improving the value of the buildings and cash flow. Hold or sell immediately.

#6. Rent with option to buy. This is a very complicated process and there are a few ways to do it. I hear a lot of people talk about it, but I haven’t really talked to a person who does it on a regular basis. I even talked to a guy who wrote a book about it, but he never really did! The bottom line is that you find someone who has money and bad credit. You buy a house from them and they give you a deposit and pay the bills and an administration fee. After an agreed-upon schedule, they go to the bank (having built up your credit score) and take out a conventional mortgage to buy the property from you.

#7. Wholesale or assignment of contracts. Transfer of a promise to purchase to another party. This is where you have an accepted promise to purchase a building but have not yet gone to the notary. In Quebec, you must legally obtain the sellers’ permission in order to do this.

There are other styles out there however after years in the business this is the one I have seen the most. Becoming a real estate investor takes knowledge, and you’ll gain it by visiting properties, crunching numbers, and developing relationships with their resources.

I hope you enjoyed this!