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In this episode of The Hamilton Real Estate Show, the topic of Buying an Investment Property is the focus. Should you buy a duplex, single family home or a small apartment building? Do you have what it takes to be a landlord or should you hire a management company? Rob Golfi, Jennifer Draho (Sales Rep with The Golfi Team) and Monique MacKay (Sales Rep with The Golfi Team) are in the studio with Rick Zamperin from 900am CHML on June 4, 2016. Send any questions you have for Rob to firstname.lastname@example.org.
Buying an Investment Property is a huge commitment and there are many variables to consider. Dealing with tenants can be a great thing but if you pick that one bad tenant, you will have a lot of problems and wonder why you decided to buy an investment property in the first place. There are tenants that are “professional bad career tenants” and they go from landlord to landlord causing havoc. If you are going to buy an Investment Property, you want to make sure that it will not be a disappointing and costly experience for you. One the other hand, if you choose the right investment property and choose your tenants wisely, it could be a great investment.
There are so many tenants to choose from. Always have prospective tenants fill out a rental application. Sometimes potential tenants do not fully fill out the application because they do not want to divulge to much information about themselves. This is a red flag. They could be avoiding certain parts of the application because they have a bad history with other landlords and possibly their credit. You can tell when a tenant is hiding something and you need to trust your instincts and never cut corners. If a tenant tries to give you first and last months rent without giving you proper information about themselves and starts giving you a song and dance about their lives, chances are that you will not get any more rent from that tenant once you give them a key and they move in. Now you have to go through the process of eviction for that tenant through the Rental Tribunal of Ontario and that could take months. This process will cost you a ton of money and stress. Some serial bad tenants go from landlord to landlord causing havoc and it is important to know who these tenants are. Getting them to properly fill out a rental application and doing your homework can really minimize the possibility of getting a bad tenant and evicting them if you do have a problem.
If a potential tenant tries to give you cash on the spot when you first meet them and without a properly filled out application, it can be a bad sign. This could mean that they might not have a bank account. And if they do have a bank account, they may be worried that funds may get garnished. A tenant that is willing you give you fast cash may be a tenant that is hiding something. On the other hand, some old-school tenants may prefer to deal in cash and doing your due diligence with them will help you to decide what kind of tenant they will be.
Googling a prospective tenant is always a good idea as well. Check out their Facebook page and other social media accounts. Social media is a good place to see what kind of lifestyle they may have and what is important to them.
Having a management company can be a good or bad thing depending on the company you choose. New landlords need to be very careful when choosing a management company. They can be very costly and your investment could turn into a nightmare if the management company is not experienced.
Are you the type of person that would make a good landlord? Listen below to hear more on this topic.