S5 E16 – Profiting from Land with Natural Resources: The Story of Flow Water

Carmen and Jordan Campagnaro meet with Nicholas Reichenbach, Founder and Executive Chairman of Flow Water.

In 2015, Nicholas Reichenbach saw a mountain of discarded plastic water bottles as he left the Burning Man festival in Nevada. Instead of just shaking his head at the problem, he resolved to find a solution. That’s how Flow was born. Since starting with a single family-owned artesian spring in Canada, Flow has grown rapidly. As a Certified B Corporation, Flow meets the highest social and environmental standards. 

In this episode, Nicholas shares the inspiring story of Flow. He explains how he turned the artesian spring on his family property in Ontario into an international brand. 

This is a great episode for those wanting to learn how to leverage land with natural resources into a thriving business.

S5 E15 – Enhancing Real Estate with Textile Design

In this episode we discuss ways that investors, business owners and homeowners can transform their real estate with creative strategies using textile design!

Hosts Carmen and Jordan meet with Candice Kaye, founder and creative director of Candice Kaye Design – an international textile design studio specializing in bespoke wallpaper, rugs and embroidered linen.

This is a fascinating episode for those looking to create a one-of–kind product that stands out amongst the competition.

S5 E14 – Investing in Modular Homes with ROXBOX Containers

Carmen and Jordan meet with Anthony Halsch, founder and CEO of Roxbox Containers, a Denver based manufacturing company that designs, engineers, and builds custom structures out of shipping containers.

In this episode, Anthony shares the story of how Roxbox was created and how the company has grown to service clients all over the world in commercial, industrial, residential, office and food & beverage industries. 

Anthony talks us through why an investor may gravitate towards the custom shipping container route compared to a traditional build, time efficiencies, the innovative design and build process,  financing structure and more.

This is a fascinating episode for those looking to get creative in their real estate and business endeavors. 

Disclaimer: The views and opinions expressed on the show are those of the individual guests and do not necessarily reflect the official policy or position of 30 Minutes to Wealth. Some episodes are for mature audiences and include language not suitable for young listeners.

S5 E13 – The Investor’s Guide to Taxation in Rental Properties

Carmen and Jordan meet with Blake De Luca, Chartered Professional Accountant at RLB Canada, to discuss tax implications with rental properties.

In this episode, Blake shares all the tax information any investor will need to know when it comes to owning and operating short term and long term rental properties. Blake provides key information on the two investment strategies as well as what’s involved when it comes to converting an owner occupied property into a rental and completing renovations. This is a value packed episode that offers exceptional insight into effective tax strategies for the Canadian real estate investor. 

S5 E12 – Riches in Real Estate Niches

Carmen and Jordan meet with Heather Blankenship, real estate investor and entrepreneur. 

Heather’s investment strategy primarily focuses on RV Parks, Mobile Home Parks and section 8 Multifamily properties. With nearly 11 years of experience as an investor and niche broker covering RV Parks and Mobile Home Parks, Heather has supported nearly $300M of transactions in the industry. 

In this episode, we talk to Heather about her incredible success story, how she got started in real estate on a whim, where she chooses to invest, how she evaluates her properties, and her secret to success. She is an educator in the RV park industry and a big advocate for women in real estate. This is a must watch episode for anyone looking for inspiration. We highlight how there is incredible opportunity in real estate asset niches, and how hard work truly pays off.

S5 E11 – The Future of Urban Agriculture

Carmen and Jordan meet with Tyler Whale, entrepreneur and subject-matter expert in the agricultural industry.  Tyler holds a Ph.D. in Immunology, he is a business development lead at Saskatoon Colostrum Company, the Industry Liaison at the University of Guelph, and the President of Ontario Agri-food Technologies (OAFT).

Tyler has worked closely with dozens of ag-innovation companies from all over Ontario and we were so excited to talk to him about the future of urban agriculture, and more specifically, vertical farming.

Vertical farming is the practice of growing crops in environmentally controlled vertically stacked layers. Tyler talks us through how investors can partner with industry professionals to convert existing industrial properties into vertical farms. He also details what is required to build Canadian capacity in vertical agricultural  infrastructure, the investment required, and how this method can change food production as we know it locally and globally! 

For anyone interested in this hot topic, vertical farming presents a tremendous opportunity in the Canadian landscape for investors. We encourage you to watch the full episode to learn what is on the horizon in this space.

S5 E10 – The World’s Most Wished For AirBnb

S5 E09 – Legal Expertise for Successful Condo Development

Carmen and Jordan Campagnaro meet with Maria Durdan and Bilal Mirza, Partners at Simpson Wigle Law, to discuss condo development.

In this episode, Maria and Bilal breakdown the process for those looking to either convert an existing multi-residential property into a condominium, or those looking to develop a condominium from the ground up. This is a very informative episode as Bilal and Maria share their knowledge and expertise on the legal “must knows” an investor should be aware of to excel in this type of investment strategy.

S5 E08 – The US Investors’ Financing Guide

Carmen and Jordan Campagnaro meet with Rudy Renelique, Managing Director of Aurum & Sharpe, a commercial mortgage brokerage based out of Brooklyn, New York.

In this episode, Rudy talks to us about how he specializes in real estate investor financing across the United States. Financing is often a hurdle many Canadians face when looking to purchase in the US. Rudy shares what lenders look for, property types he can finance, typical terms and structure. 

This is an extremely informative episode for investors looking to invest in the US market. Be sure to check out this episode for all Rudy’s Do’s + Don’ts when it comes to borrowing!

For more information visit Profunds.ca

S5 E07 – Excelling at Agrotourism

Carmen and Jordan Campagnaro meet with Emma and Jessica, owners and operators of Purple Hill Lavender Farm, located in the beautiful rolling hills of Creemore, Ontario.

In this episode, Emma and Jessica talk to us about how they converted a 45 acre family property of over 30 years into a thriving family run-lavender farm. We talk about the process of growing crops and creating a business in the ever expanding agro-tourism industry, the investment required, the importance of marketing and branding, managing seasonality, profitability, and more! 

We had such a wonderful time chatting with this sister duo, both of which left their corporate jobs in PR to pursue their dreams among nature. They have created an incredible destination location for visitors offering tours through their lavender fields, a vast product line and a number of fun experiences for visitors, demonstrating the lucrative potential in agro-tourism as a real estate investment and business strategy.

Emma Greasly & Jessica Ridding
Website: purplehilllavender.com

S5 E06 – Stepping Out of Your Comfort Zone

Carmen and Jordan Campagnaro meet with mother daughter duo, Terri and Jessica from Terri Hastings Real Estate Group. Terri has built a reputation for herself as an elite Realtor in the Bruce Peninsula, Ontario and is heavily involved in the community. Her daughter, Jessica is a real estate investor herself and also the VP of Marketing at the firm. Together these wonderful women joined us to talk about getting out of your comfort zone when it comes to jumping into real estate investing.

In this episode we discuss how first time home buyers and investors can begin their investing journey in secondary and tertiary markets with better affordability, creative financing strategies with private money,

S5 E05 – Canada’s Economic Update

Carmen and Jordan Campagnaro meet with Deputy Chief Economist of CIBC World Markets, Benjamin Tal. This is the second time Benjamin has joined us on the show to talk about very valuable updates in the Canadian market. 

In this episode, Benjamin answers our burning questions about rising interest rates, inflation, oil prices, a potential recession on the horizon, and the best real estate asset classes investors should look towards in this climate. As always, Benjamin is full of great insight and you’ll want to watch this full episode in order to understand current and projected market impacts of the Canadian economy.

S5 E04 – Restoring Heritage Mansions

Carmen and Jordan Campagnaro meet with Anne Marie Cummings to discuss her journey in real estate. After retiring from a 30-year career in technology sales at the age of 55, Anne Marie went on a journey to reinvent herself and determine how to live a meaningful life in retirement. While researching her book, Anne Marie discovered the concept of co-housing and the benefits this environment can provide to its residents.

She started restoring heritage homes in her town for the purpose of creating co-housing environments from heritage mansions. In addition to creating these projects, among others,  she is also restoring some of the most beautiful historic homes in Canada. Anne Marie was a long time follower of our show, and we were so excited to welcome her to share her own story. 

In this episode, Anne Marie talks to us about how she got started investing in real estate (it’s never too late!), what she looks for in a property, and how she has created incredible wealth for herself with renovating and flipping heritage homes, a true niche and passion project!

S5 E03 – Passive Investing in a REIT

In this episode of 30 Minutes to Wealth, hosts Carmen & Jordan Campagnaro meet with District REIT and Luan Ha, Exempt Market Dealer at Fundscraper Capital Inc., to discuss real estate investment trusts (REITs).

To learn more about District REIT:

Web: districtreit.ca

Read the Full Episode Below

Passive Investing in a REIT with District REIT S5 E3

(Note: This transcript has been modified for clarity purposes)

Carmen: Hi. I’m Carmen and this is Jordan. Welcome to 30 minutes to wealth. 

Jordan: The show that teaches you how to build wealth through real estate.

Today on the show, we’re going to be talking about investing in a REIT which is a real estate investment trust.

Carmen: Our guests today are here to share all the juicy details of how to get invested in this vehicle, the returns and how to get involved. Don’t go away. We’ll be right back.

BREAK

Jordan: Hi, I’m Jordan, and this is Carmen. Welcome back to 30 Minutes to Wealth. Today, we are talking about investing in a REIT, specifically District REIT, which is a sponsor of the show.

We’re so happy to have Paige and Laun here. Guys, thanks so much for being on the show today.

Luan: Thank you. 

Paige: Thank you for having us.

Jordan: Yeah. So, Paige, you’re the manager of investor relations at District REIT. And Laun, you’re an exempt market dealer for District REIT. Tell us a little bit about yourself.

Paige: Yeah, sure. I mean, I’m the main point of contact at District REIT for any investors that come in and want to learn about the product. So they would come into either myself or one of our team members to get connected to learn more about the product. We would then hand them over to Luan, and he will really take them through the entire investment process. And once they’re through and they’re actually invested in the products, they come back over to us and we handle them throughout the entire term of their investment. So from there, you know, we can help with anything from daily inquiries all the way to quarterly reports or annual financial statements to give them information on their investment online.

Luan: Hi, I’m Luan Ha, I’m the President and CEO of Funds Paper Capital. We are an exempt market dealer and we represent District REIT for investors. 

Carmen: Awesome. And OK, so what does an E.M.D. do for an investor and why do we have to use an E.M.D.? And that’s a question so many of my clients ask me. Why do we have to go through somebody else?

Luan: Yeah, so an exempt market dealer participates in the private investing space, investing in private real estate is highly, highly regulated. So there are various rules and laws provincially, federally, and investors who are interested in investing in private real estate. They have to go through a variety of procedure including ‘Know Your Client’, which is called KYC. We have to verify the idea of all the investors and also assess the suitability of various investments for that investor. So when they go through the onboarding process, we make it as seamless as possible, as easy as possible. And if an investor has a certain timeframe, a certain risk tolerance or various investment objectives, we try to make sure it lines up and aligns with the underlying investment opportunity. 

Carmen: Right.

Luan: So for something like district REIT, which is in the private exempt space, we help the investors, to complete the forms. We help them complete their suitability assessment. We try to make sure, that the underlying investment matches their objectives.

Jordan: So, we’re taking a step back, for those who are maybe a little bit unfamiliar about what even a REIT is, could you guys give us a little bit of an idea Paige,maybe what is REIT and then, you know, what is District and how does this kind of all come together? 

Paige: Yeah, absolutely. So a REIT is a real estate investment trust. And really what it allows for is for investors to pool their money together, to invest in a diversified portfolio of various different income-producing properties. So that could be, you know, residential and commercial properties for district REIT. Specifically, we focus on the southern Ontario area for these properties. And, you know, through those acquisitions, they’re actually a partial owner and all of these types of properties can generate both income and growth from being a part of the assets.

Carmen: Right. I know that’s what’s so exciting about a REIT. Because if you don’t want to actually have to go in and work at and deal with tenants and all that stuff that I do because I am very involved in the day-to-day with the operations in our buildings. It’s a lot of work. 

Jordan: Exactly.

Camren: And, you know, you have to qualify for mortgages and all of this. So when you’re invested in the REIT, you don’t have to, Right?

 

Paige:  Exactly and that’s really the main piece of feedback, we’re hearing from our investors and why they want to come to us to learn about District REIT is they don’t want the hassle of being a landlord. You know, it’s not always glamorous and they don’t want to have to do the maintenance and the property management and deal with the tenants so they can invest possibly with us. And they don’t have to do that heavy lifting, but can still acquire these properties and benefit. 

Luan: Some of the additional benefits of investing in a private real estate investment trust a REIT is basically a flow-through structure and has tax efficiency benefits. And so whenever there’s income earned in the REIT it gets distributed to investors. So the rental income or other sources of income from the underlying

assets and properties it flows through the REIT don’t get taxed at the trust level, then get distributed to investors. And so that’s why it’s a great way for investors to receive a relatively stable income stream. And sometimes it’s a premium return just like with District REIT. I believe DISTRICT REIT is targeting an 8% cash distribution and within a three to five-year time horizon. Expect a return of 11 to 13% so you have some benefits of tax deferral you have some benefits of potential capital appreciation because as the asset values go up then the prices should reflect that

with potential increases in the unit values as well. So by being a passive buster into a diversified portfolio like a REIT, then you have some benefits of owning indirectly

the real estate, but not having to be a full-time landlord.

 

Jordan: I think that’s a really fantastic avenue for people that do want to get into owning real estate, but maybe they don’t have the time or the resources or even the capital required to start that on their own. So here they can kind of take part. They’re still indirectly owning amazing assets, real estate assets and benefit from that appreciation, but they’re not having to do all that work and all that upfront to kind of leave it to the management team to take care of for them.

So I think that’s a really, really key benefit of these types of passive investments.

Luan: Yeah, you get professional management and with the District manager team, they are vertically integrated company, so they have the ability to acquire financing. They have that specialization, skill, they have property management, in-house leasing, in-house development management, and these are some unique, differentiating factors, for a REIT such as District REIT,  because not many REITs, have the full spectrum of vertical integration like District REIT themselves. And so that’s another avenue of adding value for the underlying assets such as District REIT and we view that as a very big plus for REIT holders. 

Carmen: Absolutely. Well, having the ability to get financing on these assets, getting the best possible interest rates and terms that we need, and having management in-house is key because that’s the key to all success. And real estate management is number one. And then also having pipeline, like having the ability to buy income producing assets like today in our in our market, in our world, multi-residential income-producing properties that the rich is acquiring is the hottest thing in the industry right now. Like finding those deals is impossible.

Luan: It’s competitive 

Carmen: it is so tough and the cap rates are so low. So when you’re purchasing these assets, they’re so expensive and the cash flow is limited, right?

So it’s hard to get into that. So the benefit of having that integration in the companies is huge because you have the first opportunity to acquire and, it’s huge for people.

 

Luan: So and with the intercompany, you could look at different ways to add value to the underlying assets that other managers may not be able to see in those underlying assets as well. Right. So that’s another huge, huge advantage.

Jordan: Now Luan you also mentioned Private REIT and Paige, you referred to District as being a private REIT as opposed to a public REIT, can you guys talk us through and differentiate a little bit about what those differences are and why that is important for investors to know. 

Luan: Yeah, for sure. So most people who invest in private real estate, they don’t like the volatility, of the stock market. And so when you invest into some of the big names in the REIT sector, on the public side, on the stock exchange, you potentially have the subject to the volatility, of the underlying market, the capital markets.

So you almost lose the benefit of stable asset values that you otherwise would get from private real estate. So when you look at the private real estate investment side, they are not listed on a stock exchange. So yes, there isn’t as much liquidity on a day-to-day basis, but you don’t have the potential volatility that’s driven by the capital markets or the stock exchange. That’s one of the major benefits of a private versus public REIT that investors should consider. Also, when you look at public REITS or private REITS a lot of times, large institutional asset managers, they’re investing into public reach potentially. And if they choose one day, to liquidate their holdings because the market turned and they have a different perspective on the entire market, then you as an investor, they call it investor contagion. And so even though your strategy was a long-term hold, another investor strategy might have been a short-term hold. And then there’s potential volatility there.

Paige: Yeah, exactly.

Luan: Whereas on the private side, it’s restricted in terms of transfers and sales. And so the asset values and the unit prices are reflective of that where it’s more stable and so the technical term is it’s less correlated with the stock market.

So you preserve that benefit of owning the underlying real estate assets from a more passive point of view. So that’s probably the biggest distinction between public and private REITs,

Carmen: Right? Absolutely. Do you find that investors like the fact that it’s a private REIT, do they know the differences when you speak to them?

Luan: Yeah, with private REITS, investors are able to understand what the pipeline is. It could see the assets in there as well. Sometimes if you invest into a large public REIT, you may not even know what’s in the portfolio of assets. And so having a more of a closer connection with the underlying properties in a private REIT is one of the benefits that we hear from the masses as well. And to from a return point of view, a lot of times the public REITs because of the large ticket investors and the essential asset managers, they drive, they can drive up the unit price and then it drives down and compresses the yields. On the private side, it’s not widely circulated. And so the ability to maintain stable distributions and a premium return, you sometimes see higher distribution yields on the private side versus the public side.

Carmen: Absolutely. Well, I think we have to go to break. So we don’t have too much time and we have so much to talk about. We could probably sit here for about three or four hours to go through everything but we’re going to be getting further into the returns and the tax advantages and how to qualify and the qualification criteria so hold our thoughts here and don’t go away. We’ll be right back.

BREAK

Jordan: Hi, I am Jordan and this is Carmen. Welcome back to 30 Minutes to Wealth.

Today, we’re on the set with Paige and Laun, and we’re talking about investing in a REIT. So to kind of pick back up, we were just digging into a little bit the difference between private and public REITs, and kind of just one more question I wanted to ask was, is when we’re looking at private REITs, how are the valuations in unit prices derived there? Because we saw on the public side, it’s a lot more based on the market. So can you guys talk to us a little bit more on the private side?

Paige: Yeah, absolutely. I mean, I think that one of the main reasons why people come to us is because they don’t like all of that volatility that you can see in the stock market at the uncertainty. So when you look at the value of our assets, they’re really evaluated by a couple of different factors. One of them could just be simply market conditions going up. But also we put money into these properties to renovate them and add value through those avenues or from rental prices increasing. So there is a couple of different things that can contribute to the unit price increasing so that investors really get to take advantage of the growth side of this investment.

Carmen: Well, at the end of the day, it’s value. So commercial real estate, multi-rise is all about your income. So the more you increase the revenue and decrease expenses and be super efficient is where you have a very good bottom line, which is your net operating income, that there is creating value and with the demands. That’s how values increase and that’s how a REIT is successful.

Luan: Yeah, and that’s a key on that point about and why it’s important to note that when a unit or a REIT determines their unit prices, they get third-party appraisals to evaluate the NY on all the underlying assets. These appraisals are qualified. They’re certified with a governing body and then they put together a very detailed report and they look at the market conditions, they look at the leases, they look at the cash flows from these assets, and then they do their own copies for NOI. 

Carmen: Right.

Luan: Then they take a cap rate to the body, and then it shows you the value for the properties. From there, they take the aggregate that they deduct any debts or liabilities of the REIT and then the remaining amount is the equity that’s divided by the number of outstanding units. And that is how they derive basically the unit value. So it is the important thing to note is third-party appraisals. It happens, I believe, once every year for a private REIT.  That’s right. And that’s according to certain accounting standards. And it’s based off of valuations and reports that also include what’s happening around the surrounding market.

Carmen: Right, exactly.

Jordan: And so district REIT is a diversified REIT, can you guys talk to us about what this means and how this is beneficial for investors?

Paige: Yeah, absolutely. I mean, it’s diversified in a couple of different ways. One of them being the location and another one being the asset type. So in regards to the location for district REIT specifically, we really focus on those secondary and tertiary markets. You know, we’re not the downtown Toronto investors in the sense, but because we find so much value in those outskirt markets. 

Carmen: Yes.

Paige: And I mean, you know, especially in the last two years, we’ve seen it more than ever how important these other markets are because people are leaving those areas and they’re going out and 

 

Carmen: they want to be in smaller communities. 

Paige: Exactly. Yeah, they want to be in smaller communities. And not only are these places becoming more attractive because of the prices of everything right now and it being so hard to buy, but also people like that, you know, small-town feel and being away from the city. So we’re finding a lot of value there. And it’s been incredibly successful for us. And what it’s meant, especially over the last few years, is that we’ve been able to maintain extremely high occupancy rates because people are going to these markets. 

Carmen: Yes.

Paige: So we have a lot of diversification in that sense to be in those outside markets and in addition, we can have all different types of assets. So it could be commercial, it could be residential. You know, we have the ability to expand into industrial oil or wherever we find value, right?

Camren: Absolutely

Paige: So depending on the markets, depending on the best acquisition we can make, we have the flexibility, which also means the investors get to participate, in a whole lot of different types of properties that they wouldn’t be able to do on their own. Right.

 

Carmen: And some REITS,  even if they are private, they actually just have one asset class in there. Exactly where this one here is diversified.

Paige: Yeah. It’s very specific to the district property trust. A lot of it, as you said, are very specialized in the sense and we can offer a wide range, which is pretty exciting.

Jordan: And Carmen, I mean, you’re the co-founder and trustee of District REIT Yeah. I know that having something that was diversified and positioned in these types of markets was something that was very important to you and kind of your vision for where you always wanted to go.

Carmen: Absolutely. Absolutely. Yeah. Well, with us having being in the industry for so many years and having access to management and development and finance, it was just perfect. And we knew our investors wanted to participate in real estate and how could we help them succeed and participate with us in this. And this was the perfect solution. 

Luan: So whenever investors are valuing a private REIT and building their real estate portfolio, obviously returns is one of the biggest key factors.

Carmen and Jordan: Yes. 

Luan: And so when you look at the returns, look at the track record. If we look at digital REIT, they’ve had a very stable cash distribution yield of about 8% since inception. And so it’s payable monthly. So by the end of the year, let’s say you invested thousand dollars, projected cash distribution of about $8,000, divide that by 12, and that would be expected monthly distribution. Of course, historical performance doesn’t always indicate future performance, but it certainly helps you evaluate what could be expected going forward. 

Jordan: Right.

Luan: So it has an overall return target of 11 to 13% that’s based upon a medium to long-term hold of anywhere from three to five years. The 8% of that 11 to 13% is the cash description that you’ll be receiving expected on an annual. 

Jordan: So by cash distribution, you just mean every month that investor has that cash flow coming into a bank account, whether that’s they invested cash or I believe registered funds are eligible as well.

Luan: Yeah, that’s right. That’s the dividend income. The distribution that they expect to receive on a cash basis derives from the underlying income from the assets. So whether it be rental income or the interest rate gets funneled right and gets paid back to the investors. 

Carmen: Now the really juicy part is the tax deferral. Can you talk about that?

Luan: Yeah, sure. So one of the biggest benefits of investing in a private REIT is their tax deferral and it’s a very tax-efficient investment because, unlike a corporation, it doesn’t get taxed at the trust level. So any income that’s generated by the trust or the REIT on behalf of the unit holders will flow back to investors not taxed when the investors receive the distributions. Some REITs will classify that distribution as a return of capital and return capital is not taxable. 

Carmen: Right.

Luan: So District REIT as a private real estate investment trusts. So far, -a significant portion of the distributions have been classified as return on capital. So you only get tax when you sell or redeem your units. And if you sell or redeem in three years or years of five years, depending on what your cash needs are then that’s effectively when you’d be getting taxed.

Jordan: This is so exciting. I mean, what a fantastic structure. So if I wanted to invest, what does the process look like in getting started and what’s the minimum investment and what are there any specific qualification criteria that investors need to be made aware of? 

Luan: Yeah, sure, because it’s highly regulated. And so one, they have to be onboarded. They have to complete a variety of streamlined online forms. Once we qualify to participate, that is depending on what kind of embassies are, there might be some limits on an annual basis, but we would walk each client and investor through that process, make them comfortable and make them aware of the offering we make them understand what they’re investing in including the risk and the potential rewards. And also we try to make it as easy as possible. We’re always available for in-person meetings, phone calls.

Carmen: And now the thing is, you’re online. You’ve got a great platform. 

Luan: Yes.

Carmen: And that’s what intrigued us so much was your company online.

It’s amazing what you’ve done and everything. It’s online, so you can actually apply online. You don’t have to wait for somebody. You can actually fill it in. And right away 

Luan: We’re available, 24X7.

Jordan: We love it.

Luan: In the comfort of your own home and you don’t have to step out. You could do it in your own pajamas. So you take your time to value materials. We make available all the materials. So with an offer like district REIT, you have to review what’s called the offering memorandum. It’s a very long, detailed document.

Paige: Yep! 

Luan: It summarizes the REIT, it provides you with all the risk factors, it outlines the terms of the investment. So that’s a very important document that all investors should and have to review. And then they would have to sign and review a subscription agreement for their investment.

 

Jordan: Right. 

Luan: It’s also eligible for registered funds. And so if you were planning to, if an investor were planning to subscribe and invest with their TFSA or an RESP or RAF account, or any other type of registered plan account, we would also help facilitate that process. Well, sometimes it could be very confusing or type two purposes, but we make it as easy as possible. 

Carmen: Yeah, that’s great.

Jordan: Now, is there a minimum investment like, if I wanted to participate, how much would I need to look at to be able to know if this is even a fit for me?

Luan: Yeah, the minimum subscription amount initially is $10,000 per investment. Any subsequent orders or investments. The minimum is $5,000. 

Jordan: Oh, OK. It makes it quite easy for investors to, you know, if they want to get into real estate, but maybe they don’t have the down payment and you know, 100,000, 200,000, 300,000 sitting in their account. This is still a fantastic way for them to get started, get that ball rolling, whether it’s funds they have in their TFSA or savings that they’ve set aside, and start to start building their real estate nest egg.

Carmen: Absolutely. 

Paige: Exactly. It’s pretty cool that with only a $10,000 investment, you get exposure to all of these properties and you are truly a partial owner of all of them. Right. And it’s becoming harder and harder to buy these properties on your own. And I mean, we’re talking multimillion-dollar properties in the REIT, right?

So obviously that’s a tall task for a single person to do. So to be able to pull together with you know, like-minded investors who want to do the same thing.

It’s a great option.

 

Luan: I know we always recommend to clients who are looking to diversify their overall investment portfolio, to always consider private REITS because by providing

that additional diversification that you otherwise wouldn’t get, if you’re only investing in a stock, risk is a very important topic for investors to consider. Of course, when they see a higher return, they always like to say higher risk, high return. And so those things are kind of in tandem. And so when you look at a private REIT offering, you have to take a look at the loan-to-value ratios on the underlying assets. You want to make sure that the REIT isn’t over-levered. I want to believe that District REIT on a proper level is about on average 57% loan to value. So there’s a lot of equity value built up in these underlying assets. 

Jordan: Right.

Luan: And so from a call it, indebtedness point of view, that seems very that seems like a pretty conservative low ratio. Also, you want to look at the stability of the income stream and the NOI that you mentioned the net operating income that’s usually driven by what’s the quality of the leases and the tenants in these underlying assets. So that’s another major risk factor because obviously your occupancy rate and tenancies drive your rental income. So another risk factor to pay attention to is what’s the ability and what kind of tenants are you attracting.

And I believe with District REIT, most of the square footage currently today is in the residential rental. And in this market, people who are renting, it’s quite a stable

income stream because if you look at even the Ontario entire province of Ontario, the current vacancy rate is sub 3%.

Carmen: So yeah, sub to sub 2%. 

Luan: And that’s a very healthy competitive market. I think Canada last year brought in 400,000 immigrants. So population increase demand for housing.

And so another major risk factor is what about the underlying and surrounding markets, what’s happening around these areas? Is there continuous infrastructure investment? Are there other investments in terms of other assets being built around these areas? And so that’s where you have to rely on the trustees and the management team and the experience of the team at the REIT. Because if they acquire an asset in the wrong area or they can’t manage it properly because they don’t have that experience in the asset class, then that’s certainly a major risk.

Carmen: OK, exactly.

Jordan: Before we wrap up today, Paige is there any last things

that you could provide to us, the feedback you’re getting from investors and.

what they’re saying.

Paige:  Yeah, I mean, absolutely. It’s you know, to reiterate some of the great things that we already talked about, it’s just so accessible for people right now to invest in this type of product. You know, they have the ability to come in and invest sometimes within like a five-day window. It can happen that quickly because the process, as Laun said, it’s very streamlined. So, you know, our team,

we work closely with AMD to make sure that they can bring our investors through very quickly. And then from there, we’ll take care of the rest. And they just get to take advantage of, you know, seeing that monthly distribution come out to them, whether that’s through income or growth avenues. And they just like the accessibility that it brings to a diversified portfolio,being able to be a part of this and of course, one of the big things, is having the expertise from, you know, Carmen and Richard to really bring in here all of their knowledge on the areas and the properties. And, like you said, the financing, the construction, property management.

Paige: So all of those together -!make for an exciting investment for the investors.

 

Carmen: Exactly. Amazing. 

Jordan: Well, thank you guys so much for being here today. This was amazing and had so much value. I think everyone is going to love this and be so interested to learn a little bit more about this So thank you again for joining us.

Luan: I think we’re here to always help with the investors and we always recommend investors seeking professional, independent advice talks and or financial advice. Always good to do that as a potential investor. And Paige and I are always around to help investors go through the process.

Paige: Absolutely. Thanks guys.

Luan: Thanks for having us.

Jordan: If you’re interested in learning more about District REIT, you can go to DistrictREITca. And for more information on real estate investing, be sure to go to 30 minutes to wealth to check out the rest of our episodes.

Carmen: Thanks for watching and go create wealth.

S5 E02 – USA Real Estate Hot Spots with Kristina Smallhorn

Carmen and Jordan Campagnaro meet with Kristina Smallhorn, a Youtube content creator and realtor in the USA, to discuss investing in the United States. Kristina shares valuable insight on current market trends as well as real estate hot spots among different states. With a specialty in affordable housing alternatives, Kristina also discusses some profitable income producing investment strategies in the tiny home and mobile home space. 

If you’re interested in investing in the US real estate market, be sure to check out this episode!

Kristina Smallhorn

Web: kristinasmallhorn.com

Read the Full Episode Below

USA Real Estate Hot Spots with Kristina Smallhorn S5 E2 

(Note: This transcript has been modified for clarity purposes)

Carmen: Hi, I’m Carmen, This is Jordan. Welcome to 30 Minutes to Wealth, 

Jordan: The show that teaches you how to build wealth through real estate. Today on the show we are excited to talk to a real estate agent and content creator that’s going to talk to us all about the US market.

Carmen: Kristina has a boatload of information about investing in the United States, where to invest, and the best types of properties to get into. So this is going to be an awesome episode. Don’t go away. We’ll be right back.

BREAK

Jordan: Hi, I’m Jordan, and this is Carmen. Welcome back to 30 minutes to wealth. Well today we’re here with our guests Kristina Smallhorn. Kristina, thank you so much for joining us today.

Kristina: Thank you for having me. I appreciate it.

Jordan: Yeah. We’re so excited to talk to you. You’re a content creator on YouTube and your videos are amazing. And we’d love to hear a little bit more about how this all came to be a real estate agent. And we’re going to talk about US investing and market and some really cool topics today. But to start, tell us a little bit about yourself and how you got to where you are today.

Kristina: I’ve been a real estate agent in Louisiana now since 2007. I’ve been worse at buying and selling homes all throughout the state here and then in about 2017, I was kind of coming up with a different strategy in order to market myself. So I started making videos on Facebook and YouTube and then I really kind of found a passion for it. And then right before the pandemic, I decided that I was going to really kind of focus on content creation to help as many people as possible to find affordable housing options. Because while I was doing all this, I was finding that more and more people were having trouble finding the right kind of information when it came to finding something affordable.

Jordan: Um, hmm. 

Kristina: And if they did, they were having a lot of things happen to them in that process that could have been avoided and that could have saved them a lot of money. And there are a lot of predatory lending practices when it comes to more affordable housing options. So I make content that kind of exposes that a little bit.

Carmen: I see that there. Is it controversial?

Kristina: Umm, I don’t think so. I don’t believe so. I just think it’s because the information isn’t out there. So I feel like people, they don’t know what they don’t know. So they get themselves into situations because they think that’s their only option and no one’s ever told them there is other options. So I tell them there’s even though they’re saying this, you may want to check this out here, here and here because you are open to other things. You don’t have to have that kind of interest rate.  You don’t have to use the lender that’s sitting on the lot of the manufactured home lots. You can use somebody else. So they didn’t know that. Nobody told them that before.

So, you know, I just I help educate them so they know they have more confidence into going into some of these deals and not and not yet lose a lot of money. You know, I don’t want anybody to lose more money than they need to. 


Jordan: Yeah. And we think that’s a fantastic topic for today. I mean, our show is a Canada-based show. Of course, we we have investors, you know, that are people watching globally, but we’re predominantly based out of Canada. But we do have a lot of people we talk to investors, clients that want to invest in the US. And it’s becoming more of something that’s just becoming more popular today, at least for Canadians wanting to branch out.

So we thought it’d be great to have you on to share with us what we’re seeing in the US market right now. I know you kind of have a good kind of scope for many of the different states and which ones may be more beneficial for people to look at investing in or more affordable than others. So we’re very eager to kind of get that inside scoop from you today.

Kristina: The biggest investors, I have to tell you, are the Sunbelt.

Carmen and Jordan: Yes. Yes.

Carmen: Well, in Canada, it’s very cold. And you know what? I just I have a house in Florida, and we escaped there as much as we possibly can during the winter months. We’ve been looking into investing in the United States and getting all of that organized in. Jordan’s right! It is a huge thing right now. Everybody wants to buy in the southern part of the states for the most part. Also, investing is a big topic for a lot of our clients. And I love the fact that you work in the affordable arena. And you know a lot about that because I think that’s a really excellent place to focus on for real estate investing. And so share some of your insights with us. Let’s start with what does somebody do if they want to invest in the United States? So you’re a person that we can go to and you can direct us to any realtor throughout the United States, is that correct?

Kristina: Correct, yes. Yes. OK, so I have a big referral business and I know real estate agents throughout the country. I end up meeting with a lot of investors that want to put things together, like maybe a tiny home community in a tourist area, or they do want to set up a home park, where they could, you know, have those affordable housing options that they can rent out to people. So if somebody was to come in and I was to advise them, the first thing I would tell them is to meet with a financial advisor. And generally what they’ll tell them is to set up like an LLC or a corporation so that way your assets, your personal assets are protected. So that’s what most people do. I’m not a financial advisor, so always meet with somebody that is a financial advisor on this first. So they set up their corporation and then they buy properties with that corporation. So that way their personal assets are protected.

Carmen: So are you saying maybe see an accounting firm or something like that in the United States?

Kristina: Yeah, I would do that. Yeah, I would definitely do that. I would set that up with. So, yeah, because you’re going to be taxed and everything else. So just make sure you have everything on the up and up. And that way, you know, it keeps everything separate. So you know exactly where the money’s going and coming in and everybody knows it’s all clear, you know, everything.

Jordan: Yeah

Carmen: It is very complicated

Jordan: That’s the major deterrent for people is just kind of knowing where to start, making sure they’re doing everything right. But also a little bit of an unknown of, you know, where do I invest? What are the good areas? I think that your expertise is really going to come in today and, you know, showing people or teaching us where some of the hot spots are right now, what are some of the most affordable states that you’re seeing or areas that might be lucrative spots for investors?

Kristina: Well, I have to tell you, like about two years ago, I would have said, oh, you have to invest in Austin, Texas, and now it’s just like it’s gotten ridiculous. It’s really expensive. I mean, it depends on what you would consider expensive. I know the prices in Canada are a lot more than they are here. Well, what do you say is expensive? It’s like nothing. But there are still investment opportunities all through the south. Florida still has great investment opportunities. You just have to snatch them up very quickly and you have to have a plan in place ahead of time. So, of course, if you go through Alabama, I would look for those tourist areas where people are going to be staying or vacationing there. If you’re working -in the tiny home, affordable housing type of properties, I would try to see if there is around Alabama where the tourist areas is even maybe by one of the colleges and see if you can get some rental properties along there because there’s always going to be people coming in and out. So if you wanted to set up a few of them as Airbnbs and then some of them as like a six to nine month rentals for some of the students, that would be there by the college. The same thing about the coastline, the same exact thing and we mentioned this beforehand, but one of the biggest investment opportunities for people is to find an old park, a mobile home park that has kind of like seen better days or might even be closed down altogether. But the utilities are still there. The infrastructure is still there. You’re going to have to revamp it. You know, there’s that opportunity. But you’re going to have to fix it back up. But the land is there free. The lots have already been set up. And so you could set up these like tiny homes along those lots that are already there. And if it was near a college, you just walked into a goldmine and you’re offering a really good service to people that are having a really hard time finding housing. That is one of the hardest things in the United States. We’re short just over 5 million houses for people to get into. So if you are going to come in here and invest something like that, that is a great opportunity for people that are really looking for an affordable place to live. You’re offering a really good service to them.

Carmen: I agree totally. And it’s actually where a lot of my energies have been recently. I think it’s also a very good option. And I’m not saying recession proof because that’s not there’s no such thing, but I think it’s really a great investment vehicle. If something does happen and the market is going down or turns down, these are the least affected properties, because everybody needs a place to live, specifically smaller the least expensive type properties that we can get.

So I think that’s a brilliant way to go and it would make me feel comfortable. I’d sleep at night having investments like that.So I think it’d be a wonderful opportunity for sure. Absolutely.

Kristina: Well, that’s why the biggest investors, the biggest ones in the United States that are buying up a lot of the houses in the Sunbelt area are buying the most affordable houses in some of the areas that I just mentioned because they know that it is something that is an opportunity and they are hedging their bets against inflation. They have been doing this much prior to the pandemic. They were doing this. I had talked about it on my YouTube channel and like the end of 2018, I was showing how they were buying up Austin, Texas. That’s how I knew that investors were going to be going into Austin, Texas. And sure enough, it’s just, you know, it’s crazy. They were buying up foreclosures prior to the pandemic. So and then Atlanta has had a 25% increase in investors buying up properties in those same areas and those affordable housing areas that are in. You know, that it would be a really good investment to hedge their bets against inflation. That’s what they do. They’ve always done it for years.

Carmen: Yeah, brilliant. It’s brilliant. Well, we do have to go to break. So I just wanted to hold this thought because it’s so interesting for me and I’m sure our viewers are very excited about it as well. So hold on there, don’t go away. We’ll be right back.

Jordan: Hi, I’m Jordan, and this is Carmen. Welcome back to 30 Minutes to Wealth.

We’re here with our guests, Kristina Smallhorn. Kristina thanks again so much for being here today. We’re talking about US investing affordability, so much to dig into in such a short period of time.

Carmen: I know. So we’re going to be the best topic. Exactly.

Jordan: One thing we really wanted to kind of get your take on and I know you’ve done some videos on this is there’s been so much change and so much happening in the last few years. Do you think there is a housing crash coming or what’s your take on this?

Kristina: Well, what really gets people clicking on videos is to say the words housing crash so I know that as a content creator, that’s why sometimes you’ll see that in a video. My personal opinion is that in the last several years, we have seen more and more people buying homes, but they’re not using the same kind of loan packages that they had in the last housing crash. They were buying homes with interest, only kooky loans, funny money, basically, you could walk in with say, I make $300,000 a year, and then all of a sudden, you’re getting a house note for about 300,000. I mean, people were writing loans for people that should have never gotten a house in the first place. This housing market is 100% different. The people that are buying homes now are highly qualified. They’ve been thoroughly vetted. It takes a long process to make sure that they are going to be qualified buyers. They actually make sure they’re fully qualified before they even put offers in their house so they can get their houses moving quicker.

Carmen and Jordan: Yeah

Kristina: So not only on top of that, I’ve never seen as much cash as I’ve seen coming into a housing market as I’ve seen in the last two years. It is absolutely crazy. So even though they’re buying the house that a full asking price of, let’s just say, $550,000, they’ll offer another $150,000 cash on top of that offer. So they’re only financing, you know that with a 20% down and everything else, they’ll still finance that and then add their cash of $150,000 to secure that house. That has not been the case in any other housing downturn. If there was to be a housing crash, there would be a financial disaster in a lot of other sectors to allow for the housing market to dip as low as people are probably wanting it to. We’re not going to see numbers of housing going down like we did after the last housing bubble that burst. There is going to be a flattening. These, these rates, these prices can’t go to the moon, you know, like at some point they either have to slow down or flatten out before they start falling. It’s going to take some time. It’s not going to happen by the end of this year. And I just can’t see what will cause it to crash. We still don’t even have enough of the houses built in the United States. We still don’t have enough houses built. They haven’t built enough houses since the last housing bubble. Builders. I’ve been scared to because they don’t want to lose their shirt like they did in the last downturn.

So we’ve been down on new home construction and there’s been constraints with that with the supply chain so that even if they wanted to build enough houses right now, they couldn’t.

Carmen and Jordan: Yeah

Kristina: And then the houses that they’re building are not going to be the houses that I would consider affordable. Those are going to be for people that have a lot bigger, deeper pockets because, you know, they only have a little bit of space. They’re trying to build that as much as they can so they can get as much money as they can out of that little space to build a house. I can’t really blame the builders for that. So there are a lot of opportunities if you’re able to develop a piece of land. There are a lot of opportunities, especially if you’re going to do affordable housing options and if you’re going to do those affordable houses where you can rent them, another huge opportunity. Rent prices here in the United States have skyrocketed in some and Austin, Texas, for example, in one year it went up 35%. So we have a lot of opportunities, especially in the Sunbelt area. And that’s why, the big investors invest in it.

Carmen: Well, can you share some key areas with our viewers of where you think?

Kristina: I will tell you where my investors have gone this year, which blew my mind. But they know better than I do because they know where to move their money. And a lot of people have -been going into Kansas City, Missouri, and a lot of all through Arkansas. 

Jordan: Interesting! 

Kristina: Like near the Ozarks, all through the Ozarks. But they’re like they’re doing what I’ve been talking about, which is they’re finding old manufactured home parks that have been either abandoned or on the near end of its life kind of thing. They’re going through the revamping them and they’re putting in these luxuries almost like glamping.

Carmen and Jordan: Yes. Yes.

Carmen: That’s the biggest thing right now.

Kristina: Yeah. That’s what they’re doing. And then because it’s in a vacation spot,

they know that it’s only going to make the money for X amount of periods of time.

So then they make it also for short-term rentals. So they can do it for like six months. You can rent this out here, you know, in the area. And then, they turn it into an Airbnb for the next six months, or they have a section of that area that it’s for people that are full-time renters and then the other areas for the glampers on the other side. 

Carmen: So it’s become a big trend. I think a lot of people are looking at that and as I mentioned earlier, it’s something to feel comfortable about. And trailer parks used to be really gross,

like who wants to buy a trailer park, right? It wasn’t something you wanted. Now it’s just slowly starting to trickle. So, guys, we got to buy it quickly before everyone else did. But yeah, it’s awesome. 

Kristina: It’s a great investment opportunity and it has been for many years. I used to say my biggest dream was to own three trailer parks and people are like, what are you talking about? I’m like, they always pay on time. I actually own one rental property that is a manufactured home, and those people pay on time every time. Cash. Gosh, I love those riders. So they’re the best.

Carmen: Yeah, that’s awesome. Excellent. 

Jordan: Now, what other areas are you seeing? Like, are you seeing investors going into the Tennessee area? Because when we were spending a lot of time in Florida, I know some of the pockets in southwest Florida, the locals are actually choosing to move away from there

because there’s just like the prices are getting driven up so much, I think, with all the

foreign investment coming in. And so they’re kind of bridging out, kind of like what we’re seeing in Canada, like people are kind of going to outskirts, yes little bit smaller communities. And we’re hearing, oh, I’ve heard of a lot of people moving up the coast, the northeast coast and even into Tennessee and buying there because apparently land is quite cheap still depending on the area.

Kristina: But I would caution anybody that’s looking into an area that you’re not familiar with is to get with a real estate agent. And, you know, some people are like booo, you know there is a lot of real estate agents that know a lot about their specific area, especially somebody that works with a lot of investors in investment areas. They know what like foot traffic is. They know what areas are vacation spots they know which areas have the highest taxes. They know -which areas are going to not give you as much guff -about building what you want to build on those properties. So I would strongly suggest, especially if you’re not from that area, work with a real estate agent that is proficient and knows that state very well. It was worth the weight in gold.

Carmen: Yes. I absolutely agree with you, 100%. And another thing is you pay that. If you have to even pay for the commission, it’s worth it. I deal with realtors. I never negotiate commissions. They need to get paid for their services just like anyone else in the industry. And if you pay somebody, they’re going to do a good job for you. So don’t try to negotiate every little penny out of them. It’s very important.

Kristina: Now, I have to ask this because I’m not very familiar on how real estate agents get paid but here in the United States, the sellers pay the real estate agent. The buyers are represented, but the sellers are actually the ones that pay at the closing table for both sides of the transaction. Is that the same in Canada?

Carmen: It is. But now the market has been so steaming hot that the sellers are saying, OK, buyers, you are paying the fees. So they might get 1.5% from the seller and then they’re going to say, OK, -you got to pay the other 1.5 or if you have your own realtor and you want to present an offer to a project or a property, they’ll say they’re not working with any other agents. But if you want to come in with your client, you have to take care of it.

Kristina: So interesting. I mean, this is a crazy market and this will turn around again

because I remember after the last housing bubble, they were like, we will give you 3%, plus a bonus of another 3000%.We’ll give you our dog, our refrigerator.

Carmen and Jordan laugh

Kristina: And apparently if you buy our house. So, I mean, I guess just like anything, everything that goes up, comes down again. We get back to realistic things like, hey, this is crazy, this is the craziest real estate market ever. In a million years, I would have never thought that home prices would have gone up, as high as they did. It’s crazy because even at the start of the pandemic, I’m like, who wants people to come to their house and might be sick? And then I was like, wow, I was worried about that. Like, why?

Carmen: It’s really a crazy thing. Like the whole thing. I mean, the market has just exploded everywhere, though. It’s not just, you know, in the southern states 

Kristina: Worldwide.

Carmen: Yes, it’s worldwide.

Kristina: Australia is seeing insane price increases like they have like I love to watch their market because what they do, I’m like, Oh, thank God we didn’t do that here in the United States. Like Woah. Because they thought what I thought. I thought they were like, oh, this pandemic’s going to affect the housing market, right? So then they decided to offer a first-time home buyers package to people. What did that do? It made it even crazier and their home prices went out way, way, high, way, way. And they don’t have the infrastructure to build out.

You have to build in the city. So it’s been really bad for that. Really bad.

Jordan: So, Kristina, our time is almost up. Are there any last words of wisdom you could share with our viewers before the end of the show? 

Kristina: Well, since you do have a lot of investors from around the world, I would say that no matter where you’re looking to invest, always make sure you find a real estate agent, like I said earlier, proficient in that area. And even though they may say that I cover all of the United States, only pick one that works for that specific state, I know there are lots of people that say I work three different states, but they only know one state really well.

Carmen: I agree 100%.

Kristina: Wisdom

Jordan: Awesome. Well, thank you so much for joining us today. If you’re interested in learning more about real estate investing, you can go to 30MinutesToWealth.com to see the rest of our episodes.

Carmen: That’s it. Our time is up. Go create wealth.

S5 E01 – How to Recession Proof Your Portfolio with REC Canada

Carmen and Jordan Campagnaro meet with Simeon Papailias and Jacob Campagnaro from REC Canada. Founded in 2000, REC Canada is a multiple award winning leader in real estate sales and consultation, spanning across all classes of real estate and investing. Simeon and Jacob are both seasoned realtors and investors and we welcome them back as a show sponsor to share knowledgeable insight when it comes to investing in the current market. 

In this episode, we discuss some of the key strategies used to recession-proof real estate investment portfolios using multi-residential income properties. We talk about some of the hot spots to invest in right now as well as investing in retirement related real estate, a strategy that is quickly on the rise.  This is an incredible information packed episode you won’t want to miss!

Read the Full Episode Below

How To Recession Proof Your Portfolio S5 E1 

(Note: This transcript has been modified for clarity purposes)

Carmen: Hi, I’m Carmen. This is Jordan. Welcome to 30 Minutes to Wealth, the show that teaches you how to build wealth through real estate.

Jordan: Today on the show we are so excited to be talking about how to recession proof your portfolio. Simeon and Jacob from REC Canada are on our show today, and they’re going to teach us some really amazing things about how to get into real estate and what to invest in. They are the sponsors of our show, we’re so grateful for that. Don’t go away.

BREAK

Jordan: Hi, I’m Jordan, and this is Carmen. Welcome back to 30 Minutes to Wealth Today. We’re here with our guys Jacob and Simeon. Guys, thanks so much for being on the show today.

Jacob: Yeah, thanks for having us on.

Simeon: Our pleasure. 

Jordan: Yeah. We’re going to dig into some really exciting topics. How to recession proof your portfolio but to start with, how are you guys on the show? A couple of times have always been such a wealth of knowledge. You’re a sponsor of the show, 

Carmen: Which is so appreciated. Thank you very much. 

Jordan: Love to have you guys here. But for those maybe just tuning in, tell us a little bit about yourselves and maybe what you’re up to lately.

Simeon: Yeah, well, my name is Simeon Papailias the co-founder of the REC Canada Group, which again, a lot of the audience has seen us before. For those who haven’t, we are a 100% dedicated investment focused real estate group. We have a commercial division and a residential investment division, both of which amount to about 800 to 1000 transactions per year. So we represent a lot of investors. We have our finger on the pulse of the investment market, and no matter what the market conditions are, our insiders have come to trust our insight. And we gather that from people like yourselves, from other economists, and all our strategic partners. So we want to be, we strive to be the best source of insight and education on making great decisions in the real estate investing space.

Jordan: Yeah for sure. 

Simeon: Jacob heads our entire commercial division, meaning that any asset above four doors at the minute you get into commercial real estate, that’s where he has his strengths, like his background, his education, his experience lie in really taking his clients and our clients through the entire due diligence process safely, accurately, where our clients win. And that’s what we strive to do.

Carmen: Yeah, you’ve done an amazing job, and I’m so proud that Jacob is actually part of your team. It’s amazing.”

Simeon: Jacob is actually part of your family.

All of them laugh together 

Carmen: So I say yes.

Simeon: But that’s the amazing backstory, obviously. And then generations of real estate. And although we’ve spent so much time training Jacob to be the absolute resource he is today, he brought a wealth of knowledge with him, which is why it’s so natural. So kudos to your entire family for the generations of real estate. I had.

Carmen: Yeah. Well, thank you. Well, that was amazing. 

Jordan: Yeah, what an intro. Well, today to start, we really want to talk about multifamily real estate. I know, Jake, that’s one of your specialties. And we’ve touched on this a little bit, but let’s kind of talk to us a little bit about why this makes for a good investment, why an investor should look at multifamily.

Jacob: Oh, yeah. So like today we’re going to be talking about recession proofing your portfolio. Right. And right off the bat, I put up my hand and said, hey, we got to talk about multifamily, right? I think it’s a fantastic investment, too. Recession proof. It doesn’t be it isn’t affected by the market the same way. Let’s take, you know, commercial retail or commercial offices. Right. Hard times, good times. People need to live, they need to rent. Yeah, right. Even more so. In the hard times, right? If you’re owning that lower middle class apartment building, that’s really when your vacancy is down. Yeah, right. People need to rent. Housing prices go up, housing prices come down. People are still going to rent.

Carmen: Absolutely. Right.

Jacob: Yeah. You know, even today we’re looking at across Canada vacancy rates under 2%.

Jordan: Yeah.

Carmen: Yeah, right. 

Simeon: And that’s only and that’s in every single urban market, whether it’s Vancouver, Toronto, Calgary or Montreal.

Carmen: Same ones.

Simeon: The only common denominator is the fact that vacancy is well under 2%. Every single one of those markets. Yeah. So that whole Canadian shortage of supply is very real, which makes this asset class of owning multifamily so so in demand.

Carmen: And it’s so difficult to find, yeah. And you know, and immigration is another factor. You’ve got so many people coming into our country and housing, it’s a crisis. Yeah. And so I totally agree with you on this side with the multi residential, it’s always been my favorite multi rising commercial.

Jacob: So yeah, yeah. It’s just not being developed the same way single family is or you know, even commercial. Right. It’s a key asset class.

Jordan: Absolutely. Now with the market being so high, like where do people find these multifamily. Yeah. Jake, we’re in a good spot Jake.

Jacob: That’s, that’s basically my life. OK, yeah I know. So it’s, it’s like my thoughts to it is yes you can always buy in the population centers right. There’s going to be minimal inventory. It’s going to be the most expensive place to buy as well. Right. So you know when we’re in a recession time or a down market time

Carmen: Even even in an up market time

Jacob: Even in an upmarket time.

Carmen: Any time.

Jacob: Yeah. I like to look at tertiary markets.

Jordan: Yes, right.

Jacob: I like to go outside of the population centers. Yeah, right. And we look for key things. We’re going to look for employment nodes, transportation nodes and health care nodes.

Carmen: Yeah, right.

Jacob: Meaning OK. Is there a university campus? Right. And we’re not having student rentals, but everybody that works there, everybody that’s involved with that needs a place to live, right? Same with health care. Same with, you know, bedroom community, which essentially is, you know, that transportation node. Can we go from the small town into the big town quickly and efficiently? And those are the markets. Those are the key markets and my favorite markets to invest in.

Simeon: And we can see the evidence all over. If we look at the growth, if we want to pinpoint an Ontario, for example, and we look at Toronto versus the outside of Toronto, that the record growth over the past few years of 30 and 40 and 50% capital appreciation across all asset classes happened mostly centered in those tertiary markets that you’re referring.

Carmen and Jordan: Yes. 

Simeon: If you want to look at Oshawa look at Kingston, Ontario, the hottest market in the entire province and nobody talks is it? It is, yeah. You want to look at Bell pilots out of Ottawa, Gary, to the north of Toronto, Hamilton to the west. Yeah. Hamilton is a story that you could write books about.

Carmen: Brantford.

Simeon: Bradford, Ontario, Paris, Woodstock. You got all these? 

Jordan: Yeah, London. 

Simeon: So all these locations, the reason they present such a tremendous opportunity is because as the people, as the residents of Toronto, of Oakville, Burlington, of Hamilton, as those markets appreciate, those residents saw the opportunity to cash in, not be debt free and be able to invest in real estate in a market that is 20, 30 minutes away from them, say as  Toronto has very high income people come into Toronto to afford $2 million a 1.5 average, that is replacing in displacing someone who is moving to Burlington which used to be 800 is now one and one half.

Jacob: Yeah

Simeon: And then the person for Burlington is replacing Hamilton. They used to be 400 with 700, 700 to 400. So that whole drive to your qualify and natural evolution of any market is happening right in front of our eyes in the multifamily sector that we service and we service diligently is exactly, where the opportunity lies for stability inside our portfolio.

Carmen: Yeah, absolutely.

Jacob: Yeah. I always say it’s like a pebble in a pond. That’s right. Every time it ripples out. So let’s find that ripple before it happens or try. Right. That’s the smart investment.

Carmen: Yes, exactly. And you have to find the little communities that you know, most people wouldn’t even know about. And that’s where you have to see what you can find.

Jacob: Yeah. For example, look at Fergus. Yeah, we all know Fergus very well. We found a cottage up north, so we driven through it a million times. Yes, literally. And Fergus was this very small town, but it’s, what, 10 minutes? 50 minutes to Guelph and now you look at Elora right now. Elora and Ferguson almost merged because of the expansion they’ve had.And it’s just become this booming community. 

Jordan: Yeah. It’s very cool to see these transitions of these small towns, and it’s been looked over, and now we’re all of a sudden.

Jacob: But it’s happening in our lifetime

Simeon: Like it’s happened in the last eight years. So I know about I mean, like, I remember driving through Elora with my motorcycle crew. We used to have a little club to go through the back roads, and the Elora was one of those like, let’s go to a Elora because it’s so beautiful. Well, you’re driving through like construction and subdivisions now and it’s like, what happened to Elora? Where’s the ice cream shop? So yeah, it’s very interesting to see the growth.

Carmen: For sure

Jordan: And maybe Simeon and you can shed some light on this. If an investor wants to get started investing in multifamily, how can they approach this?

Simeon: Yeah, I mean, we have a lot of systems in place and this is kind of where where we set where we believe we set ourselves apart in the marketplace is that we have set up a very systematized approach to this, because it is very exciting to hear us speak about multifamily with so much passion. It is because we invest in it. We’re investors too.

Jordan: Yeah. And we can see that passion. Oh, we absolutely love it.

Simeon: Well, Jacob puts every one of his dollars into real estate before he even earns it. But anyway. Not a lot of people love real estate more than this guy. But to do it, we’ve set up a system where it literally safeguards you from yourself. What can you expect from that? You’re going to be able to book a time where you have to speak about your goals. You have to say, I want a 20 unit apartment building. Well, if you’ve ever done it before, that may not be the best thing.

Jordan: Yes.

Simeon: Although it’s exciting or easy. Oh, no, I can just get a property manager. What if the margins aren’t there? Yeah. What if the plan is to renovate it first to escalate the rents. This is an asset class, where literally the sky’s the limit and every single opportunity presents different challenges. 

Jacob: Yes.

Simeon:  If we have enough time, I would love to share some of the challenges that we’ve gone through. But the best way to go about this is by booking what we call a real estate action plan, where Jacob and his team literally will take you through the process and really determine which type of investment is right for you. 

Jacob: Yeah. And when we go in, we go deep into the investor themselves. Right. So what other investments do you have? Are you in stocks? Are you in crypto? Are you in commercial, residential, like we, you know, to really understand where we should put that investor and how we’re going to purchase.”

Carmen: We’ll hold that thought. Jacob, we have to go to break. And I’m really excited to share with our viewers what the requirements are to get involved into a commercial multi residential type investment. So don’t go away. We’ll be right back.

BREAK

Jordan: Hi, I’m Jordan, and this is Carmen. Welcome back to 30 Minutes to Wealth. We’re here with our guys Jacob and Simeon. Guys, thanks again so much for being here. For those that are just looping in, we were talking about investing in multifamily. So right before the break, we were talking about how you can go to your website. Lots of information between the two different resources.

Jacob: Yes.

Jordan: For those that are wanting to get involved in multifamily, what kind of criteria should they look to have? You know, is that something that you can help them identify when they contact you? Yeah.

Jacob: Yeah. And it’s and as Simeon mentioned earlier, we’re going to do the intake, right? That’s step one. But what does the investor need to know before we do the intake? Right? Is multifamily right for me right? Or is there because there’s a million investments? Yeah, right. And we can get into those in another episode but what you said Jordan with with the podcasting was actually a perfect segway into that right and I think investors should be educated right learn about multifamily. Yes I will teach you as much as I can possibly teach you but come in listening to the podcast right. Get excited about it.

Jordan: Understand what you kind of want to do before.

Simeon: So what’s the capital required like what is like if I have 30,000 can I buy an 18 unit building the answer is no?

Jacob:  No. 

Simeon: So, so you want to elaborate a little bit like yeah. So profile. 

Jacob: Right, exactly. So okay, we come in scenario one, there’s two scenarios I’m going to, I’m going to put forth here, about scenario one is, you know, I’ve just sold my house, I’ve just refinanced my house or sold my cottage, whatever I come into. So I have some capital you’re going to be looking at anywhere from 20 to 30% down, meaning that’s where the cash that’s put down on the property. As of right now, the typical multifamily in Ontario, you’re looking at anywhere between 150,000 to 250,000 a door, right. So you can kind of do some math and put some pricing together there.

Simeon: Well why don’t we do that. I think we can because at that ten plex let’s call it on the mid range of 200,000 of doors. 

Jacob: Yeah. Perfect. 

Simeon: Exact $2 million if it’s 25, 20, 25 30%, let’s call it 25% again. Yeah, we’re talking about half a million bucks needs to go down. It’s just that closing cost you have closing costs it’s that simple. So unless you have access to actually 5 or $600,000 it’s not the right asset class. Yeah.”

Carmen: Yeah. So you can partner with somebody. You can. Right. There’s all sorts of ways of doing it and.”

Jacob: That’s exactly it. Right. And then you have the, the option two which I want to talk about which is a value add play. Yes. Right. I know you mentioned that a little bit earlier, but you know, so the investors who are very educated, very savvy in investing and that’s where the podcasts come in. Right. Understand what a value add play, what a BRRRR is, right. 

Carmen: And what is a BRRRR?

Jacob: Well, so it’s a buy, reno, re rent and refinance, right? And repeat if you want.

All of them laugh

Jacob: And and essentially what you’re doing there is you’re going to be coming in with private money or B money or something of that nature, to acquire the property at a low cap rate normally because the rents are low. Right. And the banks are going to look at and say, I’m not funding etc.

Carmen: Now people are going to say, what’s a cap rate? I’m sorry, I’m going to again of course, because I just want to talk quickly. I guess.”

Jacob: Yep. You  take it away. Cap rate. Sure. Yeah. 

Simeon: Cap rate is the capitalization rate is what it actually stands for. And it’s the return of capital based on your purchase price. Versus the net income. So it’s that simple. It is the purchase price over net income. That’s gross capitalization. Yep. So to calculate that and begin let’s break this down to the basic principle.

Jordan: Yes.

Simeon: If the building is $2 million and the income is $200,000. If you divide one into the other, you’re going to get to your cap rate that’s right. Whether it’s a high cap rate or a low cap rate, you want to buy at the highest cap rate possible. So when you’re looking around and this is not easy concept to understand in 2 minutes, that we’re spending here.

Carmen: Yes.

Simeon: And I welcome and I invite everyone watching to understand the fundamentals of real estate on our website. So these resources and we can take all the time in the will. You can take all the time in the world to watch our content. I know we’ve explained this before on this very show.

Jordan: Exactly

Simeon: So the resources are there, capitalization rate you want to get at the highest possible and you want to sell it at the lowest. Yeah. That’s called Cap compression. So it is an actual investment method. Now it is my personal favorite. That’s what I do. But it’s also the most complex to understand and do. Not that it’s difficult, but you have to have done it before or you have to have the right people guiding you into the investment. That’s it.

Jordan: That’s right. Now, Simeon, we in general in this episode, we want to talk about how to recession proof your portfolio. One thing we really wanted to talk about was retirement homes and how this whole new segment of the population is coming into retirement and what kind of needs and opportunities there are going to be for investors. Can you talk to us a little bit about this?

Simeon: I mean, this is really, really big news right now.”

Jordan: Yeah.

Simeon: In 2022, we literally just had the census, the Canadian Census come out, which comes out every decade. And in the population of Canada, as predicted, is getting older. And that is not good news in any way, shape or form, meaning that if we’re not having enough children, we’re going to continue to rely on immigration to solve our workforce, our labor force, which just saw 20% of its skilled trades going to retirement.

Jordan: Wow!

Simeon: So when people say why are prices going up if we cannot build as a country if we can not have enough construction starts to replenish the supply and we need skilled trades to do so, we could not have 20% of bricklayers come off and not have a backfill.

Carmen: Yeah.

Simeon: So we just can’t have that. Yeah, it’s not functioning. And this is adding to the supply issues that were generated by the pandemic not long ago. So even past or even post-pandemic at this point when we have an aging labor force when we have these issues come to life, these also create massive opportunities because all of these people retiring are all going to have different needs and I’m talking to retirement homes, I’m talking to memory care homes, independent living for the seniors, assisted living for the for the seniors who need a little extra hand. Everybody’s to take income homes now there is no son or daughter readily available to help their parents anymore. Unaffordability of homes is driving both couples now to work. Whether they’re their partner has to work. The other one has to cover. It’s not the same setting of 50 years ago where you could just take your aging parent into your home and be able to help because we’re not available.

Carmen: You’re right. You’re so right. 

Simeon: But we’re seeing this. We’re seeing tremendous opportunity. What are some of the opportunities that you’ve seen in the last few years? Because we’ve worked through some pretty significant projects. 

Jacob: Yeah. Yeah, it’s a question. It’s a question I get when I’m working with investors, which is, you know, do you expect me to build a retirement home? Right. How do I invest in a retirement home? There’s many ways I’m going to touch on a few. I’m going to let Simeon touch on a few. But very, very simple. You can look at investing in, let’s say, a REIT. A real estate investment trust. Right. 

Carmen: Yeah, I know about this! 

All of them laugh

Jacob: And what you’re you know, so yes. You’re not directly owning, you know, the building. You’re not putting the bricks in yourself. But you do own the shares in that building. Right. And you are appreciating with that building, right? With that asset class, right. And that’s so important for people, especially the husband, wife, both working, you know, and then they’ve got to come home and then they have to think, OK, now I gotta go buy some land or I gotta go buy a building or something like that. There’s only so much time in a day. And for some people, that’s the right path. 

Simeon: But let me put a super clear in the GTA, the greater Toronto area right now, there is a ten to one ratio of available beds to the demand. There’s a minimum two year waiting list. We’re not talking about government assisted living that’s a four year wait. So that the homes that are not up to par, not somewhere where you would want to put your loved one, but you have to have two to three year plus wait lists and they look like hospitals. But for cutting edge state of the art buildings, there’s just not enough built. So the major players in that game are scrambling to rezone land to get those in. So if you are interested in finding out more about how to invest in retirement homes, it is a very passive method of investment. It’s a very lucrative asset class and it’s by far one of the most stable investments you can make because the country factually has a massive demand. The country factually is aging faster than ever and the supply just doesn’t exist now.

Jordan: Well, you have me hooked on this.

All of them laugh 

Simeon:For anybody, like just looking to just get into it. If you visit the Canada Mortgage Housing Corporation website, I’m not I can go to my website. I’m not talking about going to the Government of Canada website to look at the census. 

Jordan:Oh, yeah.

Simeon: Go to CMHC, which is a Canada Mortgage Housing Corporation to see the average price per bed in retirement. They track the asset class literally too within 60 days because it’s such a hot, hot button issue. So everybody in this audience should be excited about it. The returns are well into the 20% per annum.

Carmen: So how is that through what? 

Simeon: Whether they invest in a REIT that specializes in the space, right? Whether they invest in an actual home look where they can buy condominiums units, whether they invest in, in mortgage and private financing for the construction of these homes. Right. There’s a myriad of tools  and opportunities. And there will be more and more as we progress through this.

Carmen: You’re right, absolutely. 

Simeon: It wasn’t long ago that you’re affiliated with bought a site in southwestern Ontario.

You know, to put the site on blast, but that’s a tremendous play that you’re working.

Carmen: Yes. Yes. 

Simeon: And how do we know that’s going to look in the next two years? What opportunities will arise out of that?

Jordan: That’s great for people to have this on their radar because it may not be the first thing they’re thinking of. It’s just really a great opportunity that’s presented here.

Simeon: The asset class itself is going to be shining, an opportunity left and right because we are so behind and there’s not enough people doing it. So there’s going to be a lot of money to be made in creating the infrastructure that will help the actual citizens of our country.

Jordan: Well, thank you guys so much for coming on and sharing with us. This was such an information packed episode, and I think everyone is going to get so much value here. 

Carmen: I got value. 

Jordan: And I love chatting with you guys. It is so engaging. You’re so passionate, but love it.

Jacob: Thank you so much for having me

Jordan: So if you’re interested in investing in some of these properties that we discussed today, you can contact Jacob directly at REC and for more information on real estate investing, you can go to 30 minutes to wealth to see the rest of our episodes. 

Carmen: This was an amazing episode. Thanks again. Go create wealth.

 

S4 E16 – Getting Smarter with America’s Rich Dad

In our Season 4 Finale episode, Carmen and Jordan Campagnaro meet with Robert Kiyosaki, investor, entrepreneur, educator and author of the #1 best selling personal finance books of all time, Rich Dad Poor Dad. Kiyosaki has challenged and changed the way tens of millions of people around the world think about money and is arguably one of the most influential authors worldwide when it comes to investing and pursuing financial independence.

Robert Kiyosaki has been a long time inspiration and mentor for Carmen. We were very excited to have him join us to talk about his perspective when it comes to the market, investing, real estate, and constantly getting smarter. He shares that there is no risk-free investment, and constantly educating oneself is the best remedy to decreasing risk when investing. This episode offers an informative and fresh take on achieving success for novice and experienced investors alike.

Read the Full Episode Below

Getting Smarter with America’s Rich Dad, Robert Kiyosaki S4 E16 

 

(Note: This transcript has been modified for clarity purposes)

Carmen: Hi, I’m Carmen, this is Jordan. Welcome to 30 Minutes to Wealth.

Jordan: The show that teaches you how to build wealth through real estate. Today we are very excited to welcome a very special guest who has a best-selling book that is arguably one of the most influential and important real estate books worldwide. 

Carmen: I love this person, he’s been my icon for many many years. Robert Kiyosaki is going to be on our show today to provide his insight in real estate. You need to see this, don’t go away, we’ll be right back. 

BREAK

Jordan: Hi, I am Jordan and this is Carmen. Welcome back to 30 Minutes to Wealth. Today we are welcoming a very special guest, Robert Kiyosaki, on the show. Robert, thank you so much for being here today.

Carmen: Thank you

Robert: Oh thank you, it’s nice, I’ve never spoke to a mother-daughter team before, it’s kind of interesting 

Jordan: I love it.

Carmen: Jordan was born and raised in the real estate world. 

Jordan: It’s true.

Carmen: And I am thrilled to have you here personally because you’re a great inspiration to me. You don’t know it but I went to an event in New York City and you were there with Donald Trump. I don’t know how many years ago that was about 15 years ago I think. 

Robert: Yeah, the Javits Center.

Carmen: Yes and I met you there, we took pictures together, you probably had a million people there but-and you really inspired me with your story about you know all these courses and people going to these investment training companies and complaining and being negative about it and your spin on it was don’t think about the negatives just-it gave you that kick in the butt to do something and make it happen. That was a really awesome day for me and I read your book and you signed many of them so that was really great. And from there on in, I mean I’ve been investing since I was 18 in real estate and I absolutely love it. But how did you get started, how did all of this come to be? 

Robert: Uh, the story of “Rich Dad, Poor Dad” is a true story. You know my poor dad has a PhD from Stanford and Northwestern University of Chicago and PhD stands for ‘Poor, Helpless, and Desperate’ and we learn nothing about money at school. So I was about 10 years old, growing up in Hawaii, I kept asking my teacher: when do we learn about money? And my teacher was a church lady like on Saturday Night Live “The love of money is the road of all evil”

Carmen and Jordan: (Laughter)

Robert: I am 10 years old and I am going…maybe evil to you lady but I want some money and that’s how it kind of started. So that’s when I went to find my rich dad. My rich dad was my best friend’s father in this little town called Hilo, Hawaii. This town is the most southern in the United States, further south than Miami. And so, we’re in a little hick town and that is when I went to see my rich dad and I said I want to learn about money and the way he taught us was by playing monopoly and so we all know about formulas for greenhouses red hotel. So today, I own a massive-I have about eight thousand rental units and several hotels, I’m in commercial real estate, I have businesses but I’m basically a capitalist

Carmen: Yeah

Robert: And I don’t trust my government, I don’t trust the Fed, but I did fight for America. I’m a US marine, I was a pilot, but I fought in Vietnam twice. I do fight for freedoms. I don’t care if you’re a communist or a Marxist or a capitalist just leave me alone let me have my freedom. Don’t take my money.

Carmen: Here, here. 

Jordan: Agreed. 

Robert: What do I know about money? It’s the reason I’m in real estate. It’s because I use debt and don’t pay taxes. Legally. And if you’re paying taxes that means you have bad tax advice. 

Carmen: Yes, yes, I got it. Wow, well, okay so we understand and we’re on the same page with you there. Now, what investments do you think our guests…our viewers should get into from a real estate perspective in uncertain times? What if something God forbid happens or if there is a recession, what type of real estate do you think would be-

Jordan: Something that can stand through-

Carmen: Weathering the storm?

Robert: Well, the number one investment is your financial education. You know, because if you’re stupid, you’re going to lose your money. I don’t care what you invest your money in. So, when I talk to a poor person, I don’t care if they have a PhD. When I came back from Vietnam in 73 the first thing I started doing was taking–I mean  I hated school, but I liked learning about money so in 73 I started taking real estate courses, I took stock courses, I basically immersed myself in what’s called “financial education” but people think I’m a real estate guy. I’m not. I have over a billion dollars in debt in real estate. If you can understand that you can understand that I’m really an investor in debt and the more debt I have, I pay no taxes. 

Carmen: Interesting. 

Robert: So, the reason I was in Toronto with the Toronto Stock exchange is because I learned more about the stock market by taking three companies public. I took a Chinese company public and we struck gold and then I took a company from Argentina public, and I still have it, it’s making me millions and millions and millions of dollars. And then I took an oil company public out of Portugal and people said there is no oil in Portugal and I found out the hard way that there is no oil in Portugal. But that is how I learned, I learned by doing. The reason most people are not successful is they went to stupid school. They tell you don’t make mistakes. How in the world do you learn if you don’t make mistakes? How do you learn to walk if you don’t fall down? So everybody said they want the guarantee, they want the low risk and all that. I said you’re an idiot, you went to school. Don’t go to school, take real estate courses, take stock courses, take investment courses, hang out with rich people, don’t hang out with poor people who are highly educated. It’s really common sense when you think about it. My friends are all multi-millionaires. My best friend just sold his business for two billion dollars. 

Jordan: Wow. 

Robert: He never went to school. 

Carmen: Well and I will say, I totally get it but the majority of the people out there, they’re trained as you said to, you know, pay down their mortgage, invest risk-free. 

Robert: But how do you do that, that is the biggest load of crap I’ve ever heard. Even if you buy gold, the price of gold goes up and down. So if you bought gold at let’s say 2,500 an ounce, today it’s about 1,700 an ounce, you lost money. 

Carmen: Yep. 

Robert: There is no such thing as risk-free and all I’m saying, I said to you, I hated school but I never stopped studying and when markets crash, I am not kidding, as I am watching today, I don’t even know what today’s date is even, but I am so excited because it’s crashing, that means all of this bubble, the air is coming out of the bubble and now I’m going to get rich because all of the stuff that is crashing goes on sale. Just like Niemen Mark saying hey we have a 50% off in our shoe department and I know you two would be there. 

Jordan: We sure would. 

Robert: If Niemen Mark said guess what our shoe, we’re going to raise the price 100%, I’ll say no I’ll just wait but what happens is, idiots, when Niemen Mark raises their shoe prices by 100%, they’ll rush to buy some. Can you be that stupid? Yes, people are. It’s called FOMO – fear of missing out. 

Jordan: Yeah.

Robert: Okay so there is no such thing as risk-free and the thing is the best way to get rich is don’t do what idiots do and that’s why I’m constantly studying. 

Carmen: Now, what are you studying?

Robert: Markets. You know this guy Dave Ramsey in America, he says live debt-free. Are you nuts? You know Suzy Orman says cut up your credit cards. Are you nuts? How do you live without a credit card? You don’t understand what is called a monetary system, but I study, I understand the financial markets. That’s why I was in the Toronto Stock Exchange figuring it out. I said how are you guys ripping everybody off, how does a stock exchange rip everybody off and once I found out I said okay now I know how to play the game. You know Warren Buffet said best, if you’re in a poker game and you’ve been there for 20 minutes and you don’t know who the sucker is you’re the sucker.

Carmen: Robert, hold that thought. Awesome, interesting topic. We’ve got to go to break, we’ll be right back, don’t go anywhere. 

BREAK

Jordan: Hi I’m Jordan and this is Carmen, welcome back to 30 Mins to Wealth. We’re so grateful to have Robert Kiyosaki on the show today and Robert you’ve been sharing some really interesting stuff with us today. Picking back up, I know you’ve invested all over the world and we love to hear your thoughts on Canada and the Canadian market. 

Robert: The biggest deal of my lifetime was what I just did on TSE. It’s in the green new deal. Toronto and Canada, you have some fantastically smart people, but your system is socialist. I’m a capitalist, I am not a Marxist, I’m not a socialist like most Canadians are. Okay. I am a capitalist, that’s why I hang out at VSE and TSE. That’s why I know Toronto so well. Okay so, understand I’m just shifting your attitude towards it if you’re looking for risk-free, it means you don’t know what you’re doing. That means I’m just going to sit here and take your money one day with something. I’m not going to steal it from you, you’re going to donate it to the market and that’s my message to people. So, you know YouTube has more programs as real estate courses, the stock course, and all that. I take them and I wouldn’t be living in fantasia, you know Walt Disney’s Fantasia. What if it talks about “ah we’re gonna get we’re gonna buy 100 million bitcoins and we’ll live happily ever after. Well, bitcoins are crashing today too. 

Carmen: Oh, so time to buy bitcoin? (Laughter)

Robert: But that’s what people are waiting for is me to give them a tip, okay so if you understand that so I’m encouraging all of you to listen to – your listeners to listen to your program, get educated, get smart but eliminate the words I want risk-free. There is no such thing and crashes are really really good times to get rich so I’m very excited, I’m happy. You know, unfortunately there are millions of guys, old guys like me, I am a baby boomer, I am 74 years old. Well, they’re wiped out. They are, you know what, you guys have RRSP, we have 401k. Yeah. You know they’re gonna get wiped out. But the reason I was on TRC Toronto Stock Exchange is I wanted to find out how people in the stock market rip people off and the same as in real estate. There are always crooks everywhere, you guys know that. So, if you actually can sit there and believe that risk-free, we can, we’re going to sing Kumbaya, that’s what I’m after is that attitude. Please understand, there is no such thing as risk-free. So, if I can leave you with that, the more you study, your chances of success go up, your risk goes down but there is no such thing as an investment that is risk-free. 

Carmen: Well, that’s uh, thank you for those words of wisdom. 

Robert: You’re looking at my chair in the ESP and the I. 

Carmen:  Yes.

Robert: Okay, I can’t believe you haven’t read that book because that’s the most important book. 

Carmen: I have read that book. I just want our viewers to know what this is. 

Jordan: Yes. 

Robert: The I is insider – I only invest from the insight. If you buy stocks, the RRSPs or whatever those things are, you’re outside and so my rich dad taught me: you’re either inside or you’re outside and one of my objectives was how do I get inside? How do I become an insider on the deal? Now, the one reason real estate is good is technically the moment I started with a little one-bedroom one-bath condo on the island of Maui, you know it’s a pretty nice island, I had the challenge: could I buy for no money? So this is back in 1973. So I put no money down, I bought this little one bedroom, one bath condo. I made 25 a month cash flow – that was called an infinite return because all I had in it was my brain power.  So, I was making $25 a month with no money, that’s called infinite. I have tremendous respect for Canadians, you know why? Because you’re a smaller country and all that, you’re resource driven and all this, but I’ve met some of the smartest brightest people there because it is harder either inside or you’re outside so if you buy an RRSP you’re outside, I want to be on the inside. I want to be putting the deal together but that takes years and years of struggle, practice, and study. But my first deal was only 18,000 on Maui and I bought it with a credit card and so every time I hear these people say cut up your credit cards, are you crazy? That’s how stupid they are. A credit card isn’t a problem, it’s the idiot holding the credit card. 

Carmen and Jordan: (Laughter)

Carmen: Oh my gosh, what an awesome perspective, I love it. It’s fresh and invigorating. 

Robert: Let me tell you, so I want everybody to listen to your program. You know what I mean? Because whether they agree or disagree with you…you could have good people and bad people on, but the most important piece of real estate…it’s six inches between your left ear and your right ear and that’s what you always want to be plowing, to be fertilizing, to be churning. You know that good ideas, bad ideas, I’m always on people because it’s between your left ear and your right ear that you’re rich or not rich. That’s all, just take control of that, control your thoughts. 

Jordan: So, you would say for those that maybe just want to get started into real estate just to educate themselves as much as possible and just get as much information as they can so that they’re empowered to start this endeavour?

Robert: I would say I’m on YouTube probably eight hours a day listening to different points of view. 

Jordan: Amazing. 

Robert: I am, yeah. I don’t necessarily disagree, I just keep an open mind, you know, I go…okay so Dave Ramsey or Suzy Orman, they say cut up your credit cards and I’m going, are you nuts? But I listen to what they have to say and I go, right. It’s if you cannot control your spending, cut up your credit cards and that’s good advice. If you just want-you don’t want to study, then an RRSP is perfect for you.  

Carmen: That’s inspiring, it’s very interesting. 

Jordan: Yes.

Carmen: Your perspective, it’s different. 

Robert: And it doesn’t mean I haven’t lost money, I’ve lost money from partners who are dishonest, I trusted them. So, start small and all that. What you’re looking for is a team. One of the problems I have with school is they tell you if you cooperate during test time, that’s called cheating. Well capitalists cheat all day long, I have the best accountants, attorneys, real estate guys, mortgage brokers, I am the most stupid guy on my team. I only hang out with smart honest people, but it takes a while to find them, you know? And so that’s what you’re searching for – is your team. You want the best accountant, the best attorney, the best real estate brokers, uh best mortgage brokers. 

Carmen: Well, thank you Robert for all your wisdom. Jeez, I wish I could, uh, hang out with you more often because you’re the smart rich honest guy and I’d love to learn more. 

Jordan: Um, very fascinating. 

Robert: That is the attitude. If people could take that away with them, like last night I had dinner with about 8 people and all we talked about was the rate on the market and reverse repo but for people who are interested in markets you’ve really got to know how the mechanisms work inside.

Carmen: It’s a whole different level of business

Robert: And so that’s why what you’re saying is the smarter you are the-its you’re opportunities go up but so does the risk goes up, which only once you have to be smarter – just want to be smarter and that’s why constant studying, take courses, you know take the options course in stocks, you know take real estate investment course, take finance courses. What most people do, a mistake they make, is that they get a real estate license. Well, a real estate license kind of handicaps you. So, I don’t have a license, which means I can do better inside deals.

Carmen: So, I know you have written many books and I think the “Rich Dad, Poor Dad” book and Cashflow Quadrant were really good and I think I would recommend that for anybody to read so maybe you can tell a little bit about the book and then we can have our viewers reach out to get some of these books, that would be awesome. 

Robert: Well again, yes, your most important asset is bringing your left ear and your right ear and the thing is this is the hard part, what they found out is if you’re raised in a poor family, you have it harder. So that’s why, I hate to say this, my poor dad, even though he had a PhD, he was a poor man. Good man, but he was poor. He always says I can’t afford it, I can’t do this. What do you think, I am made of money? And that’s where it starts, and then my rich dad always said never say I can’t afford it because that’s what poor people do. And I hear people saying I can’t afford it, I can’t do that and all that. Can’t is a four-letter word so use it carefully. Use it very very carefully because you know, I’m not religious either but as the bible says and the word became flesh and dwelt amongst us. So poor people make themselves poor with their mouths. I can’t afford that, you think I am made of money, oh the rich are crooked, the rich are evil. You know? Why does the government do something about it? You know they should just give me more money. Those are the wars of a poor person, that’s why they’re poor and the word risk, you see, the higher the risk, the smarter you gotta be. That’s all it means to me. So when I was getting ready to go to Vietnam, I started flight school in Florida and they shipped me to Camp Pendleton, California. And in Camp Pendleton, they put the guns on me. I realized, oh my god this is getting real and then I wind up in Vietnam as a carrier pilot and they start shooting at you. And all that meant let’s get smarter, get better. 

Carmen: Well thank you so much

Jordan: Thank you Robert for coming on and sharing some of your wisdom with us, it’s very refreshing. 

Carmen: And insightful.

 

Robert: And I’m very very sincere, I do more deals in Canada because you have some of the smartest people I’ve ever met there.

Carmen: Yes.

Jordan: Yeah.

Robert: There ain’t that many of them…gotta track them down.

Carmen: Yeah, track them that’s right, hang out with the smart people. 

Robert: You gotta find it, that’s the hard part. It’s like how do you marry the man or woman of your dreams? Well, you kiss a lot of frogs until you find the fairy princess or the fairy you know. I am just leaving with a closing line and it comes from Jack Nicholson, he played Colonel Jessup in a few bends starring Tom Cruise and all that and this is, you want the truth, you can’t handle the truth, and what you’re looking for is the truth but you gotta be able to handle it

Carmen: Yes, that’s right. 

Robert: So thank you so much for what you’re doing!

Carmen: Well, thank you for doing what you’re doing, this is an inspiration to me and everything you’ve said has really resonated with me and it’s put me, my thoughts, in a different place for sure. 

Jordan: For sure, yeah. 

Robert: It’s nice to speak to a mother-daughter team getting smarter, a very important role to have influencing women as well as men on getting smarter. 

Carmen: Yes, I like that.

Robert: The higher the risk, the smarter you’ve gotta get. 

Carmen: Okay.

Jordan: I love that.

Robert: So is the return. 

Carmen: Ohhh that’s awesome. Thank you so much.

Robert: Thank you guys.

Jordan: Thank you.

Carmen: Have a great day.

Jordan: If you’re interested in learning more about real estate investing, you can go to 30MinutestoWealth.com to see the rest of our episodes. 

Carmen: That’s it. Our 30 minutes are up. Go create wealth. 

S4 E15 – Investing in Canadian Agriculture

In this episode, Carmen and Jordan Campagnaro meet with Agricultural Consultant, John Cameron, to discuss the very exciting topic of investing in farmland. John has an extensive background in the farming and agriculture sector, from growing up on and running a farm, to becoming a farm financing specialist and consultant.
 
As an experienced professional in this sector, John discusses how demand for farming in Canada has increased significantly in the past years along with recent trends that can create opportunity for investors. We dig into the details about how to evaluate farmland, current incentives and financing programs available, and last but not least, the return on investment investors can expect.
 
This is a very interesting episode about a perhaps overlooked real estate investment strategy that can yield substantial benefits for landowners, investors, and communities alike!

S4 E14 – Accounting Strategies for Real Estate Success

In this episode, Carmen and Jordan meet with Jason Gibbons, Partner of RLB Professional Chartered Accounts, to discuss important tax strategies when it comes to real estate investing.

As an experienced tax professional who caters to investors, Jason talks us through various structures of real estate ownership along with corresponding tax implications. He also shares some fantastic strategies that investors can utilize to accelerate their investment growth and offset taxation where applicable. This is an extremely informative episode that will guide you to evaluate your current investment structures in order to achieve optimal success in real estate.

RLB Chartered Professional Accountants
Website: www.rlb.ca
Email: jgibbons@rlb.ca

S4 E13 – The Reality Behind Real Estate

In this episode, Carmen and Jordan Campagnaro meet with husband and wife investor team, Kaely and Alex Pal. Together, Kaely and Alex own and operate Pal Property Solutions which specializes in solving complex real estate matters for home buyers, sellers, and investors. Their core business activities consist of buying and redeveloping single or multi-family properties throughout Southern Ontario with a goal of rejuvenating neighbourhoods, providing safe, reliable housing, and encouraging home ownership.

Kaely and Alex talk us through how they got started in real estate investing and when they decided to transition their business into a full time operation. They share what criteria they look for before investing in a property, along with some of their recent case studies, success stories and setbacks. This episode sheds light on the many challenges that real estate investors can encounter and how to overcome these obstacles to ultimately become more successful, knowledgeable and empowered in business!

Pal Property Solutions
Website: www.palpropertysolutions.com