Day: February 4, 2009

Who wins?

 

RRSP’s come out of your pocket and into an account that are expected to increase dramatically in value over time and in the end cover you in your golden years – is that about right? Portfolio mix and management will all come in to play here as well.

 

Real Estate investments make money in THREE ways. 1) Increase in Value over time, 2) Decrease in Principle over time (and inherent increase in Equity, and 3) Positive Cash Flows from rental income in excess of total operating costs.

 

Since there are so many variables to look at, let’s take a simple approach and look at straight VALUE increase over time.

 

Lets look at real results.

 

Heck, lets make it interesting and look at MY results!

 

Here is a recent statement of my RRSP performance:

 

 

Yes, that says NEGATIVE 27.02 percent!      Look familiar?

 

Look at the Annualized Return since Jan 16th 2004! NEGATIVE 5.54%

 

 

Here is a recent tax statement of the objective increase in value of one of my properties:

 

( the tax assessment was actually a large document, so Im only showing the relevant section).

 

Look familiar? If you own Real Estate I bet it does.

 

See the difference?

 

Now take into account the rental income resulting in positive cash flows, the decrease in principle over time (about 5% value per year), and not to mention the actual improvements to the property which have increased its value dramatically.

 

One takes my money, and doesn’t really perform too well ( my numbers are pretty average for this current economy), and the other is much more stable, passive and GENERATES cash (again – average for even this economy).

 

Hmmm….

Hi Everyone,

 

So you have been coming to read my blog for a little while now, and I am hoping that you have all learned something, if only something about me. Just a few hours ago I was setting up my new business cards, and I entered my BLOG url on there and just that alone generated a response! Not only are many people not taking care of their potential blog business, but those that have been are not necessarily promoting their blog enough!

 

Attaching your blog url to your business card is a great way to get people to check you out. When you hand out a business card at a meeting, interview, run-in on the street or to a new business contact, if the blog url is there, you have instantly provided them access to a more personal, in-depth look at who you are and what you are about. This can be very beneficial when a cover letter, elevator pitch, or pass-by are not enough to get the true message across.

 

Even before I had any good reason to have a business card, I had a personal one made that had my name, cell, interests (real estate development at the time) and my email. Now whenever I would have an interesting conversation with someone about Real Estate, I could pull out my card and give them an easy way to remember me. If only I knew about blogging then!

 

Dont wait – get yourself out there!

 

What do you take a special interest in? Hockey? Shopping? Carpentry? Reading romance novels 🙂 ?

 Start Blogging!

 

Hi Everyone.

 

As you may know, my fiancé just bought a courthome in Kanata – a beautiful 3 bedroom home with a basement and full backyard. We will be living about 10-12 minutes from downtown, and 5 minutes from major shopping centres, surrounded by tons of green space and a great sense of community. The only downside to this is that we are going to have to make an adjustment – we are used to the East side of town! About 4 years ago we purchased a 2 bedroom condo off of Jeanne D’Arc Blvd and lived there for about 2 ½ years and LOVED IT. We were walking distance to the mall, had a park in front AND in back of us, transit outside of our door, and even Tony’s Pizza right beside us that would make the best pizzas, burgers and subs in town. All of her friends are on the East side, and most of her family as well – not to mention mine too!

 

So what are we getting ourselves into? Well lets have a look at the two towns and see how we fair.

 

Orleans is a suburban area about 16km from downtown Ottawa with 95,491 people as of 2006 (11.5% increase over 5 years). Orleans has Place D’Orleans as its major shopping centre and even has Petrie Island for those hot summer days to go hit the beach. There are not really any social hot spots in Orleans – perhaps maybe a lonely pub or two. Orleans has however seen a massive increase in residential development in the past year or two, and the Queenswood Heights area now boasts a Wal-Mart, Superstore, Sobeys, Future Shop and new Canadian Tire to complement its existing Home Depot and Staples. Furthermore, many eateries have popped up including Boston Pizza, Montana’s and (drum roll…..) WENDYS. Who can forget the Shawarma Chef tucked away behind the MacDonald’s on Innes and Trim? So business appears to be booming in Orleans – what about Kanata?

 

Kanata is also a suburban area that is about 22 km from downtown Ottawa with 85,112 people as of 2006, which represented a 20% increase over 5 years! Kanata is home to the high-tech sector and a variety of big name enterprises. Kanata was designed as a mix of commercial and residential properties which contain a great amount of green space and is surrounded by the greenbelt. A major difference with Kanata is that it is comprised of many smaller sub-communities that each contains their own commercial centres and unique cultures. My new neighbourhood, Beaverbrook, is located right beside the greenbelt and is minutes from the Kanata Centrum power centre, Ottawa’s third largest shopping centre, and the AMC Kanata 24 Theatre complex. We are home to Canadian billionaire Terry Mathews and (one of my favourites) about 10 minutes away from getting out of my house and into the ScotiaBank Place! Kanata boasts a plethora of Elementary, Catholic, French Catholic and French Immersion Schools (over 20!). I know , I know, that only matters to people that HAVE children, but I AM getting married in 4 months – and kids could (hopefully) soon follow!

 

All in all, I would say Kanata is very much like Orleans. They are both suburban areas at approximately the same distance to downtown Ottawa, and they each have both have seemingly booming economies. What excites me about Kanata is the variety of local stores and outlets, and the amount of green space surrounding my neighbourhood. Also, I I am just out of earshot of the highway, so I can hop right on in under a minute! Best part you ask? NEW TOWN! There is nothing wrong with Orleans AT ALL… I love it dearly, but I am an adventurer, and the thought of new faces, new streets, new activities and new challenges excites me.

 

How do you guys feel about East VS West ends?