A question from Jen: With all the options available in our current economy what would be the ideal route on purchasing rental properties?
Sean: if you can afford to do it, it's a great way to create equity in the home - but it comes with a lot of risk - it's not for everybody
Ben: I recommend getting a good property manager, worrying about contracts and following up with tenants, so you don't have to worry about those things.
Are the banks being too generous?
Aeriol: I don't think we have a big problem, compared to other countries we have very low foreclosure rates, but I always advise people not to stretch themselves to the very last penny.
What happens when interest rates creep up?
Ben: If you're worried about that risk, get a 10 year, fixed rate mortgage - there are solutions there.
Ben: Canada has one of the top ranked banking systems.
Ben: I think we are being fairly conservative, but some people are getting priced out of the market, so they want to blame someone, they blame the banks.
From Umar: What is an acceptable minimum rate of return for a successful real estate investment in the short or long term?
Sean: 4-6%. Keeping in mind real estate is a long term investment.
Aeriol: 5%. But bottom line is for people to really crunch the numbers and make sure you're not in the red.
Ben: You want someone with expertise and someone who can customize your mortgage.
Sean: It's great to have someone you trust. Today, mortgage brokers have many more options, access to different lenders, etc. Mortgage brokers get the best rates etc.
A question from Nicole: What are some things we need to be aware of when signing a contract for a house? Interest rates? Fine print?
Sean: It's very important that you're reading through everything.
Aeriol: Your agent should be your consultant. They should help read through things, explain things.
Ben: It's all about affordability
Sean: People are willing to forego the monster homes to be centrally located.
Ben: People want to be able to walk to work etc. Land is in short supply.
Question from Ron on renos:
What about increasing the value of your property by renovating; should you be fixing up the kitchen, bathroom, finish the basement? What room adds the most value? What are buyers looking for in renovated properties? White kitchens? Hardwood floors?
Sean: Historically, the kitchen is a huge selling point. Bathrooms too. Wherever people spend the most of their time.
Aeriol: 20 per cent down is the goal
Sean: Purchase the property and move into it for 6 months to a year, then move out and rent it out.
Question from Martin: For the next 20 years, will I be better off buying or renting a two bedroom house?
Ben always recommends buying if you can afford.
Why is Vancouver such a hot market?
Ben: A hot foreign market and you've got a very desireable place to live.
Question from Neil: My fiancée and I are moving into a new house this summer and the house I am in now I can either sell or rent out. I have owned it for 3 years and only have about $35,000 equity. Any advice?
A question from Sonja: My husband and I are planning on buying a house in Fort Mac this year. We currently own in Beaumont, AB. Is it smarter to sell our house now and buy in Fort Mac, or rent out our house in Beaumont and buy in Fort Mac?
Fort Mac is a very hot market right now.
Aeriol: It depends on the distance, are you going to want to run back and forth for the maintenance?
Aeriol: Everyone is different, i would say it's 50-50.
Sean: There are a lot of advantages with a house, it's tax-free. People who maybe didn't have a retirement plan, but bought a home for $50,000 and the home is worth a lot more now.
Question: Are millennials in trouble? Will they ever be able to afford homeownership?
Ben: You need to get into the property ladder, e.g. start by buying a small condo. Potentially do this with a roommate to build up equity.
Aeriol: Pay off your debt first.
Sean: Save, save, save and pay down your debt.
From Sarah: My husband and I are looking to buy a mobile home in the Maple Oak Community on 17th Street in Edmonton - what are the advantages/disadvantages to this type of investment?
Sean: They are very popular and offer a great sense of community.
Sorry we couldn't get to all of your questions, but thanks for sending them in! We'll be posting the entire chat right here shortly.