Real Estate
What is real estate?
There are 4 types of real estate.
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What is real estate?
Real estate is the land, property, building, air rights above the ground, and underground right below the land.
There are 4 types of real estate.
1. Land
2. Industrial real estate
3. Residential Real estate
4. Commercial Real estate
Land
consists of working farms, Ranches, and vacant land. The subcategories within vacant land include undeveloped, early development or reuse, subdivision, and site assembly. [8]
Industrial Real Estate includes manufacturing buildings and property, as well as warehouses. The buildings can be used for research, production, storage, and distribution of goods. Some buildings that distribute goods are considered commercial real estate. The classification is important because the zoning, construction, and sales are handled differently. [8]
Residential Real Estate includes both new construction and resale homes. The most common category is single-family homes. There are also condominiums, co-ops, townhouses, duplexes, triple-deckers, quadplexes, high-value homes, multi-generational and vacation homes. [8]
Commercial Real Estate includes shopping centres and strip malls, medical and educational buildings, hotels, and offices. Apartment buildings are often considered commercial, even though they are used for residences. That's because they are owned to produce income. [8]
How to buy a single family?
The process of buying a single family house can sometimes be like a roller coaster ride.
To buy a house, you will need to the following:
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Make sure that you have a good (620-680) credit score.
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Your minimum deposit for the house you are looking to get, whether it's by yourself or as a co-owner/signer.
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Ensure that 36 percent of your debts are cleared.
To help you ensure that your finances are in order, you need to sit down and go through your affairs, OR you can sit down with a financial advisor that will help you improve your finances by offering advice and help you create a budget.
A Budget is a spending plan. This plan will help you determine in advance whether or not you will have enough money to do the things you need to do or would like to do. [10]
Once you've created your budget either by yourself or with a financial advisor, use it to keep your finances on track. It will help you figure out which months your finances will be tight and which ones will get you some extra cash.
Down payment required
The down payment required to buy a single-family property in Canada depends on several factors, including the purchase price of the property and the type of mortgage you qualify for.
Here's a general guideline:
1. CMHC-insured Mortgage:
If you plan to obtain a mortgage insured by the Canada Mortgage and Housing Corporation (CMHC), the down payment requirements are as follows:
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Purchase price up to $500,000: The minimum down payment is typically 5% of the purchase price.
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Purchase price between $500,000 and $999,999: The minimum down payment is typically 5% of the first $500,000, plus 10% of the portion exceeding $500,000.
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Purchase price of $1 million or more: A down payment of at least 20% is typically required.
It's important to note that CMHC-insured mortgages require the payment of mortgage insurance premiums, which are calculated based on the loan-to-value ratio and added to your mortgage payments.
2. Conventional Mortgage:
If you qualify for a conventional mortgage without CMHC insurance, the down payment requirements may be higher:
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Purchase price up to $999,999: A minimum down payment of 20% is typically required.
-
Purchase price of $1 million or more: A down payment of at least 20% is typically required.
With a conventional mortgage, you won't need to pay mortgage insurance premiums, but a higher down payment may be necessary.
It's important to consult with a mortgage professional or financial advisor to get personalized advice based on your specific circumstances. They can provide you with accurate information about down payment requirements, mortgage options, and eligibility criteria based on your financial situation and the property you intend to purchase. Additionally, mortgage rates and lending policies may vary among lenders, so shopping around and comparing offers is recommended.
What is a multiunit rental property?
A multiunit property, or multiplex, is a rental property with more than one rental unit. The important thing to remember is that the process and the rules for the purchase of a multiplex with five apartments or more is different from those for the purchase of a multiplex with four units or less.
How to buy a multi-Family?
The process of buying a multi-Family properties is almost the same as buying a single family but has more moving parts.
To buy a multi-family property, you will need to the following:
-
Make sure that you have a good (620-680) credit score,
-
Your minimum deposit for the house you are looking to get, whether it's by yourself or as a co-owner/signer,
-
Ensure that 36 percent of your debts are cleared.
Down payment required
The down payment required to buy a multi-family property in Canada depends on various factors, including the purchase price, the number of units in the property, and the type of mortgage you qualify for.
Here's a general guideline:
1. CMHC-insured Mortgage:
If you plan to obtain a mortgage insured by the Canada Mortgage and Housing Corporation (CMHC), the down payment requirements are as follows:
-
2-unit property: The minimum down payment is typically 15% of the purchase price.
-
3 to 4-unit property: The minimum down payment is typically 20% of the purchase price.
It's important to note that CMHC-insured mortgages require the payment of mortgage insurance premiums, which are calculated based on the loan-to-value ratio and added to your mortgage payments.
2. Conventional Mortgage:
If you qualify for a conventional mortgage without CMHC insurance, the down payment requirements may be higher:
-
2-unit property: A minimum down payment of 20% is typically required.
-
3 to 4-unit property: A minimum down payment of 20% is typically required.
With a conventional mortgage, you won't need to pay mortgage insurance premiums, but a higher down payment may be necessary.
It's important to consult with a mortgage professional or financial advisor to get personalized advice based on your specific circumstances. They can provide you with accurate information about down payment requirements, mortgage options, and eligibility criteria based on your financial situation and the property you intend to purchase. Additionally, mortgage rates and lending policies may vary among lenders, so shopping around and comparing offers is recommended.
HOW TO INVEST IN REAL ESTATE
Addy
AddyInvest is a real estate crowdfunding platform that provides investors with the opportunity to invest in commercial and residential real estate projects across Canada. The platform was founded in 2018 by a group of experienced real estate professionals who recognized the potential of real estate crowdfunding in Canada. AddyInvest's mission is to make real estate investing more accessible and affordable for everyone...
Equiton
Equiton is a real estate investment firm that specializes in providing high-quality, institutional-grade investment opportunities to individual investors. The firm's primary focus is on commercial and residential properties in Canada and the United States...
WealthGenius
In today's fast-paced and ever-changing financial landscape, finding reliable and trustworthy resources to navigate the world of wealth management can be challenging. However, platforms like WealthGeniusHQ are emerging to simplify the process and empower individuals to achieve financial success...
Upland
In today's fast-paced and ever-changing financial landscape, finding reliable and trustworthy resources to navigate the world of wealth management can be challenging. However, platforms like WealthGeniusHQ are emerging to simplify the process and empower individuals to achieve financial success...
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