Real Estate Investing with Sterling Homes

Edmonton’s growing economy and affordable housing have made it Alberta’s top spot for property investment.

There are all kinds of reasons to buy an investment property – perhaps you want to make a living as a full-time landlord, maybe you want to buy a second property to supplement your income, or you simply want to add an income suite to your own home to cover your mortgage payments.

Whatever your reasons for wanting to get started in real estate investing, you’ll find that things are a little different to buying a regular residential property. That’s why we’ve put together a series of guides and articles to help you navigate the process from start to finish.

Getting Started

Before you get started, it’s important to understand some of the responsibilities and commitments that come along with owning a rental property - as the owner, you’ll be responsible for the maintenance and upkeep of the building. 

15 Questions You Should Ask Yourself When It Comes to Investing in Real Estate
What is the Time Commitment to be a Real Estate Investor?
Should You Be Looking at Real Estate Investments?
6 Major Benefits of Investing in Real Estate
Guide: The Basics of Real Estate Investing
How involved you are in the day-to-day running of the property is up to you, but if you prefer to be more hands-off you might want to look into hiring a property manager. In addition, you might want to consider hiring a mortgage broker or a real estate attorney to help with the buying process.

  How to Find the Right Property Manager
People You Should Have on Your Real Estate Investing Team 

The Finances of Real Estate Investing

Now that you’ve decided to take the plunge, you’ll need to speak to a mortgage lender to begin financing your investment. One of the first things they’ll look at is your credit score, so make sure you have this as high as you can before speaking to a lender. 

  7 Things You Need to Know About Credit Scores and Real Estate Investing
What Credit Score Do You Need for an Investment Property?
What Is a Good Credit Score In Canada?
You’ll also need to come up with a down payment before you can begin the home buying process. The amount you’ll need for an investment property is a little more than you would for a home you’ll be living in yourself, so be sure to read up on this and plan accordingly. 

  How Much Down Payment Do I Need For An Investment Property?
Investment Property Down Payment Requirements
Once the down payment is taken care of, you’ll need to apply for the mortgage itself. This can also differ slightly for investors (especially if the property is worth over $500,000) so it can be helpful to familiarize yourself with the process early on. One of the benefits of an investment mortgage, however, is that you can have your tenants pay it off for you while you build equity!

  Mortgages and Investing: How Does It Work?
How To Have Someone Else Pay Your Mortgage – Buying a Home With An Income Suite
5 Ways to Build Equity in Your New Home
In addition to your mortgage and down payment, there are a couple other financial areas that differ from personal real estate when you’re investing that are worth taking a look at.

  Tax Deductions on Rental Properties
Capital Gains on Rental Investment Property

Choosing an Investment Property

Once the finances are in order, it’s time to start looking for an investment home! Certain home models can be more suitable for investors, so be sure to consider all your options. For instance, if you’re considering owning more than one property, you could look into buying multiple townhomes or both sides of a duplex so you won’t have to travel around as much if you need to do an inspection or supervise any work that needs to be done. 

  The Top Home Models For Real Estate Investors
Homes with the Best Cash Flow?
Real Estate Investment Property Spotlight: Townhomes
Real Estate Investment Property Spotlight: Duplex Homes
Real Estate Investment Property Spotlight: Front-Attached Homes
Real Estate Investment Property Spotlight: Laned Homes
While you can buy a resale home as an investment property, there are distinct advantages to buying a brand-new home instead. For instance, a new home will require far less maintenance and will be covered by a New Home Warranty. You can also be sure that an income suite in a new home will be up to code and won’t require any significant renovations to be legal. 

  Benefits of Renting New Construction Homes
Buy and Hold vs Flipping Houses: Which Investing Style is Better?
6 Reasons to Add an Income Suite In Your New Home
As well as the right home model, you’ll also need to buy a rental property in the right location. It’s important to consider the wants and needs of your potential tenants - for example, if you’re looking to attract young families who are likely to stay for a while, consider how easy it is to access schools from your location. 

  6 Reasons Investors (and Tenants!) Love New Edmonton Communities
What Makes Your Property Value Increase?
Guide: Real Estate Investing: It’s All About the Location

What Else Do I Need To Know?

When it comes to real estate investing, there are a lot of options to explore. Everybody has different needs and goals, so we’ve also put together a series of articles which cover some of the other facets of real estate investing that might not immediately come to mind.

Is Real Estate a Safe Investment?
6 Common Mistakes to Avoid in Real Estate Investing
5 Must-Have Numbers for Evaluating Real Estate Property
Tips for Buying and Owning Multiple Real Estate Investment Properties

Investment Calculator

Resources

Know Your Rights and Responsibilities As A Landlord

Looking for real estate investment properties?

Connect with one of our investment specialists and start investing today! Let us guide you through our Step-By-Step Process to Purchasing a Rental Property.

Top Home Models for Investors

Build, increase equity and achieve your property goals with these income ready home designs.

 

Download our FREE Complete Guide to Real Estate Investing

Become a successful real estate investor with Sterling Homes!

To be a successful real estate investor, you need to buy properties that are able to quickly turn a profit. Investors are often attracted by the low cost of resale properties. They know that they’ll easily be able to charge enough rent to start earning right away. What not everyone realizes, though, is that all of the problems that come with older properties can quickly eat away at those profits.

This is why more and more investors are looking at new construction properties. Sure, the cost of the home can be higher depending on the style you choose, but there are significant advantages to these homes that outweigh the initial purchase price.

Learn more about why new homes are a smart real estate investment, then talk to our Area Managers about how you can get started.

New Home Warranty

One of the biggest attractions is that all new homes are going to come with a New Home Warranty. You can buy with confidence because you’ll know that you won’t have to deal with making major repairs soon after your tenants move in. If an issue comes up that isn’t from regular wear-and-tear, it will likely be covered by the warranty. Even all the appliances will be new and have warranties!

The New Home Warranty covers different aspects of the home within certain time frames. Be sure to carefully read it over so that you understand what’s covered. You may be responsible for a certain amount of maintenance in order to keep the warranty valid. Ask any questions you may have.

Less Maintenance and Repairs

Landlords often have to deal with making a number of repairs to their properties. In resale homes, these repairs come up frequently because everything in the home is gradually breaking down. Warranties don’t always cover everything, but when you buy a new home, you can rest assured that you won’t be making all of these frequent repairs. Since everything in the home is new, it’s less likely to break down from normal use.

Ready to Learn Why New Homes Are a Smart Real Estate Investment? Kitchen Image

Stylish Features

Think about what most rental homes look like: drab walls in neutral colours; cheap carpet or linoleum flooring; and outdated light fixtures. Now think about the different look that you’ll find in a brand-new home. While you can make selections on your own to fit your budget, you can expect to have things like durable vinyl plank flooring that has the look of hardwood, attractive tile backsplashes in the kitchen, and quartz or granite countertops throughout the home. New homes will also have modern features, like an ensuite in the master bedroom or deep pots-and-pans drawers in the kitchen instead of under-counter cabinets.

These types of modern updates are attractive to renters who are tired of the same old boring look of regular rental homes. This means you’ll be able to command a higher rental price — and you’ll have people lining up to pay it!

Ready to Learn Why New Homes Are a Smart Real Estate Investment? Bedroom Image

Family-Friendly Styles

Another great thing about brand-new homes is that they’re usually quite family friendly. A lot of typical apartment rentals come in one- or two-bedroom varieties. They’re also usually in a large building with several other units. There’s rarely a backyard for the kids to play in or space to store things like bicycles and scooters.

New homes, however, have a bit more space. Many are designed with at least three bedrooms, so families feel like they have enough space for everyone. They also tend to have a private or semi-private backyard. And new homes are located in communities that are designed for families as well. They have walking trails or bike paths, large playgrounds or green spaces, and many even have a school that’s within walking distance.

As a landlord, attracting families as tenants is a great move. Families tend to want to stay in the same place for quite a while, so you won’t have to worry as much about turnover.

Ready to Learn Why New Homes Are a Smart Real Estate Investment? Basement Suite Image

Multi-Unit Options

People don’t always realize that new homes offer opportunities to have more than one unit in the building. Sometimes, investors purchase both sides of a duplex home and rent each side individually. These homes are a popular choice because they have the look and feel of a traditional home. Another great option is to purchase a typical two-storey home, then convert the basement or the space over a detached garage into an income suite.

Having more units in your property means that you can maximize your rental income. Be sure to discuss this option with an Area Manager if it’s something you might be interested in.

Great Deals on Quick Possession Homes

Often, builders will have a variety of home models and styles already built or close to being finished. They are made with the most popular features that today’s renters are looking for. Best of all, you may be able to get a discounted price as builders look to move more of their older inventory. This is great news for investors who can watch their property value increase from day one with a great deal, and they can attract renters right away with a move-in ready home.

New construction homes are rapidly becoming the style of choice for real estate investors. Now is a great time to dip your toe into the market. With the New Home Warranty and the stylish look that renters want, you will be able to start earning a profit in no time at all.

Real Estate Investment Terminology

Every industry has its share of jargon and acronyms, and real estate is certainly no exception. This can be intimidating to property investing newbies, so we’re breaking down some common real estate investment terms in a reader-friendly glossary.