Eagle Quest Properties

Wow, it is getting hotter and more humid than Orlando in Southern Ontario.  Are you enjoying your summer yet?  The summer days are getting longer and we are navigating to a new focus for our specific region.  We have driven around town to identify decent neighborhoods with good anchors.  We have found the 12+ unit apartment buildings we like.  We talk to the tenants, talk to a few owners, and pull titles on some buildings that we have identified as being buildings we were interested in.  We have talked to a senior planner in the city to get a more solid picture of their budgets and plans.  We have requested traffic counts from the engineering department for a couple of different mixed use buildings we were looking at.  There’s one area we encountered where the whole neighborhood was bad, with undesirable tenants and unkempt yards.  Many American real estate gurus advocate buying properties unseen.  We suggest reconsidering that proposition.

We are grateful for a few of our readers interested in taking assignment deals from us.  Once again, we are here to support each other in our mutual goal to achieve financial freedom.  We are analyzing more and more potential deals.  Anyone who is interested to know more about our projects, please email our acquisitions department.

The Lynes’ Lion Safari Adventure

Daniel intentionally surprises Julia by taking her to the African Lion Safari on their anniversary.  Daniel drags Julia out of bed bright and early and tells Julia not to wear red clothes???  Driving through a few little towns and some farm fields, they arrive to a gate which reads, “Do not leave your windows open, or you will be eaten alive.”  Julia screams out in fear and refuses to enter the two storey tall gate.  Daniel drives through the second gate, laughing like a hyena.  A big sign says, “close your windows and lock your doors.”  Following the small winding trails, their car comes to a sudden halt near a big tree.  Three big baboons jump right up to the windshield and one of them started urinating and defecating on the side mirror.  At a blink, you can see a few dozen of them jumping out from some tree tops.  These animals are quite vicious fighters against each other.

Here comes a shocked driver with his rooftop luggage container popped open by the curious baboons.  (Wouldn’t they make great customs inspectors?)  The best part is the thrill you get from watching ten elephants forming a bee line by clinging their trunks to tails one after the other; heading down to the lake for their leisure swim.  Well, we will let you explore the ferocious looking lions and other animals yourself.

Daniel’s New Blog

Hey, Daniel is stepping out of his comfort zone by starting a blog.  He takes an article that captivates him and share his opinion with you.  It is only an opinion; you don’t need to agree with a single word he says.

You can read his blog entries by clicking on the archives, ordered by month, on the righthand column of our Website.  If you’re looking for an article on a particular date, you can also click on the day on the calendar object in the righthand column.

If you find something interesting, there is an option on the Website to comment on the particular article.  We’ll stay current with economic developments and industry news in the region, Canada, and the U.S.A. to give you a heads up for any new changes.  We cover off topics such as new regulations affecting the industry, LEED happenings, building industry, economics, retail industry, service industry, toxic materials, and other related issues affecting real estate investment and/or property management.

Bill Bartmann has a Gift For You

We thank Jack Canfield, who emailed us about his friend, Bill Bartmann.  Bill Bartmann is most famously known for going from flat broke to becoming a billionaire!  Bill left home and joined a traveling carnival when he was 14 years old.  He became a teenage alcoholic and gang member.  His life changed when he learned to think better of himself and realized his true potential.  He learned how to take his dreams and turn them into reality.  Ultimately, Bill received his GED and eventually graduated from law school.  He went on to build seven successful businesses in seven different industries.

Let’s listen to a billionaire’s “9 Steps to Achieve any Goal.”

The One Little Golden Goose

Julia feels fortunate to have started using credit cards at very early stages of her working career.  At the time, a co-worker graciously introduced her to use dividend credit cards; Julia ended up getting paid dividends annually.  The best side effect was she had built up her credit score, unknowingly.  When you have a good credit score, the credit card companies will mail out extremely low interest rate offers to you.  Would you like to make use of credit cards like a small golden goose?  Some benefits are huge: build up credit line, increase credit score, get paid up to 1% cash back, accumulate air miles to fly free, and get free groceries if you use the President’s Choice credit card.  Needless to say, some investors use it to finance fix & flip single family homes.  Just one small way to build wealth.

A Business Plan is The Start

We are finally writing up our business plan.  Our procrastination!  The real value of creating a business plan lies in the process of researching and thinking about your business in a systematic way.  The act of planning helps you to think through your ideas thoroughly to avoid costly, perhaps disastrous mistakes later.  The most time consuming is in the research part.  The two great helpful sites we have found for drafting a business plan are: Industry Canada and the US Small Business Administration.

The Power of Leverage – Your House

Assets are something that put money into your pocket vs Liabilities which are something that take money out of your pocket.  Is your house an asset or liability?  The answer is No and Yes.  Most of us were brought up to believe that our house is an asset.  Actually, it’s the equity in the house that is the asset portion.  The equity belongs to you.  If you carry a mortgage on your house, the property is technically the bank’s asset.  Yes, your house doesn’t become a true asset until you sell your house and realize the capital gains (convert the equity into cash).  If you understand that, the next question is why not leverage the value of the equity in your house and put it into higher yielding investments?

Most banks currently loan up to 75% of the equity (HELOC) in your house at a rate of around 4%.  Some stock savvy investors then put this money into high yielding funds in the stock market.  Some novice real estate investors would prefer to buy an apartment building to create passive income.  eg. If you own a mortgage free house worth $650,000 in Vancouver, you can use a $400,000 HELOC to buy a decent 8 unit apartment building in Southern Ontario.  If you can rent each unit for $700, based on a 45% expense ratio, you realize a net rental income of $385 x 8=$3,080/month.  After paying a HELOC interest only payment of $1,333/month, you are putting a net passive income of $1,747 into your pocket every month.  Would you see how this would benefit you by turning your house into a money making machine?

“Life is not easy for any of us.  But what of that?  We must have perseverance and, above all, confidence in ourselves.  We must believe that we are gifted for something, and that this something, at whatever cost, must be attained.”

- Madame Marie Curie

Daniel Lynes and Julia Lee

We are in a recession.  Maybe it will become a greater recession.  We don’t know.  But it is a time of credit contraction instead of credit expansion.  A $5 shirt?  A $10 pair of shorts?  That is a sign of deflation.  A few months ago, these same clothes may have had designer brands on them – Diesel or Polo Ralph Lauren, perhaps.  Excess capacity was created by excess credit.  That is what happens in an expansion.  Manufacturers borrow to increase capacity, so they can sell more products to credit-addled consumers.  Then the excess capacity dooms them.  They put out too many goods and too many services.  When demand falls along with incomes and housing, prices fall too.  A couple of our readers share that their line of credit (LOC) has been revoked by their bank, because they have not used it for many years.  If you are relying on your LOC as a contingency fund, be aware and be prepared.  Ideally, the purpose of a LOC is to buy income producing properties that create positive passive income every month.

Recap to Apartment Investing

Further to the last issue, we are so passionate about apartment investing that we can’t help to share a few more jewels with you.

PHYSICAL ANALYSIS: In-suite conditions must be livable, clean and functional with a good efficient layout. Common areas, roof, mechanicals; security is key as everyone wants to be safe while they are sleeping.

FINANCIAL ANALYSIS: Check lease provisions. Ensure terms are properly enforced with background checks. Historical data should have three years of operating history; a major upturn just before being placed on the market should be a concern. Almost everyone lies about their utility costs, so ask for the utility bills.

TIMING VS LOCATION: If you buy the property right in the wrong location, you can still get hurt.  The physical location will help us read the demographics.

TIMING VS VALUE: If you buy cheap enough, if the market tanks I will still be okay?  Not really true.  If the market takes a dive, you could have a serious challenge getting your project to fill.

The key is that if you are cashflowing in a property you don’t have to sell even if the market is down.  Therefore, you have to buy right, at the right time, in the right location with the RIGHT TERMS.

The Passing of a Legend

With the passing of Michael Jackson, the undisputed King of Pop Music, we are reminded of our extreme mortality. Tomorrow is only a hope; today is a gift, called the present. Why don’t we live life to the fullest with a purpose? Michael was truly living his purpose even when he was only 5 years old.  Sadly, he passed away at 50 from a heart attack on June 25, 2009 in Los Angeles.  Our prayers are with his family in this sad time, for them.

Let Us Help You Help Us

We have been actively looking for 20+ unit apartment buildings in Southern Ontario.  If you have come across apartment owners who want to sell and you are not in the market to buy, please call us at 1-877-978-9788 or e-mail Daniel.  We will reward you according to the size of the deal, that we close.

If you want to share any of your insights, market knowledge and your resources, we would always appreciate it.

Master Your Invisible Power

We feel fortunate to have attended the world-famous seminar “The Millionaire Mind Intensive” by T. Harv Eker’s team.  To master the inner game of wealth, you should read Harv’s book: Secrets of the Millionaire Mind.

Each of us has a personal money and success blueprint already engrained in our subconscious mind.  It is this blueprint that is running our financial life. Yet, we might not know how to reset it for success.  Our comfort zone is in direct proportion to our income zone.  We should have an active income as well as a passive stream of income: real estate, storage, Internet marketing, etc.  Millionaires are good money managers.  Yes, we are excited to start using an excellent and easy money management system.  You can too!

There was one exercise that made some people in the audience and Julia cry.  In the end, Julia was taught to let go of her pain from childhood experiences owing to her mother’s extreme dominating and abusive behaviors.  People who have to be right are usually the most miserable.  Research shows that 47% of all cancer is related to unresolved anger.  The seminar trainer, Doug Nelson, says it best:  “everyone does their best they can at times.  We don’t necessarily forget, but we do necessarily forgive”.

If you are ready to experience a life-changing journey yourself, please call or e-mail us as we have received some free tickets from the event.

Managing Your Credit Score

A credit score is a number that lenders use to help them decide “if I give this person a loan or credit card, how likely is it that I’ll be paid back on time?”  It essentially dictates your finances.  Most of us don’t know this number until we apply for a loan.  Julia has met a lady, who got declined for a mortgage because she had been paying everything in cash and had not established a credit history in her life.

FIND OUT WHERE YOU STAND: Request a copy of your report from the three major credit reporting agencies (CRAs):  Equifax, TransUnion, Experian.

FIGURE OUT THE FACTS: One late payment on your Visa can stay on your report for up to seven years.  If you find any discrepancies, you need to fill out a dispute form and send it back to the CRA by registered mail.  Fortunately, the law states any item not being verified as accurate must be removed from your report.

CLEAN UP: Set up a plan to eliminate existing debts.  Clearing up debt can take time. Remember that you have the right to add remarks to your file. Take the opportunity to defend yourself and point out the good areas of your report, such as highlighting a loan or a mortgage that was paid on schedule.

PROVE RELIABILITY: Taking out a loan that you don’t need and then paying it back in a short span of time can prove that you are a good credit risk.

TOO FEW OR TOO MANY: The ideal position is to have a few lines of credit, never more than you could afford to pay off on your income, and with none of them maxed out.  Cancel old cards that you never use.  Don’t ever max out one giant line of credit by putting your entire debt on it.  This is akin to killing the goose that laid the golden egg.

“Holding on to anger and resentment is like drinking poison and expecting someone else to die.”

- Unknown

Daniel Lynes and Julia Lee Lynes

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