How $150,000 Can Bring You $1000 of Monthly Cash Flow in Toronto – Episode #145

If you are wondering about how to build a retirement plan, how to supplement you or your spouse’s income or perhaps how to make more money, then consider this strategy.

If you have access to $150,000 through Cash, Line of Credit, Equity, or RRSP’s, then consider this…purchasing a house with a basement apartment in the upper beaches of Toronto. These are real life examples that I’m about to share with you!

— Effective Spring of 2013 —

Real Life Example:

Purchase Price: $600,000

Down Payment: $120,000 (but taking into consideration legal fees, land transfer tax and 10-15k worth of renovations to get your place into rent-ready condition) = $150,000

Mortgage Amount: $480,000

Monthly Rental Income:
$2500 (Main Unit) + $1100 (Basement) = $3600

Monthly Operating Expenses:
Property Tax $250
Insurance $100
Utilities $0 (Paid by Tenants)
Vacancy/Repairs $200
Total = $550

Monthly Mortgage Payment: Around $2050 with today’s interest rate of the low 3% range.

You total monthly Cash Flow is $1000 in your pocket!!

Now what about :

1. Appreciation (Averaged between 6-8% per year over the last 5 years)

2. Mortgage Paydown (Use your Cash Flow to pay down your mortgage faster – depending on how aggressive you are: 10 years – 15 years

3. Tax Benefits (write offs, corporate structures)

This all leads to Long Term Wealth Building.

After you pay this house off, your total net income in your pocket will be around $3000 / month (Not to mention a mortgage free house that you now own probably worth close to a million dollars in 10 to 15 years). My question to you is this: How many of these do you need in order to live the lifestyle you want? One? Two? Maybe Three?

Again, these are real life examples and I can show you many more! I hope this gives you a different perspective to investing…I am sure you have more questions so please feel free to contact me. Until then, keep smiling and have fun!