Later Takes Longer

I'm sure everyone has a few key lessons that they heard 1000's of times growing up.  Lessons that made them feel annoyed that they simply brushed off; only to realize, years later, that their old man was right!  For me, one of those key lessons was "Later Takes Longer." 

Some of the time this lesson provides an immediate feedback.  Put off shovelling your driveway until the snow is packed down.  Let the dishes pile up until everything requires a deep scrub.  Or letting a huge pile of gravel freeze solid!!  Why do today what you can put off and spend ten times as long doing tomorrow??!!!

But what if the wisdom in this lesson doesn't provide immediate feedback?  What if the lesson is only learned after it is too late?  Unfortunately, that is the financial situation for many Canadians.  Choosing not to invest today is easy and has no immediately apparent impact on your day-to-day life.  It’s only when we step back and take a 10 plus year look that we can notice the impact. 

Einstein referred to compound interest as the eighth wonder of the world.  While this is certainly true in traditional investments, it is equally true in real estate investing.  We have witnessed this ourselves first hand.  Month after month the mortgage pays down via rent payments.  At first this seems insignificant.  Slowly but surely it keeps paying down faster and faster and faster.  Until one day you look up and realize you have created more equity, in one investment, than an entire year of working at your job.  That’s the power of real estate ownership over time.

Real estate investing is not a get rich quick scheme.  But it is a get wealthy eventually plan.  The key is to get started.  Every single person I talk to that invests in real estate wishes they started sooner.  Take control of your financial future today!! You could wait and do it later, but then it’s going to take you much longer.

Why we DO NOT own illegal basement suites… and why we never will!!

Let’s imagine for a second that you decide to go out to the movies.  There is a new film out that you are excited to see!  You pay your full admission price, buy some snacks, and grab your seat.  But there’s a catch...  During this particular film, if anyone in the theater complains, the movie stops.  If anyone walking by complains, the movie stops.  If the parking outside the theater is so packed that the neighbors complain, the movie stops.  Are you still going to go to this movie?

 

This is the life of owning non-legal suites.  At any moment in time, any complaint by anyone, for whatever reason, can shut you down.  Your investment property just lost 40% of its revenue over night.  I don’t know about you, but I’m not leaving 40% of my investment to chance.

 

This is the reality for the vast majority of basement suites in Saskatoon.  It wasn’t until 2012 that purpose built new construction legal basement suites were routinely added into new homes.  Since then, we have seen an explosion of these suites in the new subdivisions.  In fact, this was one of the early catalysts to our real estate investing.  Since then, YXE Real Estate Group strives to bring these same high quality LEGAL suites into core neighborhoods. 

 

It’s easy to see why there are so many non-legal basement suites though.  It’s expensive to bring a basement suite to market following all building codes and zoning.  However, it’s worth it in our opinion.  A bright open basement suite will always rent before a dark dingy one.  Our tenants appreciate the airy living space and we sleep well at night knowing we’ve provided safe legal housing.

 

If you are an investor looking to purchase a property with a basement suite in Saskatoon, you MUST know it’s legal status.  Just because a property is new, has a side entrance, or is cleverly marketed as “suite potential” or “suite ready”, DOES NOT mean the suite will be legal.  Due diligence is an absolute must, or you may find that your movie ends just when it’s getting good!

 

Disclaimer:  This is not an endorsement that all non-legal basement suites should immediately be shut down.  Many are perfectly safe and provide necessary housing in Saskatoon.  That said, all unsafe basement suites should be shut down or upgraded.