SWOT not SWAT!
Hello Real Estate Investors of Hamilton Ontario!
Today’s post is inspired by my recent meeting with a writer from the Canadian Real Estate Magazine regarding an upcoming article on investing in Hamilton. At the meeting, the writer asked me many questions on investing and Hamilton and really they were no different from the questions I get from new investors and investors who are new to Hamilton. So here’s my list of FAQ’s:
- What is the best investment strategy to implement in Hamilton?
- Where is the best area for real estate investments in Hamilton?
- (there are a lot more questions but I’ll save them for future posts)
Answer: …. (wait for it…)…. It depends!
To explain my answer to the writer, I told him about SWOT
: Strengths, Weaknesses, Opportunity, and Threat. Because investing in real estate is a business and needs to be treated as such, every investor needs to review their strengths and weaknesses ideally before evaluating any opportunity.
Let me explain with an example. New clients of mine met with me after already having spent some time looking at properties on their own in central downtown Hamilton. At our meeting they showed me the listings of houses they have visited and after reviewing them, I immediately knew they were going down the wrong path. Now there’s nothing wrong with the location of central down and near the mountain brow as these properties were but they were all “cheap” and cheap for a reason.  They all needed a ton of work, capital, and/or sweat equity. So I asked them to tell me about themselves. They live and work well outside of Hamilton, have two very young children, lead very busy lives, don’t have a ton of capital or time to fix up a “handyman’s special.” But they do have strengths in the form of capital to invest and they have some experience in managing properties and tenants as they rent out the basement of their home. Plus they have me (I know it’s shameless self promotion but it’s my blog :P) with all my investing experience, training, and team of professionals I have surrounded myself with.
Once I had an understanding of their strengths and weakness, I recommended we look at opportunities that are nice homes, in nice neighbourhoods, that will attract nice tenants. More specifically, the strategy I customized for my clients was for a single family home that is move-in-ready on the west mountain. At a later date, I previewed several properties by myself (because they lead busy lives, I need to be their eyes), handpicked an “A” grade property that fit their strategy, took them out to see the house and other comparables, and we made an offer the following day on the “A” grade property I had selected.
On the other hand, I’m working with a pair of gentlemen who have a lot of experience with
Yeah, That's Perfect!
student rentals, have the resources to invest in renovations and want to but haven’t invested in Hamilton. Not yet at least. However their focus is on cash flow so I recommended to them a disaster of a single family home near Mohawk College that needed at least 20k worth of renovations. When I told them about it, they looked at me and said “Perfect!”
So you see! Two different sets of investors with completely different strengths and weaknesses hence the best investment strategy and area of Hamilton to invest in are completely different. So the answer is… it depends….
Till next time – Your Life, Your Terms
Erwin
PS – If you would like to sit down with me to design a customized investment strategy for yourself please let me know
