The York Region is an area in Ontario where real estate investors can make a lot of money. As prices spiral higher and higher inside Toronto proper, that growth is also causing waves in the larger region as people look for places to live, balancing what they can afford with where they want to live – and the type of house they want.
York has four neighborhoods that are particularly solid targets for real estate investors right now, either for those looking to build a new income stream or for those looking for a primary residence that will turn into a major part of their nest egg – or their legacy. The first is the North Richvale neighborhood in Richmond Hill. This area features a lot of smaller bungalows on larger lots, so a lot of builders are buying them up, knocking down the old houses, and putting up larger dwellings. North Richvale is close to some other hot areas – Bayview Hill and South Richvale – which explains the fact that prices in the neighborhood have doubled in the last five years. Andrew Mackenzie High School is another draw for families looking for quality education for their children.
The Cornell neighborhood in Markham is an enclave of lower home prices in the midst of a hot area. Cornell lacks some of the amenities that are available in some other parts of the York Region, which is one reason for the lower prices, but if you don’t need those amenities but are looking for convenience, then this might be the neighborhood for you – especially given how much more affordable homes are here than they are in other parts of Markham.
Another Richmond Hill neighborhood that is growing in popularity is the Crosby area. Home prices have gone up by about 115 per cent since 2012, and much of the increase has come as a result of buyers coming in as investors and renting out the homes for the short terms, intending to use the profits to fund either additions or knocking down the existing home and building a larger home on the oversized lots.
The Cachet neighborhood in Markham is not really a price value, but it is an exclusive area with lots that are often a half-acre in size, or even larger. The contouring of the land on many of the lots has led to increased privacy. If you want to stay close to Toronto and have the means to enter the upscale market, then this is a neighborhood to consider.
So what does this mean for HOS Financial investors?
The York Region is seeing intense price growth, and in a situation like that, a lot of would-be buyers will experience difficulty in gaining loan approval despite having the means to afford the payments on a home, and so a “rent to own” Progran could help eliminate the rent cycle and put consumers into homes today utilizing Rent to Own. A lot of people think that “rent to own” means looking down a small set of listings on the back of the classifieds and having to settle for much less in terms of quality. However, in the aftermath of the 2008 housing collapse, more and more people are hearing “no” from traditional lending sources. Bank lending guidelines have become much more conservative, particularly in the areas of credit score and income verification. That means that a lot of people who would have qualified for loans before – and have the means to purchase homes in upscale parts of Canada, including the York Region – need alternate forms of financing. If they don’t have the large down payments that private lenders ask for, then they often end up looking for lease purchase agreements.
Even if you don’t have the money to purchase an investment property and put it on a lease purchase agreement for two or three years, you can still pool with your funds with the money from other investors and buy a property through the HOS Financial system.
Here’s how it works. You invest, either as a sole owner or as part of a group, in a property. In many cases, a borrower/tenant has approached us with interest in a particular house, and then you invest in that house. The borrower/tenant then puts down a deposit – typically a minimum of five grand. This will eventually go toward the down payment at the end of the agreement, but for now it goes into a savings account.
Then the borrower/tenant starts paying rent each month. The rent is set at or near the top of the local market, and then on top of that the payment includes a monthly contribution toward that eventual down payment. You benefit from the interest on that money – and in the unlikely event that the borrower/tenant cannot qualify for bank financing when the lease term ends, you get to keep all the money – the deposit, the rent and the extra payments for down payment credits.
But in most cases, the borrower/tenant fixes his or her credit or income history issues over the course of the lease purchase agreement. HOS Financial screens potential borrower/tenants just as carefully as the banks do, and we have developed a reliable system for identifying people who are (and are not)likely to succeed in this system. So at the end of the lease purchase, you walk away with the principal you invested – plus three years of rent payments. You can either invest in another property or pursue other
Interested in what HOS Financial has to offer? Give one of our rent to own specialists covering the York Region a call today. We have helped many investors turn a profit that rivals gains from mutual funds and stock investments without the risk that the markets represent. We look forward to talking to you and helping you decide whether HOS Financial is the right investment choice for you.