So What the Heck is the 10X Rule and Skyrocketing Rental Demand in the GTA!

I am an avid reader, listener of audio books and podcasts and I spend a great deal of my ‘free’ time trying to continually improve myself.

You have to work on yourself.  No matter what.  Read, listen to audio books, attend a seminar.

Continual learning and continuous improvement.

Believe it or not – we do not have a TV hooked up at home.  It has been over 3 months since we have watched television.

Instead, I use some of my free time to read, watch interesting podcasts and webinars.

Our little guy doesn’t even know what TV is – usually when he sees one on he just runs away!

This has been huge for us – you wouldn’t believe what a distraction it is just to have the TV on, and we do not miss it one bit.

When we first started out almost a decade ago, we formed a holding company for our real estate.

We only had one property to start, but there was a vision to grow.

We called in Kaizen NGU – Kaizen is a Japanese word that means continual improvement and NGU stands for “Never Give Up”.

We have accumulated a large number of properties under that very umbrella by following that exact principal.

Recently I have gotten heavily into following a guy called Grant Cardone. For those of you who have never heard of him, he is the bestselling author of the “10X Rule” and a motivator, sales trainer and real estate investor.

I love his 10X principal when it comes to goal setting.  Believe it or not, we are in the final stretch of 2017!  Before we know it the holiday season will be here and we will be getting ready for a brand new year full of even bigger and more outrageous goals than this one.

The 10X Rule says that:

1) you should set targets for yourself that are 10X greater than what you believe you can achieve and

2) you should take actions that are 10X greater than what you believe are necessary to achieve your goals.

The biggest mistake most people make in life is not setting goals high enough. Taking massive action is the only way to fulfill your true potential.

I know this sounds like a pep talk, but believe me it works.

When I look back over the last 10 years of my life, goal setting has always been an integral part of my success.

I set goals – yearly, monthly, weekly and daily.  Having crystal clear goals is imperative.

These daily and weekly goals help me to plan my week and allocate my time to activities that will help me get closest to my goals.

On another note – the fall is here and everyone seems to be waiting to see what the market is going to do.

It is interesting how much of a main stream topic the real estate market has become – with everyone talking about real estate prices.

When I talk to potential real estate investors, especially those just looking to get started, I find that they are always trying to time the market.

What if prices go down more – let’s wait until………….

At the end of the day, this is speculative investment.

I like to turn the conversation around to – but do you know what the rental demand is?

Time and time again it comes down to – is it a sound investment?  Do the numbers and the economic fundamentals make sense?

If the answer is yes, and you are buying for the long haul – who cares about timing the market perfectly.

I will give you an example of a client of mine who just bought his first property in Hamilton, ON.  His purchase price was just under $400,000 and the property was pretty well turn key.

Within a few weeks, he had it rented for $1950 + utilities.

They are a great family and they have signed a 2 year lease!  How awesome is that.

I see this time and time again – a great product allows you to have a great tenant and rent flowing in within no time.

Do the numbers make sense – absolutely.

In an article by the Financial Post, it says:

“In the purpose-built rental market, the vacancy rate dropped to 0.1 per cent in newer stock, down from 0.5 per cent a quarter earlier. Average rents for available units increased by 11 per cent annually to $2.67 per square foot.”

This is great news for real estate investors with rents bringing $2000/month in many markets.

Irrespective of whether you are getting the best ‘deal’ – the power of leverage allows the return on real estate to be great.  You are only putting down 20% and making profits on the entire amount.

So don’t get caught up timing the market. There is never a ‘perfect’ time to buy and there is always opportunity in every market.

Even Beyonce and Jay-Z got on the band wagon and leveraged a whopping $88 million dollar home.

They understood that with low interest rates, they could have their cake and eat it too.  By putting down 40% and leveraging the rest, they were able to put their money into a piece of real estate without tying up all their capital!

So until next time, happy Canadian Real Estate Investing.

Jose Jafferji, REIA