- Joined
- Dec 9, 2007
- Messages
- 6
My husband and I attended the Ontario Quickstart a while back, and we have a few questions on the next steps we should take (sorry, it`s a bit of a lengthy post...).
Let me give you a bit of background on our situtation. In 2002, our oldest daughter was going off to University in Saskatoon. We purchased a new 3 bedroom condo with an extra bedroom in the basement, and rented out bedrooms to other students. We used our Whole Life Insurance loan option for the down payment and paid approx. $132,000 for the new 3 bedroom condo, putting 5% down by putting our daughter`s name on the title (CMHC loan). The following year, our second daughter started University, so one less bedroom was rented out. In 2005 we sold the condo for 185,000, did a 1031 exchange to a new 2 bedroom condo ($149,500) and also purchased a second new 2 bedroom condo for $135,000 using 5% down putting our second daughter`s hame on title (CMHC loan). We rented the $149,500 condo for $1275 per month to a doctor. I`ve checked recently, and purchase prices and rent prices have gone up dramatically (I should have checked last year before he signed the second one-year lease, the rent prices had gone up by then -- lesson learned). Should be able to rent for around $1,800 - $2,000 per month now. Our daughters are in the $135,000 condo. When discussing this weekend with two realtors, the $149,500 condo now sells for $299,000 (he`s expecting $320,000 in the spring if not more), and the $135,000 condo could rent for $1,500 - $1,800 per month with a resale of $220,000 (expecting $240,000 by March). Each of these loans are around the $115,000 - $120,000 balance currrently. We do still have to have a place for our University kids (oldest daughter graduated this fall and moved away, second is in her last year, oldest son is now in University and second son is in Grade 12). However the University kids come home to work for the summer, so ideally summer would be a terrific time to move them however last time we moved them in December, which worked as well.
Here are my questions:
1. Our oldest daughter recently got married, so should we take her off the mortgage? Our lawyer had indicated (at the time of purchase) that once she is married for 6 months that her husband would have legal rights to 1/2 of her third (my husband, myself and our daughter are on title). Not sure if we should be concerned about this or not...
2. Should we sell? Prices are good, possibly going higher but no guarantee. Some of what`s driving the market is the Alberta market (oilfield related) has cooled off, and people are moving to Saskatchewan since prices are cheaper, quality of life, and less travel time to work.
3. Should we `rent to own` one or both properties, and purchase more condo`s? I placed an ad online and got 6 people who inquired about the rent to own. Most are moving into province from Alberta or Ontario, a couple are wanting to move up.
4. We have two more sons, one almost 19 and the other 17. If we purchase more condo`s, we could purchase in their names as well as ours (similar to how we did it for the girls) and qualify for 5% down. There`s also 0 down available through Genworth Financial (I`ve dealt with a mortgage broker previously who`d mentioned this). Is it possible to use the equity in one of the existing places as our down payment on new ones? Would we need to refinance, or is there some other way? Any help you can suggest is appreciated.
5. We have a fair amount of money in our RRSP`s, and are thinking about investing some of this money in real estate. We have a self-directed RRSP that is supposed to allow us to invest in real estate. Do you have any ideas how this is done?
I`d appreciate your thoughts on these options/ideas so we can try to make an informed decision.
Let me give you a bit of background on our situtation. In 2002, our oldest daughter was going off to University in Saskatoon. We purchased a new 3 bedroom condo with an extra bedroom in the basement, and rented out bedrooms to other students. We used our Whole Life Insurance loan option for the down payment and paid approx. $132,000 for the new 3 bedroom condo, putting 5% down by putting our daughter`s name on the title (CMHC loan). The following year, our second daughter started University, so one less bedroom was rented out. In 2005 we sold the condo for 185,000, did a 1031 exchange to a new 2 bedroom condo ($149,500) and also purchased a second new 2 bedroom condo for $135,000 using 5% down putting our second daughter`s hame on title (CMHC loan). We rented the $149,500 condo for $1275 per month to a doctor. I`ve checked recently, and purchase prices and rent prices have gone up dramatically (I should have checked last year before he signed the second one-year lease, the rent prices had gone up by then -- lesson learned). Should be able to rent for around $1,800 - $2,000 per month now. Our daughters are in the $135,000 condo. When discussing this weekend with two realtors, the $149,500 condo now sells for $299,000 (he`s expecting $320,000 in the spring if not more), and the $135,000 condo could rent for $1,500 - $1,800 per month with a resale of $220,000 (expecting $240,000 by March). Each of these loans are around the $115,000 - $120,000 balance currrently. We do still have to have a place for our University kids (oldest daughter graduated this fall and moved away, second is in her last year, oldest son is now in University and second son is in Grade 12). However the University kids come home to work for the summer, so ideally summer would be a terrific time to move them however last time we moved them in December, which worked as well.
Here are my questions:
1. Our oldest daughter recently got married, so should we take her off the mortgage? Our lawyer had indicated (at the time of purchase) that once she is married for 6 months that her husband would have legal rights to 1/2 of her third (my husband, myself and our daughter are on title). Not sure if we should be concerned about this or not...
2. Should we sell? Prices are good, possibly going higher but no guarantee. Some of what`s driving the market is the Alberta market (oilfield related) has cooled off, and people are moving to Saskatchewan since prices are cheaper, quality of life, and less travel time to work.
3. Should we `rent to own` one or both properties, and purchase more condo`s? I placed an ad online and got 6 people who inquired about the rent to own. Most are moving into province from Alberta or Ontario, a couple are wanting to move up.
4. We have two more sons, one almost 19 and the other 17. If we purchase more condo`s, we could purchase in their names as well as ours (similar to how we did it for the girls) and qualify for 5% down. There`s also 0 down available through Genworth Financial (I`ve dealt with a mortgage broker previously who`d mentioned this). Is it possible to use the equity in one of the existing places as our down payment on new ones? Would we need to refinance, or is there some other way? Any help you can suggest is appreciated.
5. We have a fair amount of money in our RRSP`s, and are thinking about investing some of this money in real estate. We have a self-directed RRSP that is supposed to allow us to invest in real estate. Do you have any ideas how this is done?
I`d appreciate your thoughts on these options/ideas so we can try to make an informed decision.