Everything You Know About Investing in Toronto is WRONG!.pdf

@volitionproperties
www.volitionprop.com
Everything You Know
About Investing in Toronto
is WRONG!
September 28th, 2022
Volition’s Formula to Success for Investing in Toronto

@volitionproperties
Agenda
And yes, the Meetup will be recorded and posted on our website!
www.volitionprop.com/mastermind-meetup/
6:00 - 7:00 pm In-person networking (your network is your net worth!)
7:00 - 8:00 pm Volition presentation
8:00 - 8:15 pm Break (please order food or drink to support local!) 🍺
8:15 - 9:00 pm Volition presentation continued
9:00 - 10:00 pm Networking

@volitionproperties
Housekeeping Items
● We are happy to see you in person again! 😊
● Support Local! We have a dedicated bartender and menus on tables,
and encourage ordering throughout the evening
● Washrooms: On this ﬂoor, back left before patio doors
● Cell phones: Turn them on silent and step out if you need to take a call
● Recordings: This presentation is being livestreamed and recorded on
Zoom

@volitionproperties
Legal Disclaimer
Volition Properties and its members, officers, directors, owners, employees, agents, representatives, suppliers and service providers, provides this presentation for informational purposes only.
This presentation and the information, materials, services, and other content available (“Content”) are subject to the following terms and by participating today you agree to these terms.
● The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice. Nothing containedon
within the presentation constitutes a solicitation, recommendation, endorsement, or offer by Volition Properties or any third party service provider on a property, for investment or
otherwise.
● All Content is information of a general nature and does not address the circumstances of any particular individual or entity. Nothing within the presentation constitutes professional
and/or financial advice, nor does any information within the presentation constitute a comprehensive or complete statement of the matters discussed or the law relating thereto. You
alone assume the sole responsibility of evaluating the merits and risks associated with the use of any information or other Content before making any decisions based on such
information or other Content.
● In exchange for participation at this event, you agree not to hold Volition Properties, its affiliates or any third party service provider liable for any possible claim for damages arising
from any decision you make based on information or other Content made available to you.
● There are risks associated with investing in real estate involving risk of loss. Loss of principal is possible. Some high risk investments may use leverage, which will accentuate gains &
losses. Foreign investing involves special risks, including a greater volatility and political, economic and currency risks and differences in accounting methods.
● Past investment performance is not a guarantee or predictor of future investment performance.
OUR EXCLUSIVE REMEDY FOR DISSATISFACTION WITH THE CONTENT OF THE PRESENTATION IS TO STOP YOUR PARTICIPATION. VOLITION PROPERTIES AND ALL ASSOCIATED
MEMBERS ARE NOT LIABLE FOR ANY DIRECT, INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES, UNDER ANY THEORY OF LIABILITY, INCLUDING WITHOUT
LIMITATION, DAMAGES FOR LOSS OF PROFITS, USE, DATA, OR LOSS OF OTHER INTANGIBLES. IN PARTICULAR, AND WITHOUT LIMITATION, VOLITION PROPERTIES WILL NOT BE
LIABLE FOR DAMAGES OF ANY KIND RESULTING FROM YOUR USE OF OR INABILITY TO USE THE CONTENT OF THIS PRESENTATION

@volitionproperties
Common Myths about Toronto:
"Investment Properties don't work in Toronto"
"Cashﬂow doesn't exist in Toronto"
"Investing in Toronto means that you are buying a condo"
"Toronto is too risky"
“Toronto is expensive"

@volitionproperties
Volition – The Toronto Mythbusters
Investor Focussed Realtors
Award Winning – Year after Year
Toronto Experts
Everyone at Volition is an Investor

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Frequently featured as EXPERT REALTORS on HGTV

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Volition Services
Mentorship,
Education &
Consultation
Toronto’s Leading Real Estate Investment Advisory & Realty Firm
Realty Community
Advisory Renovations
Property
Acquisition &
Sale
Design &
Renovations
Inner Circle &
Ongoing
Support

@volitionproperties
The Volition Team
Toronto’s Leading Real Estate Investment Advisory & Realty Firm
Matthew Lee
Founder &
Managing Partner
Ming Lim
Head of Realty
Florence Lee
Head of Operations and
Construction Advisory
Sam Ho
Special Advisor
Brian Li
Construction Project Mgmt
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Realty Coordinator
Chris Law
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Interior Design & Stager

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The Home Buying Process
The Volition Team!

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Exclusive Volition Inner Circle Whatsapp Group

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Volition Metrics - Downtown municipalities

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Volition Metrics - Downtown SF Detached

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Volition Metrics - Condos

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Volition Metrics - Toronto - Everywhere else

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Volition Metrics - Uptown SF Detached

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Everything You Know About
Investing in Toronto is WRONG

@volitionproperties
Meet Tommy & Gina…
Typical Nice
Family. 45yrs old,
with kids
1 Condo (used to
live in, but rent it
out now)
Primary
Residence in
North York

@volitionproperties
$300k combined
income $100k savings
$1.15M Net
Worth

@volitionproperties
“No good investment
properties in
Toronto” & “Cashﬂow
doesn’t exist in
Toronto”
Goals: Replace income.
$300k/yr cashﬂow
in 15 years
What do I do?
What’s the best
strategy?

@volitionproperties
Understand the Role of Cashﬂow

@volitionproperties
Does RE Always Go Up Over Time…?

@volitionproperties
Equity Growth Model
Equity: $300k
5% Growth
Equity: $6.5M

@volitionproperties
Equity Growth Model
Equity: $300k
2.5% Growth
Equity: $3M

@volitionproperties
Equity Growth Model
Equity: $300k
0% Growth
Equity: $1.5M

@volitionproperties
Equity Growth Model
Equity: $300k
-2.5% Decline
Equity: $700k

@volitionproperties
OMG Interest Rates Are Rising…😱
3% Interest Rates

@volitionproperties
5% Interest Rates

@volitionproperties
10% Interest Rates
Did you see the
difference?!?!

@volitionproperties
Time IN The Market vs. (that other saying)

@volitionproperties
The Reason RE is so Powerful…

@volitionproperties
The Evolution of Investors
Stage 1
“I want MAXIMUM appreciation!!”

@volitionproperties
Stage 2
“I want MAXIMUM cashﬂow!!”

@volitionproperties
Stage 3
“I want MAXIMUM risk mitigation!!
(because I now understand the ROLE of cashﬂow!!)”

@volitionproperties
Does cashﬂow really matter?
In the beginning, $500/mo really
make a difference to your life?

@volitionproperties
Cashﬂow is less in Toronto because the market
is LESS risky!
Lower Cap Rates = Lower Risk
Remember T.I.M.E.
Toronto mitigates risk!

@volitionproperties
So when do you really need cashflow?
Cashflow is important… but not to
the detriment of all else!
You need cash flow at the “end”!

@volitionproperties
What does Theoretical Physics & RE Investing
Have in Common…?

@volitionproperties
Year 4 Year 8 Year 12
THE VOLITION MULTIPLIER EFFECT
5% growth
3% rent
3% expenses
Year 0 Free & Clear
Year 18
50% LTV
Value: $1.5M
Mortgage: $1.2M
Downpayment: $300k
Rent: $7500
Expenses: $1100
Mortgage: $6400
Cashflow: $0
Value: $1.8M Value: $2.2M Value: $2.7M Value: $3.6M Value: $3.6M
Mortgage: $0M
Rent: $13,000
Expenses: $1900
Mortgage: $0
Cashflow: $11,100
x4
Value: $14.4M
Mortgage: $0M
Rent: $52,000
Expenses: $7600
Mortgage: $0
Cashflow: $44,400

@volitionproperties
Reality: Toronto supports the Volition Multiplier
Eﬀect better than other markets!!
Diverse Economy
Stable growth
Rising Rents
Best Tenant Proﬁle
Risk Mitigated (i.e. T.I.M.E.)

@volitionproperties
Myopic Cashﬂow
Chasers
Sophisticated Big
Picture Thinkers

@volitionproperties
Networking break!
See you in 15 mins!

@volitionproperties
T.I.M.E & Risk

@volitionproperties
Toronto is so
big. WHERE
do you start?

@volitionproperties
Toronto’s Hottest Investment Neighbourhoods Map

@volitionproperties
Toronto’s Hottest Investment Neighbourhoods
Exclusive Access To Investment Map
Weekly Pre-Analyzed Properties Directly To Your Inbox
www.volitionprop.com/thepropertyshow

@volitionproperties
WHAT is the Best Investment Property?

@volitionproperties
Sample Triplex:
Triplex: $1.5M
Rents: $7500
Upper: $3200
Main: $2600
Basement: $1700
Expenses: $1100
Mortgage (5%): $6400
Cashﬂow: Neutral

@volitionproperties
BONUS: How To Boost Cashﬂow By $1000 on a
$1.5M Triplex
Scenario A:
80% Mortgage: $6479
Scenario B:
15% Mortgage +
65% HELOC: $5643
Cashﬂow Boost:
$836

@volitionproperties
Good thing we invest in Toronto!

@volitionproperties
Back to Tommy & Gina…

@volitionproperties
What do I do? What’s the best strategy?
Do they sell their condo?
Do they rent their condo?
Do they buy reﬁnance their
primary?
Do they have enough money
to invest?

@volitionproperties
Start with the end in mind:
Net Worth: “Doesn’t Matter”
Cashﬂow: $300k/yr
Timeframe: 15yrs
Common Q: “I
don’t know if this
is realistic??”

@volitionproperties
Refi condo?
Value: $750k
Mortgage: $300k
Rent: $2400
Expenses (incl Mortgage): $550+$200+$1600=$2350
Cashflow: $50
If refi @ 80% LTV, new cashflow: -$850
(Equity Takeout: $300k)
Would I buy this
today?

@volitionproperties
Sell condo?
Value: $750k
Mortgage: $300k
Est Net Proceeds (after taxes/expenses): $350k
Better Option

@volitionproperties
Reﬁ Primary Residence?
Value: $1.4M
Mortgage: $800k
Reﬁ @ 80% LTV: $1.12M
Equity Takeout: $320k
Cash on hand: $100k
Total capital: $420k
Yes, you have to
Debt Service
this yourself 😢

@volitionproperties
Cost to buy triplex?
Price: $1.5M
Mortgage: $1.2M
Downpayment & Closing: $350k
Total buying capabilities:
Buying 2 now
gives them a
bigger starting
point

@volitionproperties
Yr 4 (@ 5% growth):
Value of each Triplex: $1.82M
Refi, buy 2 more:
With rising rents, assume cashflow: $0
Mortgage
Qualification is
the “?”

@volitionproperties
Yr 10 (@ 5% growth):
Value of each Triplex: $2.44M
Mortgage of each Triplex: $1.26M
Portfolio LTV: 50%
Sale proceeds of : $1.18M x 2
Mortgage Balance of other : $0 (virtually)
Rents: $10,000 x 2
Expenses: $1500 x 2
Cashﬂow: $13,500 x 2
Annual Cashﬂow: $324,000
Also consider
Cap Gains

@volitionproperties
If T&G play their cards right…
Goals:
Cashﬂow: $300,000/yr
Timeframe: 15yrs
Result:
Timeframe: 10yrs
Net Worth: $5.0M + Primary

@volitionproperties
If T&G play their cards right…
Goals:
Timeframe: 15yrs
Result:
Timeframe: 10yrs
Net Worth: $5.0M + Primary
FREE OFFER
VOLITION CAN BUILD YOU A CUSTOMIZED REAL ESTATE PLAN!

@volitionproperties
Cause & Effect of Variables:
Instead of 5% growth… 2.5% growth Iterations are 6yrs
10% growth Iterations are 2.5yrs
Instead of 3% interest… 5% interest Iterations are 4.5yrs (Cashflow & Growth is
slightly impacted)
10% interest Iterations are 5yrs (Cashflow & Growth is
slightly impacted)
Expenses/Inflation
growth
Expense growth itself is not a
big determining factor
If Inflation → Interest Rates → Cashflow &
Growth is slightly impacted
Rent growth Cashflow might not be neutral
upon refi
May choose to wait for refi until rents are
higher
Mortgage Qualification You may hit financing wall May choose to pursue JVs, etc.
Taxes You have to consider Cap
Gains upon sale
Aim for 45% LTV instead of 50%
Sell the LATER PROPERTIES first

@volitionproperties
Next IN-PERSON Mastermind Meetup:
“STREET SMART TOUR”
Date: Sat Oct 22 – 10am-2pm
Location: Downtown Toronto (West or East TBD)
RSVP: www.meetup.com/Volition
LARGEST REAL ESTATE MEETUP IN TORONTO WITH OVER 4000+ MEMBERS!

@volitionproperties
End

Everything You Know About Investing in Toronto is WRONG!.pdf

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