Good Job, Good Income, Still Can't Buy A Primary Residence In The GTA?

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Volition Real Estate Mastermind:
Good Job, Good Income, Still Can’t Buy A
Primary Residence in the GTA?
June 2022

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Who is Volition?
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real estate and to be the team who has your back.
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Investor agents make the best “normal”
agents!
● We can help you find your dream home and have it make financial sense
○ Does this property hold to long term appreciation fundamentals?
○ Does it require construction? How much are those things going to cost?
○ Can I have a secondary suite to help with cash flow? How much are rents?
What tenant profiles will I get?
○ How can my primary residence help me qualify for investment properties in
the future? HELOC? Secondary suites?
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Ming’s Market Minute

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Sales Volume

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Average Resale Home Price

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New Listings

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Sales to New Listings Ratio

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Sales to New Listings Ratio vs Avg Home Price

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Volition Market Data

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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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Rental Market Update

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Rental Market Summary: Q1 2022

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YoY Changes in Rental Prices
One
Bedroom-Avg
Lease Price
Q1 2022 (W02) $2,092.00 +13.45%
Q1 2021 (W02) $1,844.00
One
Bedroom-Avg
Lease Price
Q1 2022 (E01) $2,157.00 +12.23%
Q1 2021 (E01) $1,922.00

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YoY Changes in Condo Rental Prices- 1 Bdr

@volitionproperties
Leasing Market Update: Recent Examples
1 bdr condo (Bay & College)
DOM: 1
14 showings in 1 day
5 offers submitted
Leased for $2300 ($1800 in Jun
21)
Occupancy: July 1, 2022
Tenant Profile: young
professional couple
3 bdr/1.5 bath (Bloor & Dufferin)
DOM: 5
15 showings over 5 days
$3695 utilities extra ($3495
inclusive in Jun 21)
Occupancy: June 1, 2022
Tenant Profile: Single professional
with 2 kids
1 bdr/1 bath (Trinity-
Bellwoods)
DOM: 3
Open house: 10-12 viewings
$2,495 utilities extra
Occupancy: Jul 1, 2022
Tenant Profile: Doctor and her
partner

@volitionproperties
The Main Event:
Good Job, Good Income, Still Can’t
Buy A Primary Residence in the
GTA? We’ve solved
the Toronto
Housing Crisis
😂😂😂

@volitionproperties
Can’t Afford in GTA? You’re not alone…
Who is this for?
Define problem of “affordability”
What do “solutions” entail?

@volitionproperties
Profiles of Pained Homebuyers
Single Party
● Family
● One couple
Two Parties
● 2 friends
● A couple and a friend
Three Parties
● 3 friends
Two Couples

@volitionproperties
1 Party (Family, Couple)

@volitionproperties
Family (Problems)
Mortgage
Qualification is too
low
Can’t Afford
Monthly Carry
Costs
If: Already own a
condo/smaller house
Then: Proceeds from
sale is down payment
If: Don’t own
property yet
Then: Need 20%
down payment

@volitionproperties
Family (What Can Be Solved?)
Mortgage
low
Can’t Afford
Monthly Carry
Costs

@volitionproperties
Family (Financial Comparison)
Upgrade Option:
SF w/ Secondary Suite ($1600
rental income)
Main Option:
SF Home
BATNA:
Condo (2bdrm)
Cost $1,500,000 $1,400,000 $900,000
DP + Closing $357,000 $333,000 $211,000
Mortgage $1,200,000 $1,120,000 $720,000
Household Income Required
for Mortgage
$240,000 $224,000 $144,000
Household Income Required
for Mortgage (after factoring in
$1600 rental income)
$200,000 N/A N/A
Carry Cost (incl 10% M&R) $6,775 $6,404 $3,991
NET CARRY COST after
Rental Income
$5,175 $6,404 $3,991

@volitionproperties
Family (Features Comparison)
Upgrade Option:
SF w/ Secondary Suite
($1600 rental income)
Main Option:
SF Home
BATNA:
Condo (2bdrm)
Overview 2 storey
1200sqft + 600sqft basement
3bdrm/1.5bath
1bdrm/1bath
2 storey
1200sqft
3bdrm/1.5bath
Finished Basement
1 level
900sqft
2bdrm/2bath
Backyard Yes Yes No
Finishes Mid-grade Mid-grade Premium Condo
Location A A A
Family Friendly Yes Yes No
Growth Potential Higher (e.g. 6%) Higher (e.g. 6%) Lower (e.g. 3%)
5yr Annual ROI (Equity Growth) 28.4% ($507,000) 28.4% ($473,000) 13.6% ($143,000)
Why Do This? Rental income reduces carry costs,
but need more DP.
Entry level starter home, no
tenants, highest monthly carry
cost.
Suitable for a couple, harder for
family with kids. You own it
yourself, but lower growth
potential.

@volitionproperties
Family (What You Get, Bloor/Dufferin)

@volitionproperties
Family (Requirements)
Down payment
● Min 20% + closing costs ($350k for $1.5M property)
Mortgage Qualification
● Min Household income $200k
● If 2 people: Could be $100k per person
● No other significant debts
Carry Costs
● $5175/mo (instead of $6404/mo) vs. $3991 for condo

@volitionproperties
2 Parties (2 Friends)

@volitionproperties
2 Friends (Problems)
One Person
Mortgage
low
One Person Can’t
Afford Monthly
Carry Costs
One person doesn’t
have enough down
payment
One Person
Mortgage
low
One Person Can’t
Afford Monthly
Carry Costs
One person doesn’t
have enough down
payment

@volitionproperties
2 Friends (What Can Be Solved?)
Combine Mortgage Qualification ability
Similar Carry Costs to a Condo
Combine down payment and increase purchase power

@volitionproperties
2 Friends (Financial Comparison)
Upgrade Option:
Entry Level Triplex ($1600
rental income)
Main Option:
Entry Level Bungalow Duplex
BATNA:
1 Condo each (1bdrm)
Cost $1,500,000 $1,200,000 $600,000
DP + Closing Per Person $179,000 $142,000 $138,000
Mortgage $1,200,000 $960,000 $480,000
Income Required for Mortgage
Per Person
$120,000 $96,000 $96,000
Per Person (after factoring in
$1600 + $2100 = $3700 rental
income)*
$80,000-$100,000* $76,000 N/A
Carry Cost Per Person (incl
10% M&R)
$3,388 $2,776 $2,719
NET CARRY COST Per
Person after Rental Income
$2,638 $2,776 $2,719

@volitionproperties
Upgrade Option:
Entry Level Triplex ($1600
rental income)
Main Option:
Entry Level
Bungalow Duplex
BATNA:
Overview 2 storey
Upper: 600sqft 1bdrm/1bath ($2100)
Main: 600sqft 1bdrm/1bath ($2100)
Lower: 600sqft 1bdrm/1bath ($1600)
Bungalow
1 level
600sqft
1bdrm/1bath
Each Party Lives Above Grade? Yes No Yes
Backyard Yes Yes No
Finishes Mid-grade Entry-level condo Entry-level Condo
Location A B A
Annual ROI (Equity Growth Per
Person)
26.9% ($254,000) 28.5% ($203,000) 13.8% ($96,000)
Why Do This? Rental income reduces carry costs Each person gets a unit Suitable for 1 person, you own it
potential.

@volitionproperties
2 Friends (What you get,
Danforth/Woodbine )

@volitionproperties
2 Friends (Requirements)
Down payment EACH
● Min 20% + closing costs ($142k for $1.2M
bungalow)
Mortgage Qualification EACH
● $96k per person
Carry Costs EACH
● $2,776/mo

@volitionproperties
3 Parties (3 Friends)

@volitionproperties
3 Friends (Problems)
One Person Mortgage
Qualification is too low
One Person Can’t
Afford Monthly
Carry Costs
One person doesn’t have
enough down payment
One Person Mortgage
One Person Can’t
Afford Monthly
Carry Costs
enough down payment
One Person Mortgage
One Person Can’t
Afford Monthly
Carry Costs
enough down payment

@volitionproperties
3 Friends (What Can Be Solved?)

@volitionproperties
Upgrade Option:
Fourplex ($1600 rental
income)
Main Option:
Entry Level Triplex (Each live
in 1 unit)
BATNA:
Cost $2,100,000 $1,500,000 $600,000
Mortgage $1,680,000 $1,200,000 $480,000
Per Person
$112,000 $80,000 $96,000
rental income)*
$85,000-$100,000* ($1600 +
$2400)
$67,000* ($1600 rental
income)
N/A
10% M&R)
$3,037 $2,258 $2,719
NET CARRY COST Per
$2,504 $2,258 $2,719

@volitionproperties
Upgrade Option:
Fourplex ($1600 rental
income)
Main Option:
Entry Level Triplex
(Each live in 1 unit)
BATNA:
Overview 2.5 storey
3rd: 550sqft 1bdrm/1bath ($2100)
2nd: 700sqft 2bdrm/1bath ($2400)
2 storey
1 level
600sqft
1bdrm/1bath
Each Party Lives Above Grade? Yes (and bigger units) No Yes
Backyard Yes Yes No
Finishes Mid-grade Mid-grade Entry-level Condo
Location A A A
Person)
28.2% ($237,000) 28.4% ($169,000) 13.8% ($96,000)
Why Do This? Each person gets a unit, nicer units (no
basement), better location, similar carry
costs vs $1.5M
Each person gets a unit. Suitable for 1 person, you own it
potential.

@volitionproperties
3 Parties (What you get,
Lansdowne/Dundas)

@volitionproperties
3 Friends (Requirements)
Down payment EACH
● Min 20% + closing costs ($119k for $1.5M triplex)
● $67-80k per person* (depending on rents)
Carry Costs EACH
● $2,258/mo

@volitionproperties
2 Couples

@volitionproperties
2 Couples (Problems)
One Couple Mortgage
One Couple Can’t
Afford Monthly
Carry Costs
One Couple doesn’t
have enough down
payment
One Couple
Mortgage
low
One Couple Can’t
Afford Monthly
Carry Costs
One Couple doesn’t
have enough down
payment

@volitionproperties
2 Couples (What Can Be Solved?)

@volitionproperties
2 Couples (Financial Comparison)
Upgrade Option:
Luxury Duplex
Main Option:
Better Duplex (Each couple
lives in 1 unit)
BATNA:
1 Condo for each couple
(2bdrm)
Cost $2,100,000 $1,800,000 $900,000
Mortgage $1,680,000 $1,440,000 $720,000
Per Person
$84,000 $72,000 $72,000
rental income)*
N/A N/A N/A
10% M&R)
$2,278 $1,986 $3,991
NET CARRY COST Per
N/A N/A N/A

@volitionproperties
Upgrade Option:
Luxury Duplex
Main Option:
lives in 1 unit)
BATNA:
(2bdrm)
Cost $2,100,000 $1,800,000 $900,000
Mortgage $1,680,000 $1,440,000 $720,000
Per Person
$84,000 $72,000 $72,000
rental income)*
N/A N/A N/A
10% M&R)
$2,278 $1,986 $3,991
NET CARRY COST Per
N/A N/A N/A
BONUS OPTION: Triplex or
Fourplex with Rental Income to
Bring Carry Costs Down to
$1353-1568 Per Person (at the
sacrifice of smaller units)

@volitionproperties
Upgrade Option:
Luxury Duplex
Main Option:
lives in 1 unit)
BATNA:
(2bdrm)
Overview 3 storey
2.5 storey
1 level
900sqft
2bdrm/2bath
Each Party Lives Above Grade? Yes (and bigger, luxury living) Yes Yes
Backyard Yes Yes No
Finishes Premium Luxury Mid-grade Premium Condo
Location A+ A A
Person)
28.2% ($178,000) 28.4% ($152,000) 13.6% ($72,000)
Why Do This? Each couple gets a unit, luxury
living, premium location.
Each couple gets a unit, should be
a nicer place.
Suitable for a couple. You own it
potential.

@volitionproperties
2 Couples (What you get – Main Option,
Dundas/Dovercourt)

@volitionproperties
2 Couples (What you get – Upgrade Option,
Queen/Ossington)

@volitionproperties
2 Couples (Requirements)
Down payment EACH
● Min 20% + closing costs ($108k for $1.8M duplex)
● $72k per person
Carry Costs EACH
● $1,986/mo

@volitionproperties
Summary

@volitionproperties
Where does this work? Only in Prime
Investment Neighbourhoods?
vs.

@volitionproperties
No One-Size-Fits-All.
Lots of options.
We can design a custom solution for
you.

@volitionproperties
How Volition Can Help. As Agents. As
Advisors.
● Family – Volition Primary Residence Plus
○ We can help you find your dream home and have it make good financial
sense
○ Legal Secondary Suite? What is req’d to create basement unit?
○ Rents, Tenant Profiles, Transit, Gentrification, Econ Fundamentals, etc.
● 2 Friends, 3 Friends, 2 Couples – Volition Co-Ownership
○ Design Divorce In Advance - Your JV prenup
■ Joint Venture Structures, Agreements, Exits, Equity Splits, Different Ownership Splits
■ Different Amounts of Cash, Different Mortgage Qualification
■ Etc, etc.
○ Living Arrangement Guidelines
■ Refi, Legal ownership structure, What If scenarios, Independent Legal Council
■ R&M, Major Repairs, Renos, Reserve Fund, Bank Accounts, Decision Making Authority
■ Disagreements, Where do you make the $, Ownership splits
■ What if one person lives in the basement, Garbage Removal
■ Etc, etc.

@volitionproperties
How Volition Can Help. As Agents. As
Advisors.
● You’re a real estate investor now! Volition can help you do it properly!
○ It's more than just “buying a house that happens to have a basement suite”.
○ Ensure that it will do what you intend for it to do: basement ceiling height, side/rear
setbacks, zoning, minor variances, lot size, separate entrances
○ Investor stuff: Accounting, lawyers, taxation, corp structures, write offs, depreciation, rental income,
bookkeeping
○ Safety considerations: egress, legality, insurance.
○ Financial: taxation, tax deductibility, optimization
○ Mortgages: how to get higher more qualification (rents to help you qualify)
○ Education: areas, pros/cons, what to consider, important “investor lens” considerations such as Tenant
profiles, rents, renovations, real estate development, gentrification, transit, infrastructure improvements
○ Analysis: High level financials, Advisory, planning, and cash flow analysis
● Volition has helped investors buy hundreds of these types of properties!
Your home is the most important tool in your wealth building journey!

@volitionproperties
Reduce Monthly Carry Costs Even
Further!

@volitionproperties
Creative Financing Solutions
● Reduce Monthly Carry Costs By ~$1000 by using HELOCs ($1.5M
Property)
Scenario A:
Mortgage $5050 (80% LTV, 3%)
Carry Costs: $6775
Scenario B:
HELOC $3250 (65% LTV, 4%)
Mortgage $950 (15% LTV, 3%)
Carry Costs: $5830
Reduce Carry
Costs by $945

@volitionproperties
● Pros:
○ Lower Monthly Carry Costs
○ Extreme Flexibility
○ Pay HELOC down using additional cashflow, redraw it when required (rainy day
fund).
● Cons:
○ No principal paydown, so you don’t own more of the property over time.
○ Ever-so-slight lower overall ROI due to higher interest rate (but doesn’t make a
huge difference in the overall picture)
○ Doesn’t work for B-lenders (HELOC rates are too high)
Scenario A:
Mortgage $5050 (80% LTV, 3%)
Carry Costs: $6775
Scenario B:
HELOC $3250 (65% LTV, 4%)
Carry Costs: $5916

@volitionproperties
● Notes:
○ Do NOT pay down the mortgage principal, since it will not free up on the HELOC
due to 65% LTV limit.
○ (Hugo says: one lender will go up to 80% LTV HELOC). Don’t quote me on that.
Scenario A:
Mortgage $5050 (80% LTV, 3%)
Carry Costs: $6775
Scenario B:
HELOC $3250 (65% LTV, 4%)
Carry Costs: $5916

@volitionproperties
At The Other End of the Spectrum:
Retirees Looking For a “Pension”

@volitionproperties
Boomers…
Unhappy Boomers with Paid Off
Homes but No Income Stream
Happy Boomers Using Equity in
Their Homes To Create An Income
Stream

@volitionproperties
Use Equity In the Home…

@volitionproperties
…To Turn It Into This…

@volitionproperties
…with this much as an Income Stream
Home Value: $1.5M
Equity Takeout (up to 50%): $500k
Renovation: $500k
Rents: $3600, $2800, $2200 = $8600/mo
Expenses: $1200/mo
Mortgage: $0/mo
Cashflow: $7400/mo
Annual Cashflow: $89,000/yr
And you can still…
Pass asset down to the next generation via your estate
No Mortgage Qualification Required!
No Monthly Mortgage Payments Required!

@volitionproperties
Now what?

@volitionproperties
3 Key Takeaways or 3 Top
Things You Learned Tonight…
GO!
Raise your hand or put into
chatbox.

@volitionproperties
What is my next step #1?
Book a complimentary 30-min Advisory session
● If you are an individual:
○ …and have 1-2 friends, you are good to go. Reach out to Volition together.
● If you are a couple
○ …and you know of another couple, you are good to go. Reach out to Volition together
● If you are a family
○ …and have the down payment but need help on the mortgage qualification & carry
costs, you are good to go. Reach out to Volition.
● Come prepared with:
○ Which model: Primary Residence Plus OR Co-Ownership
○ The other people you will be doing this with
○ How much down payment funds available from each person
○ What are the salaries of each person
● Book Here: https://calendly.com/volition-matt/complimentary-advisory-session-30-mins
Do you wish to be put on the Volition Co-
Ownership placement list? Let us know!

@volitionproperties
What is my next step #2?
Attend the next Meetup!
● Topic: In-Person Real Estate Investing AMA
with the Volition Team!
● Where: Withrow Park (Danforth & Carlaw)
● Date: Jul 20, 2022
● Time: 6:00pm-9:00pm (NOTE THE TIME!)
● RSVP for free: www.meetup.com/volition
What do YOU want to learn about?? (Zoom Poll, Put
into Zoom Chatbox, or info@volitionprop.com)

@volitionproperties

@volitionproperties
THANK YOU!

Good Job, Good Income, Still Can't Buy A Primary Residence In The GTA?

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