BOOM Issue 16 by Boom Magazine

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Investing in South of the Border This article will teach you three basic options for financing when you’re considering investing in real estate in the US. You can use the equity in your home in Canada to do three things: 1. purchase a US property outright 2. put a down payment on the US property and finance the balance with US financing 3. put a down payment on the US property and getting a vender take back (VTB).

Buying US Property: 8 Financial Planning Tips

Susan Mallin, an experienced Financial Planner shares her insights on purchasing properties in the US from a financial planning perspective. Read on to learn about what to watch out for when you are looking into investing south of the border as a Canadian buyer.

Looking Ahead to Retirement Through Real Estate

To many Canadians, their home or primary residence is their biggest financial asset and are relying on their home equity to financially support them after retirement. In this article, the author compares two property types: single-family dwelling (“SFD”) and multi-unit residential property (“MURP”) and discusses the advantages and challenges of each.

How to Analyze a Real Estate Deal How do you know if a property is worth purchasing? For Julie, she can figure out this question in about 60 seconds after she steps into a property. Of course, a lot of it has to do with experience, but there are some rules and questions to consider in order become an expert at this!

Tenant Profile Critical to Success For those of you who already own rental properties, you know the importance of the quality of a tenant. This article will show you why tenant profile is critical to your success as a property investor. Read on to discover how you can identify a good tenant vs a bad tenant and what items should be included in your checklist when it comes to looking for one.

about BOOM Magazine BOOM Magazine is all about property investment. When this magazine was conceived, the market lacked some real content relating directly to property investment. It seemed like just about every realtor could contribute an article about selling your home, and it would be in blogs and magazines all over the place. BOOM Magazine was created for the property investor, by the property investor. Each month, you will see contributions from professionals in the market as they share their experience in the field. Within BOOM Magazine, you can expect the very best of our market - whether it relates to property investment, financing and leveraging or the different asset types, BOOM Magazine will be sure to have it as an editorial. Would you like to contribute to BOOM Magazine? Email editor@bestofourmarket.com and weâ&#x20AC;&#x2122;ll talk. Would you like to influence the direction of the magazine? Register to subscribe and vote on the polls on what type of articles you would like to see more of.

contributors Sylvia Sigurdson For over 14 years, Sylvia has been assisting people with their mortgage needs, originally as a licensed realtor and now as an Accredited Mortgage Professional (AMP) at Mortgage Depot in Victoria, BC since 2004. She has specialized in helping her clients acquire investment real estate as part of a wealth-building strategy and excels at structuring mortgages with the greatest tax advantage in mind. www.mortgagecanada.com

Julie Broad Julie Broad has been investing in residential real estate for over a decade across Canada. Sheâ&#x20AC;&#x2122;s a featured keynote speaker and an award winning real estate blogger with a passion for helping others transform their financial future with real estate investing. Connect with her at: www.revnyou.com

Paul Kondakos Paul Kondakos, BA, LL.B, MBA, has over a dozen years of experience in locating, financing and managing multi-unit residential apartment buildings within Canada. www.realtyhub.ca

Susan Mallin Susan Mallin, CIM, CFP is in charge of the Financial Planning Division of Goodreid Investment Counsel. Her clientsâ&#x20AC;&#x2122; needs typically range from basic retirement planning, to the more complex cross border planning strategies. She is based out of Toronto, but works with clients in all parts of Canada. She looks at her role in financial planning as the centre of the financial puzzle to help find the missing pieces needed to make the plan complete. Often this means connecting and coordinating with other professionals such as lawyers, or accountants to help fulfill the entire needs of the client. Contact information 1-888-466-3734 smallin@goodreid.com

Investing in

South of the Border This article will teach you three basic options for financing when youâ&#x20AC;&#x2122;re considering investing in real estate in the US. You can use the equity in your home in Canada to do three things: 1. purchase a US property outright 2. put a down payment on the US property and finance the balance with US financing 3. put a down payment on the US property and getting a vender take back (VTB).

Investing in South of the Border By: Sylvia Sigurdson Although the US has started its slow recovery from the credit crisis in 2008, there are still many real estate deals to be had. If you’re considering purchasing south of the border, getting your financing arranged before finding your ideal property will put you in a much better negotiating position, as it does here in Canada. Before making any major investment, a lot of research needs to be done. Here are three basic options for financing in order to get you started: 1) Using the equity in your home in Canada to purchase the US property outright, 2) Using the equity in your home for the down payment, and financing the balance with US financing, and 3) Using the equity in your home for the down payment and getting a vendor take back (VTB) 1) Using the Equity in Your Home Besides having enough liquid assets or investments to purchase a property in the US, using the equity in your home in Canada is by far the next easiest route. The most basic lending rules allow you to borrow up to 80% of your home’s current marketable value. For example, if your home is worth $500,000, then you can take your mortgage up to $400,000. If you already owe $200,000 on your current mortgage, that leaves you with $200,000 for all costs associated with purchasing, including the property itself, but also legal costs, financing charges, renovations and possibly a trip or two to get to know the area and view the property. Many lenders allow for multi-level mortgages, so you can separate your current mortgage with your investment property’s mortgage, but still have them under one umbrella. This keeps things simpler at tax time, depending on what type of property it is. In some cases, the lender will want to know what

you need the money for, but in many, you can attach a secured line of credit against your home for future borrowing/investing and then use it when you actually find the perfect property, whether it’s in Canada or the States (or in any country, for that matter). 2) Equity for Down Payment/US Lender Financing for Balance After the credit crisis, this option was almost nonexistent, but US lenders are slowing getting back on board with financing Canadian purchasers. This is great news for a US investment and has also helped buoy the economy for Americans and Canadians alike. The down payment still needs to come from your own resources, so if you don’t have enough liquid assets, following the previous steps will be the same. Using the same example, the $200,000 you have access to would represent the closing costs and the down payment only, giving you much greater buying power. You will still most likely need to come up with 35% down, so in this case, instead of purchasing a property for only $200,000, you would be able to purchase for approximately $570,000 (assuming you have the closing costs saved, and you qualify for the mortgage). Example: $570,000 purchase price $200,000 down payment (35%) $360,000 US lender financing (65%) 3) Equity for Down Payment/VTB Like the above two examples, the down payment is still coming from the equity in your home in Canada, and the balance is carried by the seller, or vendor. Many US property owners have seen how difficult it has been for purchasers to obtain financing and they may be willing to carry some of the

financing as they know it may be the only way they can sell their property. They may even be willing to carry more than 65%, but a 35% down payment is still a good starting point. In this scenario, the vendor acts as the bank, and the interest rate, term and amortization are all negotiated as part of the contract. Each individual seller is motivated by different things and it will be up to you to determine what those are. There’s a lot of room for creativity here, as long as you still follow the individual state laws. Once you have your financing lined up, check with your realtor to make sure everything is in order before removing your ‘subject to financing’ condition, as the processes are very different from what you’re used to in Canada and you don’t want to get caught with an unconditional sale and no financing lined up. Something else to keep in mind is to contact a company like MTFX (Money Transfer Foreign eXchange) for getting your Canadian funds to the US in order to complete the sale. They will be able to guide you through the process, get the best exchange rates and ensure your funds arrive on time. Because you’re dealing with large sums of money the exchange rate savings can be significant.

B 8 Fina

Buying US Property: ancial Planning Tips

Buying US Property: 8 Financial Planning Tips By: Susan Mallin The combination of bargain house prices and a relatively strong Canadian dollar makes the lure of purchasing vacation or investment property in the U.S. very appealing. However, from a financial planning point of view, there are some issues residents of Canada should be aware of before signing on the dotted line to buy U.S. property. Arming yourself with this knowledge will prevent potentially costly mistakes that could be painful down the road. 1) Borrowing to buy – if possible, it is better to arrange a “non-recourse” mortgage. These are more popular in the U.S. and not typically available in Canada. Non-recourse means that only the specific property is collateral for the loan and any other assets are off limits. This type of mortgage is beneficial for those with significant assets that could be exposed to estate taxes. 2) Taxes on U.S. property – when owning U.S. situated assets, you may be exposed to US taxes. The most common are taxes on rental income, capital gains taxes on the sale, and gifting of residential property above certain limits. 3) Estate Taxes – could produce headaches for your family if your assets are not structured properly before death. Canadian residents with U.S. situated assets exceeding a fair market value of $60,000 triggers the need to file an estate tax return in the U.S. However, unless your total worldwide gross estate is valued at greater than $5.25 million, there should not be any net taxes owing. 4) Wills and Estate Planning – a Canadian Will drawn up based on Canadian law, is acceptable in the U.S. However one will need to get the Will probated

in the U.S. as well as in Canada upon death. It is important to ensure that your Will specifically addresses U.S. property. 5) U.S. and Canada Tax Treaty – the treaty was designed to avoid “double dipping” in tax dollars for the same property. It doesn’t mean one can choose to pay the specified taxes in the Country of choice. If selling U.S. property, the IRS will require capital gains taxes (if applicable), and Canada will also require reporting of capital gains. There may be a further balance owing on any difference between what you paid to the U.S. compared to what you would have paid if it were a Canadian situated property. 6) International Tax Identification Number (ITIN) – these identification numbers are needed if any tax forms are to be filed in the U.S. They will be needed if gifting or selling your U.S. property. The ITIN is very easy to get, but it can take 6 weeks or longer. It will save time for your executor and is needed to claim any withholding taxes either from rental income, or the sale of the home. 7) 120 day Snowbird Rule – the last thing anyone wants is to be “deemed a US resident” for tax purposes. Once a person is on U.S. soil for 31 days in any one year (does not have to be consecutive), it triggers the need to calculate a substantial presence test. It’s a formula that encompasses fractions of the latest 3 year period, and calculates a number of days with a trigger point being 183 days. If the number of days in the calculation is 183 or greater, you may be considered a U.S. resident and made to file US personal income taxes on worldwide income. Seasoned snowbirds know that as long as one does not exceed 120 days per year, the

calculation will never exceed 183 days. 8) Having too much house and not enough cash – is one of the most common financial planning problems retirees face today. If you are pre-retirement, and thinking of buying a vacation property, it’s best not to forfeit savings ear-marked for other purposes. The last things we need at retirement are worries about money. A financial plan can give a very good indication if fixed assets will need to be sold during of retirement or not. If selling isn’t the intention, planning for alternative solutions now is prudent. As the saying goes, “forewarned is forearmed”. Susan Mallin, CIM, CFP is the Financial Planner at Goodreid Investment Counsel. For more info please visit www.susanmallin.com.

Overcome Fear in Real Es

state Investing When it comes to first time real estate investing, there are many factors that need to be taken into consideration, which can be intimidating for new investors. In this article, Julie will teach you how to overcome fear and become more comfortable about real estate and investing in it.

Overcome Fear in Real Estate Investing By Julie Broad I’ve been in real estate for over 11 years and done dozens and dozens of deals, but time and experience doesn’t completely get rid of my fears. I’m sure I will always worry a little bit that something could go wrong with a deal. But those fears serve an important purpose in my life – they always make me stop and double check what I am saying and doing in my business. The key is that it doesn’t freeze me in place – it just serves as a good double check. Fear in real estate investing is common. It can be scary at times. There’s a big fear of losing money. There’s concern over the stress that you can feel if something goes wrong with a tenant or a partner or a deal. Running from what scares you, doesn’t work though. Doing nothing doesn’t change anything either. I think the best thing you can do is acknowledge that you’re afraid of something, understand it, and then decide if you need to run from it or confront it. When you do it this way you’ll be able to recognize the fear that is protecting you and move past the fear that is holding you back for no reason.

Rarely are these actually the obstacles holding you back. More likely, it’s something deeper like a fear of making a mistake that leads to you being judged poorly by someone you love. In other words, you’re likely not just afraid you will do a bad deal and lose money. You have to look at why you’re afraid of losing money. What is it that you are really afraid of? Until you get into it and actually uncover that real fear, it’s hard to move past it. But once you realize that you are afraid your husband or wife will think less of you if you do a deal that doesn’t make money, you have something you can tangibly deal with. Again, I am not a big believer that you’re going to get rid of the fear so the better plan is to acknowledge it’s there, figure out what is driving it, and then do what you need to do to feel more comfortable with its presence.

I’ve met hundreds of investors that are stuck – they want to do deals but aren’t. Sometimes they have been stuck for years and years! When I ask what’s holding them back, the answer is almost always because they can’t find good deals in their area or they don’t think their market is a good one to invest in, but they don’t know where else to invest. Sometimes they don’t have investment capital and feel stuck without money to put into the deals.

Let’s just say your biggest fear is that your husband or wife will be upset with you for a deal that isn’t that good. What can you do to get more comfortable with that fear? My suggestion would be to sit down and have an open conversation with your spouse. Maybe that’s not a conversation you’d normally have but if you’re married it’s probably time you opened up and started to talk openly about your fears around your investments. What you’ll probably find out is that your spouse appreciates your concern but supports you. It’s unlikely you’ll erase the fear but now you’ll feel more comfortable to move forward.

It’s possible these issues are actually the issue, and in hot real estate markets with bidding wars and limited supply, lack of good deals is quite possibly true. However, in most phases of the real estate cycle, there are always plenty of deals out there for investors willing to work hard to find and create them. And there is definitely money.

If your fear doesn’t involve a desire to be liked or a fear of being judged then a conversation might not solve it. If, instead, you’re lacking confidence in yourself and feeling terrified you’ll pick an awful tenant you still have to get comfortable with it. My suggestion for you is to think about the absolute worst thing that can happen to you if you picked a

horrible tenant. It is a pain in the ass to deal with but insurance will cover me or I have to spend several thousand dollars handling the issue. I can always come up with half a dozen ways to find the money to pay for that kind of damage and I am sure you can too if you really think about it. After you’ve done that, you have to remember that your absolute worst case scenario is very unlikely to ever happen, but if it does, are you going to survive it? When my husband Dave and I are preparing to present an investment opportunity to one of our money partners, we always plan for them to say yes. We prepare and practice what we’re going to say so that we can deliver the message clearly, concisely and with confidence. Sometimes they say no and once in a while we turn them away because we don’t want to work with them. You might feel like there is no point lining up your mortgage broker, lawyer and property manager until you’ve found a good deal. The reality is that you’ll probably never find a good deal until you’ve planned for your success. Your own self-doubts are holding you back from doing what you’re going to need to do once you find that great property. And you know what? Once you are ready for that deal it will probably be right there under your nose! Fear can be overcome by simply taking action that

moves you squarely towards what you’re afraid of. If you are afraid of rejection from a potential money partner, nothing else will help you truly become more comfortable with that fear than sitting across from someone and risking that NO. The objective here is not to eradicate fear. Fear is important. The day you stop fearing you could make a mistake is almost always the day you screw up big time. Fear will keep you checking in to make sure you’re taking precautions. Let fear do its job to keep you safe but do not let it anchor you. Get to know it so you can recognize when it is protecting you from something real versus scaring you from becoming as great as you can be. Once you feel better that it is a fear of something that won’t kill you or damage your life forever, you can move forward to planning and taking action.

How to An

nalyze a Real Estate Deal How do you know if a property is worth purchasing? For Julie, she can figure out this question in about 60 seconds after she steps into a property. Of course, a lot of it has to do with experience, but there are some rules and questions to consider in order become an expert at this!

How to Analyze a Real Estate Deal By: Julie Broad I walk into a property and can figure out whether we should buy it in about sixty seconds. I can quickly guesstimate what the rent we can get is (we’re submarket area experts, so I know what rents for what price in this area off the top of my head); and I know the price range within which I can buy this place and make it work because we’ve done so many deals. I also get a feeling from a property. You probably do too – even if you don’t pay attention to it yet! Feelings, of course, aren’t enough to buy a property on, though. You are looking for the real estate deal that is going to meet your goals. To achieve that, you’ll need to be able to analyze and value the property and figure out if it’s going to make you money. Your job as you evaluate specific properties is to disregard the list price or what the sellers may want for it and focus solely on what it’s worth to you! Don’t worry about the city’s property assessment or what the sellers paid for it. Those numbers are mostly irrelevant. You may be able to use them in your negotiation if it comes to that, but for the purposes of evaluating the property they’re not important. As you look at the property, consider the following: • What is the area zoned for? (What else can you do with it? Can you add retail or office space or additional units?). What is its highest and best use? • Are there any restrictions on the use of the property? • What is the immediate area like? Are the other houses well maintained or not? Are there parks? • What is in the area that is attractive for someone living there? Schools, shopping, medical services, police/fire and other services? • What kind of transportation options are within a few blocks? • What condition is the property in? Exterior and interior? • What is your gut telling you when you see the property? How do you feel when you’re in the

• • • •

property? Are there easy things you can do to improve the appearance of the property? Are there any environmental risks to consider? Earthquakes, hurricanes, mold, termites, asbes tos, bed bugs, etc.? Who lives there now? Tenants or the owners? Some of these things you can assess using maps and information you can gather from the internet, but most of these questions require you to physically be there to properly answer them.

Then, to figure out value, you’ll need to do the same evaluation for other properties that are on the market, as well as those that have recently sold in the area. You’ll also have to spend some time figuring out what kind of rent rate you can get for the property. If two properties are comparable in size and location, yet one property (on a dollar per sq. ft. basis) is much more expensive or much cheaper, it’s your job to figure out why. The cheaper property may be in a slightly worse location. Or it could be on a noisier street, or near a garbage dump, or in a position where it gets less sun, etc. These are some of the things you’ll need to determine to figure out value and possible rent rates. You will need to gather most of the following information to calculate cash flow: • Rent • Property taxes • Heat/hydro (and who pays for it – the potential tenant or the owner?) • Electricity (again, who pays for it?) • Garbage/sewer/recycling fees • Property insurance (you can speak with an Insurance Broker for an estimate) • Property management (again, you will want to research this to get an estimate) • Maintenance of the building/property.

Separate from the above, you will want to come up with a rough idea of how much you will have for a down payment – so you can estimate your financing costs – and also get an estimate of the current interest rates. (You can check this online or speak to your bank or a mortgage broker.) Many of the items above can be estimated until you have an accepted offer on the property, at which point you’ll have easier access to the real numbers. However, the more actual numbers you can obtain from the seller (or seller’s agent) and from your various sources (banker, broker, insurance agent, etc.), the more accurate your cash flow prediction will be. Whenever we begin analyzing a real estate deal, we always use the following rule: Income/Financing Ratio: 65% of income should be the maximum financing (mortgage principal and interest ) cost. E.g., if rent is $2,000/month, financing should not exceed $1,300/month (2,000 x .65 = $1,300). Hopefully it is obvious that you are going to take the monthly rent (and any other income like monthly parking or laundry income) and subtract all the monthly costs. If an expense only comes in an annual amount (like insurance or property taxes, for example) simply divide by 12 months in order to get your monthly rate. We look for deals that are going to cash flow at least $300-$400 each month. That gives us room to wiggle if rent rates drop or we have some other surprise. A Few Words of Caution … Just Because Your Number is Positive Doesn’t Mean It’s a Good Deal:

Did you include an amount for property management (usually 10% of your monthly rent cost)? Even if you are going to manage the property yourself, it’s always wise to have a buffer – in the event there comes a time where you can no longer manage the building yourself and need to hire a professional. Sometimes, when we’ve moved cities, changed to more demanding jobs, or just couldn’t handle the strain and stress of managing the properties, we’ve gone from self-managing to professional management! What rent did you use? Is it likely? Knowing only the expenses won’t help you if you haven’t determined what rent you’ll be getting. It’s imperative that you obtain accurate rental information in your chosen area and for comparable properties. You need to be a shopper of comparable properties. If it is a bedroom house with a 2 bedroom suite, you need to look at all the local listings and see what is comparable and what they are asking. Ideally, call a property manager and ask them what it would rent for. If your chosen property is already rented, then hopefully you were able to find out the current rent from the listing, the listing agent, or your agent. Are the current tenants in a lease already, or is it just month to month? Asking the rent rate that the current tenants are paying is not enough research. It’s entirely possible they are paying way more or way less for some other reason (family, friends, etc.) but it’s still important to know what they are paying.

Tenant Profile C Success

Critical to For those of you who already own rental properties should know the importance of the quality of a tenant. This article will show you why tenant profile is critical to your success as a property investor. Read on to discover how you can identify a good tenant vs a bad tenant and what items should be included in your checklist when it comes to looking for one.

Tenant Profile Critical to Success By: Paul Kondakos Everyone has heard at least one horror story from a friend or acquaintance about someone who had a tenant from hell. Dealing with tenants is actually one of the biggest fears that potential investors have, let alone dealing with problematic tenants. In many cases, the thought of having to deal with them is enough to keep prospective investors from investing ... which is a shame because that threat can easily be mitigated. Owning an investment property is tantamount to owning a small business. To succeed in business, you have to ensure that you have a good client base that respects your business and pays its bills on time. The same holds true for succeeding in real estate investing, you have to ensure that you have a tenant profile that respects the property and pays its rent on time. For most novice investors, the tenant profile is likely something that hasn’t even crossed your mind, but it is actually one of the most important factors to determining your success. Some of it is tangible and some of it is intangible. As you become more experienced, you’ll get a better feel of what makes a good tenant profile. There are 2 occasions when you have to pay particular attention to the tenant profile. The first is when you are purchasing a new investment property. Assessing the tenant profile has to be a consideration because a bad tenant profile can cost the novice investor time, stress and money. On a side note, for the more experienced investor a bad tenant profile isn’t necessarily a bad thing as; (1) the experienced investor knows what they are getting into; (2) the property is usually priced accordingly, and (3) turning around the tenant profile can be a lucrative proposition. Assuming Tenants - Talk to Every Tenant When purchasing an investment property, the buyer has to assume the existing tenancies so you

need to ensure that you are comfortable with what you are getting as you have no control over who is currently living in the property. The best way to learn about your prospective new tenants is to talk to them. Be present at every inspection and to try to schedule inspections for the weekend or evenings as most tenants tend to be around at that time. Depending on the reports required (eg. appraisal, building condition assessment, phase 1 environmental), you will likely have at least 2 occasions to meet and talk to them. Always take personal notes so you can review and assess in its entirety afterwards. Engage the tenant in small talk. This will not only reveal potential issues with the building, it will give you a good idea of the tenant’s personality. Things to looks for: • Cleanliness of unit • Items that shouldn’t be in unit (eg. washer/dryer, moped - I found one in my latest building inspection) • Pets (loud, neglected) • Does the tenant seem personable and cooperative? • Does the tenant like to complain alot? • Does the tenant work, do they have anyone that stays over, do they like living there, do they get along with their neighbours? After a quick inspection and short conversation you can usually tell what type of tenant this is going to be. Once you have inspected all the units and hopefully met all the tenants and have taken good notes, you can review and decide on whether this is the type of tenant profile that you would be comfortable assuming. Renting to New Tenants - How an $11.30 investment can save you thousands! Here you have a lot more control of your tenant profile as you decide who gets to live in the prop-

erty. This is where you need to be diligent and selective about who you let in as it will make all the difference between owning a profitable and headache free investment or owning a money-losing and headache filled investment. All too often landlords are more concerned about filling vacancies than the quality of their tenant profile. In the short term they may fill a vacancy, but in the long term, it always, always costs them more ... I know from experience. The ability to come up with first and last month’s deposit should only be one of the criteria, and certainly not the only one. You need to learn as much about your prospective tenant as possible. My checklist includes the following: • Letter of employment or pay stub • Call employer to verify employment and get reference • Call previous landlord for reference • Tenant traits - Appearance, punctuality, demeanor

• Do an online search (eg. work, hobbies, activities, asssociates, etc...) • Credit Check (Price: $10.00 + HST) - The single most important and effective way to forecast if you will get your rent on time every month. People earn good credit scores by being responsible and diligent with their financial obligations. I typically look for a score of 680 or higher. While it may be tempting to fill a vacancy with a suspect tenant, you are ALWAYS better off to absorb the cost of the 1 month vacancy and hold out for a good tenant to occupy the unit. What’s the Big Deal About the Tenant Profile Anyway? As mentioned earlier, having one bad tenant can significantly affect your investment and your

stress levels. When I first started off, I was a lot more lax about who I let into my properties. The application, first and last, and a call to the previous landlord was about the extent of my due diligence. This lack of scrutiny ended up costing me tens of thousands of dollars and lots of stress. Below is a sample calculation of how much one bad tenant can cost you: ______________________ Lost Rent (assume $800/month): $2,400+ Tribunal Filing Fee: $170 Tribunal Representation (if you donâ&#x20AC;&#x2122;t go yourself): $200+ Sheriff: $330 Repairs and Renovations (almost every tenant I have evicted has left the unit in need of repair): $3,000 Intangible Costs: Stress, Your time, Tenant Profile Total: $6,100 + Intangible Costs ______________________ I own and manage close to 100 doors right now and I find it easier to manage now, ever since I became more prudent with my due diligence and started checking credit scores, than I did when I owned substantially less doors but did not run credit checks. With a good tenant profile tenancies tend to last longer and when tenants give notice to vacate, transitions are almost seamless. A good tenant will give proper notice which then gives the landlord enough time to advertise and rent the unit (which is usually left in good condition) out to a new tenant without incurring any vacancy. This not only maximizes your revenues, but also minimizes your stress and headaches as a landlord. In closing, pay close attention to your tenant profile as it is one of the most important elements to running a successful and profitable investment property. Author: Paul Kondakos, BA, LL.B, MBA - Professional Real Estate Investor