You need time, money or expertise to own rental property

Article by Darah Hansen, Special to the Globe and Mail, September 8, 2014

“It was more accident than intention that led Anni Jansson to buy her first investment property in the growing Calgary suburb of Airdrie, Alta., in 2006.

Ms. Jansson, 39, had planned to live in the three-bedroom townhouse herself, but fate intervened when she met WestJet pilot Jason Hyland. The couple, now married, moved into his Calgary home and decided to put hers up for rent rather than incur the penalty of breaking the mortgage.

It proved to be a good financial move. People were lining up for rentals at the time and Ms. Jansson, who works in sales with a local residential development firm, quickly calculated that she could ask enough in rent to cover all her property expenses and still pocket a couple of hundred dollars every month.

It wasn’t long before Ms. Jansson decided to jump into the market again. She now owns and manages three income properties in Airdrie, and is in the process of closing on a fourth. Her long-term plan is to own up to 10 properties and use the revenue generated to supplement her retirement.

“I don’t have a pension plan,” she adds.

Ms. Jansson is in good company. Thousands of Canadians rely on residential income properties, whether close to home or abroad, to help them feather their financial nests.

Done right, investors stand to reap big rewards over the long haul, industry experts say. But property investment can also come at a heavy price to those who aren’t prepared to learn the market and do the less-than glamorous work of a landlord.

If talk about housing bubbles gives you ulcers, or you aren’t willing to answer the phone at 2 a.m. when the tenants call to tell you the pipes have burst, then investing in real estate might not be right for you.

“It’s like any business that you want to enter. It’s all about time, money and expertise. If you don’t have the time, you at least have to have the expertise and you have to have the money to make it fly,” says Phil McDowell, a mortgage broker in Calgary.”

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