Our family just returned from a family vacation in Vermont over march break. We drove there, about an 8 hour drive, which for this travelling family is a relatively short trip. For those who don’t know us personally, we have three children. A daughter, 19, and two boys aged 11 and 13. Only the boys joined us on this recent trip as our daughter is away at school.

While driving, the boys will typically play video games for hours on end in the back seat and we don't hear much from them until they get hungry or have to use the bathroom. However, about halfway to our destination our 13 year old son asks “Mom, Dad, if I wanted to buy an investment home in my 20’s how would I do this?”.  Ryan and I looked at each other with equally perplexed expressions and it took us a moment to respond to him simply out of shock. After the moment of shock wore off, we proceed to explain to him the basics of buying and owning an investment property.

We explain to him that for his first home he will need a minimum of 5% down and used a hypothetical house price of $300,000. We let him do the math on it. So he says “okay so I need $15,000 that's not so bad”, he then asks where does the other money come from? We proceeded to explain how a typical mortgage works when borrowing from a bank. So naturally as a 13 year old, he processes this information for a couple of minutes and then asks “Well how much rent do I need to charge to cover the costs of this house?”. Ryan and I exchange another silent perplexed look and then explain that the rent would need to be a cost that is appropriate for the size/location of the home and if he didn’t want to be subsidizing any costs of the investment property himself it would need to cover the mortgage, property taxes, maintenance and possibly a few utilities. He thinks about this for a few minutes and replies, “I don’t really understand what taxes are, what is property tax?”. Wow, do we have a forward thinker on our hands!

After explaining what property tax is, the types of services it pays for and why we have to pay it, he gets a pretty good picture of what he needs to do. He then asks us, so Mom and Dad, “would I still be allowed to live with you when I start working so that I can buy a home and rent it out for a few years to get me started making money in Real Estate?”.  What???  Of course you can, son!

The reason I shared this story is because I wanted to emphasis that there is no age too young to start planning investments, even when buying real estate! And there is also no such thing as too late either! If you want to start investing, no matter your age, I highly recommend you read as many books as possible to get you informed on the types of property investments out there, then start talking to your realtor about how to get started and what areas are good for rental properties. Your realtor is full of experience and advice that will help you get started.  And yes, even in the GTA there is still plenty of opportunity to invest. We here at The Haydar Team don’t  just teach our clients how to invest in Real Estate, we’re investors ourselves. We learn and make mistakes along the way so that we can pass along the experience and expertise to you.