The general investment strategy is to locate under-managed, under-valued (and sometimes ugly) properties in decent areas of promising cities. (“class C or class B building in a class B area”).
This property will be acquired, impeccably managed, appropriately renovated and financed from the start or re-financed after approx. 9 to 15 months.
The rents will have increased and therefore, the value of the building. The building will be sold at a set exit point, approx. 20% to 40% above the purchase rice, or at a pre-set point-in-time or as condominiums, or will occasionally be held long term for cash-flow purposes with liquidity events, depending on the specific project or pool.
Astute Property Investments provides an easy, low-risk yet tangible asset/investment vehicle that has the following benefits:
1) has positive cash-flow after all expenses
like: mortgage payment, condo fees or perating, taxes and rental management fees
2) appreciates over time, tax free like an RRSP until sold
3) provides income on a monthly or quarterly basis (depending on the
mortgage on the condo this monthly income could be small or large)
4) is based in Canada,
5) takes the hassles out of property management
6) provides a one person interface to financing alternatives and purchase
7) makes real estate investment / ownership easy, worry free and even fun
8) is a “real” asset as opposed to a virtual paper-based/mutual fund/stock based
9) provides tax advantages: equity growth on a major portion of the return (the
equity portion, which is the combination of mortgage paydown, value
improvement and appreciation through time) are tax deferred (like an RRSP) but
also tax preferred. Unlike an RRSP, equity gains are taxed at only 50% of income
tax, yielding far higher after-tax returns than RRSP’s can, as RRSP returns, once
paid out, are taxed as income.
This is typically achieved by Astute Property Investments purchasing a building or cluster of buildings with as low as 20 units to as high as 200 units.