Time to Invest Port Alberni

Investors from all over North America have long recognized Port Alberni as a great real estate investment opportunity. Back in 2004, I attended a real estate investment seminar in downtown Vancouver that was held by a renowned investment guru, and specifically singled out Port Alberni has a place to invest. The market was relatively low back then, and climbing, making it a great place to invest for appreciation or cash flow. Interestingly we find ourselves in similar market conditions today.

On a daily basis our team is talking to people all over the country who are interested in investing in Port Alberni. It is remarkable how few of those potential investors are local to Port Alberni. The people of Port Alberni are sitting on a rare investment opportunity and don’t seem to know it, or have the inclination to capitalize on it. This article is intended to share out insight with locals, because that insight might just make a difference in their lives. I can tell you with certainty that local Realtors are investing in the market right now.

In my opinion no other investment can have as consistent and powerful of effect on your net worth as real estate. The reasons for this it is:

  •          Stable;
  •          Accessible;
  •          Appreciable;
  •          Improvable;
  •          Rentable;
  •          And most importantly, Leverageable.

Stable does not mean that real estate markets don’t rise and fall in the short term. What is means is in the long run the market is very stable. Even the short term rises and falls are relatively predictable. Because, there is emotion in a typical home sale, and therefore in the market as a whole, changes in the market due to external forces are delayed.  If you know what to watch for, you can see the change coming months in advance, giving you time to be proactive.

Accessible, simply means that you do not have to be wealthy to get involved in the market.  It is easy to understand, easy to find, and easy to mortgage.

Appreciable means real estate tends to appreciate over time. There are two reasons for this. First, general inflation drives up construction materials and labour, and therefore the cost to replace housing. Second, there is the influence of supply and demand. As the population increases so does the demand for housing.     

Improvable means that you can increase the value of you investment through sweat equity. If you are wise in the type of property you invest in, a small additional investment in improvements can drastically increase the property’s market value, and therefore your equity.

Rentable, means that you can have someone else pay your mortgage. This is huge! I challenge you to find me another easily accessible investment where you can get someone else to pay your loan payment.

Perhaps most important is leverageable. This means that you typically only need 20% of the purchase price in cash (and sometimes less) in order to reap the benefits of the appreciation of the entire property.

Let me give you a real life, Port Alberni, example of the power of these concepts in action. I have a property currently listed for $149,900. For the sake of argument let’s say that you bought it at full price. The building has potential monthly rents of approximately $1,350. Let’s also assume a 10% market increase over the next year. This is what it would look like:

Price Paid $149,900
Down Payment $29,980
Transfer Tax -$1,499
Potential Rents $16,200
Mortgage Payment -$10,062
Taxes -$1,781
Insurance -$1,500
Cash Flow $2,857
Appreciation (1 year at 10%) $164,890
Cash Flow $2,857
Principal Paid Down $6,341
Gain   $24,188
Rate of Return on Price 16.0%
Rate of Return on Investment 80.7%

That is the magic of investing your money in real estate in your own town. This is the power of real estate being appreciable, rentable, and leverageable. The example doesn’t even take into consideration your ability to improve the property through sweat equity. 

I hope this article helps the people of Port Alberni wake up to what the 40% of current out-of-town buyers already know, you can make a lot of money investing in real estate in the valley.

If you want to learn more about investing in Port Alberni please read through the pages of the Investment section on this sties main menu.

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