Cash Cow Properties by Sunil Tulsiani - HTML preview

Cash Cows

In today’s confused real estate market it is best to buy properties which generate a positive cash flow every month. These involve a lot less risk and they provide you with great returns so when you find a winner don’t wait too long before making a decision. At the very least put it under contract with conditions (see 28

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Cash Cow Properties by Sunil Tulsiani your lawyer for advice). Then do your due diligence to make sure all the expenses are accurate. Remember that unless you follow through and take action, nothing will happen.

With cash cow properties it is important to remember that it’s no good having a place that produces a good yield when rented but is empty for long stretches of time. Your property needs to be in an area that’s desirable by the type of renters who will pay off your mortgage. Some things to consider include access to public transportation, surrounding shopping malls, plazas or shops, access to good schools, the crime rate in the area and the vacancy rate.

How to buy a ‘cash cow’

This is where the rubber hits the road. Pay close attention to this section and you will be in a good position to provide handsomely for your family.

1. Only work with vendors who, for whatever reason, need to sell their property quickly.

Simply Google words like “Below market value property” or “Cash Cow property” or

“motivated seller”, “quick sale”, etc. Also check your local papers. I find that the Toronto Star is a good place to find good properties.

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Cash Cow Properties by Sunil Tulsiani 2. Find newly developed properties in your area.

For cash flow purposes look for condos, town-houses, semi-detached homes (they all do well in terms of generating cash flow).

Detached homes with separate basement apartments also do well. Go to the builder when they have sold most of the properties and they are ‘stuck’ with just a few units.

Developers, at this point, have made their money and are motivated to sell quickly at below market value.

3. Connect with a knowledgeable real estate agent in the area that you want to invest in.

Be careful, however, to only deal with an agent who is also an investor. They should have several properties tucked in their belt. It is a given that a good agent will be able to find you good properties.

4. If you know someone who is a successful real estate investor get to know them better and take them out to lunch. Ask them questions about their real estate investing or better still, if they have a Cash Cow property in mind, consider going into a joint venture with them.

5. Once again – do what I did. I attended most of the meetings in the Toronto area and I connected with many like minded, successful, real estate investors. They always seem to get many great properties. Join a real estate investment club (like

www.privateinvestmentclub.ca).

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Cash Cow Properties by Sunil Tulsiani 6. Tell everyone you know that you are a real estate investor and marvel at the magic of word of mouth publicity. Someone you know knows someone who can help you set up your Cash Cow property.

7. Build relationships with lawyers (those who are active in real estate and divorce), mortgage brokers, mentors, brokers. Make sure you create a win-win situation by offering them something for bringing great offers to your attention.

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Cash Cow Properties by Sunil Tulsiani

#4 - How to Invest in

a Cash Cow Property

Using Little (or

None) of Your Own

Cash

I know this is a very exciting yet controversial method of getting properties. Some of you probably don’t even believe this exists, I know I didn’t prior to 2005. I thought it was a scam or a way for people to sell their courses. I have attended many of these courses/bootcamps and some of them are structured so that all you can do is keep on buying their advanced courses.

So, have I invested in real estate using no money down strategies? You bet! In fact this is the only way for you to become super wealthy.

As the reader of this book I am going to share with you some secrets I have shared with my elite clients whom I coach. It is very important that you understand this section, it can make you a millionaire (but you need to take action for that to happen).

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Cash Cow Properties by Sunil Tulsiani It’s true. You can profit in real estate without much cash—especially if you’ve strengthened your credit score. But even when you lack platinum-power credit, you’ve still got a variety of little-or-no-cash-down techniques that you can draw on to get you started as a real estate investor. This is something I did and I learnt the hard way and you can too, only you get to benefit directly without having to go through the process of making the mistakes I made.

How to buy a property with no credit and less than $1000 down

Remember this is something I have done on a repetitive basis and there is no real reason why you cannot do it also.

Here goes. First you find a property using the methods in this book. The moment you do, put it under contract with $1000 down (remember you are dealing with motivated sellers). Then you need to find someone who has little time but needs to earn a high rate of return on their investment. Let’s say you followed my advice and have joined a real estate investment club. You simply take your deal there and present it to your fellow real estate investment club members. You show those who have money to invest why your property is a good investment and explore the option of going into a venture together. Your new 33

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Cash Cow Properties by Sunil Tulsiani partner will take on the mortgage and put down the money and you will do all the work. This entails: finding the property, getting it cleaned and fixed, finding the renter and overseeing it (or arranging for a third party who answers to you to oversee it on a daily basis). For your ‘sweat equity’ you will get up to 50%

of the profits.

Here is an example:

The property is worth

$200,000

Your partner puts up 20%

Plus closing costs

$45,000

You buy it for

$175,000

Your agreement says you are a 50% partner Let’s say in 10 years the property appreciates to $300,000. You will have paid approximately $40,000

worth of mortgage payments. Then our equation looks a little like:

Property bought for:

$175,000

Appreciation

$125,000

Mortgage pay down

$40,000

(25 years amortization @4%)

_____________________________________

Total profit:

$165,000

Your investor gets 100% of his initial down payment, then the two of you will split the profit of $165,000

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Cash Cow Properties by Sunil Tulsiani minus any closing costs, 50/50. Note: you will also get 50% of the positive cash flow as well!

How to make money from properties with no equity

Here is another way to invest in a Cash Cow property without using any of your own money and you do not even need an investor or partner which means you get to keep 100% of the profits.

What’s more this is the one scenario where you do not even have to buy the property below market value.

This works mostly outside main cities and for properties which can be rented by two separate families (i.e. basement and first floor).

Here’s how it works:

1. Find a landlord who has grown tired of his property (or someone who no longer wants to own a Cash Cow property). Let’s say it’s a semi-detached house with a finished basement with a side entrance.

2. Check the price. In our case let’s say the value is $300,000. The vendor is motivated but does not want to reduce the price.

3. Find out what kind of return the vendor thinks he can get (typically 5% - 8%). In order for this to work you need to make 35

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Cash Cow Properties by Sunil Tulsiani sure that rents from the upper and lower level of the property are, collectively, higher than the operating costs you are carrying

(which include mortgage

payments and any set up costs).

4. Tell the vendor that instead of taking a discount you will ask him to lend you the down payment and, in return, you are willing to offer them 8% - 12% return on their investment with monthly interest payments.

Here is an example:

Property bought at

$300,000

20% down payment needed

$60,000

(VTB)

VTB (seller finances) the 20%

Mortgage

$240,000

Total monthly carrying cost (fix-ups, VTB and closing costs:

$2,000

Rent for both levels:

$2,300

Money in your pocket:

$300

Word of advice: Not all banks will do no money down deals but some will. You need to have a good relationship with your banker. If you need any help in this area simply send us an email at

sevice@privateinvestmentclub.ca and we will help you connect with someone in our inner circle.

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Cash Cow Properties by Sunil Tulsiani Learn to evaluate a property quickly Remember for a single property, the values are derived from sold comparables. But the thing about Cash Cow properties is that you need to do your proforma quickly. I personally have developed a quick formula for Canada where you plug in the numbers and within minutes you know if the property will make you money or not and just what kind of profit margin you should expect to make.

If you want to develop your own formula make sure you take most of the anticipated expenses into account. If you would like to use my own formula, simply send me an email at

service@privateinvestmentclub.ca

requesting a

proforma sample and I will happily send you a copy.

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Cash Cow Properties by Sunil Tulsiani

#5 – How to build a

Portfolio

In order to build a portfolio all you have to do is figure out what level you would like to reach and simply repeat the process.

For example, suppose you say that you would like to build a portfolio of ten properties this year. This can be accomplished by using the investor/partner method whereby you find great investment opportunities or connect with people who can find great money real estate opportunities and present to people who would like their money to work hard for them.

I can assure you from personal experience that right now there are so many people in Canada and in the US who would like to partner up with you. They are looking for an easy way to make money in real estate and you can be he person who helps make this happen for them.

Since this is a huge subject in its own right, I will shortly be writing a book on the subject covering just how you can raise all the money for real estate.

For now however there are two excellent strategies you can try:

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Cash Cow Properties by Sunil Tulsiani

• Attend your real estate investment club meetings on a regular basis (at least every 90

days) and network.

• Place an ad in a newspaper such as the Globe and Mail or the Toronto Star. You may also Google ‘Free ad in Ontario’ and place your ad on the internet. Some of the websites to consider are: http://www.kijiji.ca/,

www.craigslist.org, http://www.ebay.ca/ and

http://www.nowtoronto.com/

(Now

Magazine).

To help you get started here are two sample ads: Would you like to make 12% - 15% return on your money secured by solid properties? Call XXXXXXX

Are you looking to invest in properties which are below market value? Do not require you to do any fixing and are expected to make 25% return? Visit our website: XXXXXX or email us on: XXXXXXX

Build a database of the people who respond to you.

When you have a solid property you simply go through your list to see who is interested in a joint venture with you.

Remember this will work right here, in Canada, whether you want to get one property or 50, the process is the same. Your financial independence is in your hands. You need to take action.

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Cash Cow Properties by Sunil Tulsiani Just the other day I was in the dressing room after finishing a game of squash. A friend walked by and asked a typical question: “Sunil, is this the right time to buy a property?”

My answer is that if you get properties below market value and they produce cash for you every month then this is the best time to invest. Even if the market

‘softens’ a bit you will most likely do well.

Right now you can get access to mortgages for less than 2.5% - that’s like getting money for FREE!

This is the time for you to take advantage of great properties, In my opinion there will be a lot of new millionaires in the next 3 – 5 years and also there will be a lot of people who will sit on the fence and do nothing. They will be waiting for a dollar to come in, waiting for the USA market to go up, waiting for the media to tell them this is the right time to buy a property. It is up to you to decide where you want to be.

I can assure you of one thing: my members, my friends and I will be making a lot of money in the upcoming lucrative market.

I would encourage you to also take action towards your financial freedom. I wish you all the success!

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Cash Cow Properties by Sunil Tulsiani About the Author

Sunil Tulsiani is

Canada’s pre-

eminent real estate

investment guru.

He is also a

certified business

coach

and an

amazing trainer.

His mission is to

help

those he

mentors

become

millionaires over

the next five years.

A former member

of the Ontario

Provincial Police

(OPP) Sunil he is

commonly referred

to as the ‘Wealthy

Cop’ amongst his

members and

friends. His

lectures, training

seminars,

workshops and

writings have helped thousands of average real estate investors succeed.

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Cash Cow Properties by Sunil Tulsiani Testimonials about Sunil

"I first met Sunil Tulsiani in January 2009 at the first PIC [Private Investment Club] meeting I attended. I joined PIC that same day and remain grateful to the friend who told me about PIC and took me to my first meeting.

Attending PIC meetings introduced me to wonderful young people who were and are energetic, enthusiastic and very eager to succeed…..I learned so much from them and their ability to forge ahead.

As part of my PIC benefits, I was entitled to two free mentoring sessions with Sunil. I found him thoughtful, smart, interested in and focused on me and he initially helped me to articulate my goals.

More recently, in October 2010, I decided to ‘sign on’ with Sunil as my business coach and the process has been excellent. It took me a few sessions to fully articulate what I wanted to do and Sunil had the patience to let me explore where I truly wanted to go. Once I decided on a plan, he has been behind me…..and sometimes, in front of me, all the way. With probing questions, with direction, with suggestions, with ideas. Always ‘pushing’ me, but with courtesy and respect. Now that I’ve launched my new business in 42

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Cash Cow Properties by Sunil Tulsiani a major way, I continue to work with Sunil….he’s my sounding board and certainly my ‘go to person’ in terms of developing my business and confirming my own style and way of doing business.

I appreciate having him in my corner and his business acumen and support is invaluable."

Michaele-Sue Goldblatt, MSW

Founder, WE Women Entrepreneurs

"I met Sunil Tulsiani almost two years ago. Up until then I have been living from paycheque to paycheque, never feeling like I would ever own or obtain property of my own. I never took the initiative to even look at the possibility of owning property. I assumed and accepted that this would never happen for me.

With Sunil’s help I am now the proud owner of my first investment property located in Kitchener, purchased at below market value and producing positive cash flow. I now have instant equity and am working on purchasing a second property. It was the scariest thing I’ve every done and at the same time the most rewarding and exhilarating. I would never have been able to do this without the support and generosity of Sunil. He believed in me, even when I didn’t.

Thanks for everything!"

- Liane Rohm

"Sunil is a confident, trustworthy friendly knowledgeable person.

He is truly a high caliber person with good ethics and motivational skills. He coached me to become a confident real estate investor.

He believed in me and built confidence in me when I wasn’t even 43

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Cash Cow Properties by Sunil Tulsiani sure about myself.

I had very little or no knowledge about real estate investment before meeting Sunil. He coached me and persuaded me to do my first investment in less than 5 months after joining his coaching sessions. I came to know about an exclusive offer in down town Toronto. The property is in the heart of downtown with an amazing view. It didn’t even require any upgrades or repairs and already rented with good cash flow. I also learnt how to do no or very little money down deals.

In another few weeks time I also came to know about another amazing deal through the mentoring program. The property is located in downtown Kitchener, and it is a below market value property and producing positive cash flow. And I made this investment 3 weeks after the 1st one, all less than 5 months into the mentoring program.

Sunil made me a very happy person and brought so much confidence in me. I can’t wait to do the next investment. I highly recommend anyone to get coached by Sunil. If I can do this with Sunil’s help, any one can. I couldn’t have asked for a better coach than him.

Thank you very much Sunil"

- Uthaya Harichandra

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Cash Cow Properties by Sunil Tulsiani Find out more:

Join the thousands of investors who benefit from networking with like-minded people and the specialized knowledge that comes with access through the Private Investment Club

(www.privateinvestmentclub.ca).

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