Nov 132014

The following is by staff writer, Peter.

Buying a new house can be an exciting and a stressful time for anyone. There are a number of different factors and circumstances that must be accounted for and considered. Whether you’re looking to buy a new home for you and your family, or looking to invest in residential property for financial gain, you need to do some research and be smart about your decisions. Buying for your family and investing for purely financial gain are two wildly different circumstances. While purchasing a house to live in is still an investment, there are additional points that need consideration in regards to your family and their needs. This article will focus solely on investment in residential property for financial gain. So if you need advice on house hunting for living quarters, you should go elsewhere. The following tips are not meant to be a foolproof guide to buying property, but if you keep them in mind and go about things intelligently, you’ll come out on top financially.

Type of Property, Location, and the Market

14-11-residential-propertyThe first thing you need to reach a decision on is the type of property you wish to buy. Condos, apartments, and houses all have their own unique advantages and disadvantages when you invest in them. All three can provide you with significant capital appreciation and rental profits, but other factors, like maintenance and documentation can differ.

Once you’ve decided on what type of property you’d like to invest in, you need to find a good location. According to NDTV, there are six cities that are leading the way in residential market recovery and appreciation; Mumbai, Bangalore, Pune, Hyderabad,Chennai, and NCR have all shown growth over 2014 and are likely to continue growing. However, before you jump into buying property in one of those locations, it is still highly recommended that you do some research into the local residential property market. According to Money Crashers, researching local housing markets can help you discover whether the area you want to buy into is likely to continuing growing, or if a housing bubble is going to pop and drop prices and growth drastically.

Monitoring the market on a regular basis is a necessity if you intend to keep your investment for a prolonged period of time. Business Today states that keeping an eye on the fluctuations of the market can give you the necessary information, such as if the market has matured and limited growth is occurring, to decide whether to sell and exit that particular market before prices drop.

A good route to take when looking for a property is to look for residential projects by Unitech Group or other real estate agencies that will have a lot of the necessary information you’re looking for.

Investment Length and ROI

ROI, or Return on Investment, is the ratio of profit earned versus original investment cost. Investopedia describes ROI as a way to measure the efficiency of your investments through comparison and calculation. The usual formula for calculating the ROI on your investments is to take the gain you’ve earned and subtract the cost. The result of that is then divided by the cost, giving you a result that can be changed to a percentage displaying your ROI.

One of the major factors defining whether you get a good ROI is how long you hold on to the property. Business Today suggests holding a property for a minimum of three years (three years is also the period of time differentiating between a short-term and long-term investment for tax reasons). However, they state that the best returns are usually generated somewhere between five and seven years.

Buying a property in the hopes of selling it soon for short-term financial gain is a possibility, but not recommended. Not only are those profits taxed at a higher rate, but you will also miss out on the potential for the serious capital appreciation you can expect to see over a long-term investment.

Finances and Income Stability

Investing in residential property is not cheap. One route you can take to help keep your costs relatively low is to buy into under-construction projects, preferably just as they launch. Doing this is a good way to find investments for long-term capital gains. Regardless of where and when you buy a property, chances are you will need to talk to a bank to get a loan. Dealing with a bank can be stressful, but as long as you’ve done your research and have made sure all necessary documentation and clearances are present, you shouldn’t have any issues.

A reliable, stable source of income is a necessity before deciding to invest. If you don’t have a reliable source of income, getting a loan and investing in a pricey piece of property is liable to land you in some serious financial problems. While a property investment can provide you with a good deal of financial gain, it’s not going to pay off for a number of years, especially if you want to maximize your ROI. Regardless, Jago Investor states property investment is an excellent way to diversify your financial portfolio.



Dec 042013

Marketing in today’s world is very important. It affects how a company acquires new customers and how to maintain its relationship with them. I recently read a story about how a professor was able to explain complicated marketing terms to his students. He basically described the different kinds of marketing with simple to understand examples.

  • You see a girl at a party. You go to her and say “I’m rich, marry me.” – That’s called Direct Marketing :)
  • Your friend goes to a girl and pointing at you tells her, “he is very rich, marry him.” – That’s called Advertising 😉
  • A girl walks up to you and says you are rich, and asks if she can marry you. – That’s called Brand Recognition 😆
  • You say “I’m very rich, marry me,” and she slaps you. – That’s called Customer Feedback 😎
  • You say “I’m very rich, marry me,” and she introduces you to her husband. – That’s called Demand and Supply Gap 😐
  • Before you have a chance to say “I’m rich, marry me,” your wife arrives to the party. – That’s called Restriction from Entering New Markets 😕

Marketing isn’t just about sales and advertising. Even thanking customers through Twitter, or improving packaging design, will help to make a business more successful. The 4Ps of marketing are product (or service,) place, price, and promotion. This means understanding what unique advantage your company’s product has over its competitors, where the target audience is and how to reach them, don’t charge customers too much, and promote your company’s product.


Ultimately marketing aims to match a company’s products and services to the people who need and want them. Good job. Now you know as much about marketing as an MBA student :)

Random Useless Fact: A pancake is a cake, that you make in a pan. And Hershey Kisses.. are really just big chocolate chips.

Nov 212013

Today’s post is an introduction to something I recently heard about called binary options trading. An Option is just a contract between 2 traders that allows one to buy (call) or sell (put) a financial asset at an agreed upon price before the contract expires. So a binary option then, is an option where you get everything or nothing, 2 outcomes, hence binary. In order to trade a binary option you will first need to have a prediction, on whether the price of an underlying asset (eg: stock, commodity, index, currency, etc) will move up or down. Then choose to buy or sell a binary option with a pre-determined strike price and expiration.

For example, Bitcoin trades at roughly $750 each right now. If you think it will be higher tomorrow then you can use binary options to make a trade on your prediction :) Here’s how it works. At expiration all binary options are worth either $0 or $100. The price is a reflection of how likely the market thinks the event will happen. So let’s say there’s a binary option that says the value of a Bitcoin will be over $800 at 3 PM tomorrow. If the market (decided by traders) believes there is a 40% chance of this event happening, you can buy this option for $40. Others who forecast Bitcoins will NOT be over $800, can choose to sell this option and pay $60. The combined total of what you both paid is $100, this makes one complete contract. Then at 3 PM, you’re either right and take home $100 😀 Or you’re wrong and get nothing while the seller wins the $100 :( It’s binary because it’s all or nothing.

It’s easy to see how you can lose money if you’re not careful by just making random bets willy-nilly, but there’s also the potential to make big profits if you have a knack for predicting market trends 😉 Just like trading regular options, you can choose to place either a “Call Option” or “Put Option”


As you can see binary options allow traders to speculate, which is a relatively risky practice. But they also allow investors to hedge, which can reduce the risk of holding the underlying asset. There are many online platforms for binary options trading. A few examples include, which has a community of traders from over 150 countries., which claims to be the home to the 21st century investor. And which says they endeavor to make the trading process as simple and profitable as possible.

This is only preliminary research for me and I think it’s an interesting way to possibly make some extra income. With the Dow Jones closing at over 16,000 today (record high) the stock market is starting to look a bit overvalued so I’m searching for new ways to invest :) I currently don’t have any experience with options yet but I’m interested to learn more about it. Maybe Chuck the professional trader, or the starving artist will stop by and give us their thoughts on binary options in the comments :)


Nov 092013

Twitter’s Initial Public Offering

The micro blogging site Twitter has become a publicly traded company as of Thursday this week. Its price jumped from $26 a share on opening to $48 almost immediately. There is a lot of interest in this hot stock right now. TWTR ended this week at $42 a share. The Twitter IPO raised over $2 billion, the 2nd largest for an internet company. Even more than Google. Not bad considering Twitter isn’t even profitable yet 😕 I plan to invest in Twitter some time in the future, but it’s still too early for me now.



Best Deal of the Year

Future Shop is having a special trade-in offer this weekend that can’t be missed. Bring a copy of any used Xbox 360, PlayStation 3, Wii U, or 3DS game to a Future Shop this weekend and you can trade it in for a brand new copy of: Assassin’s Creed IVCall of Duty: Ghosts or Battlefield 4 for current generation consoles. More details and the fine print here. This means you can bring them a copy of NHL 10 for the PS3, that you’ll probably never play again, and take home a copy of Call of Duty: Ghosts. Even if you’re not a gamer yourself you can give away these new games as gifts and your recipient will think you paid full retail price for them at $60 each 😉 Or you can always just resell the games for profit. Here’s one way to do it.

  • Step 1: Go to a used games store like EB games (GameStop equivalent) and buy any used Xbox 360 game for $10
  • Step 2: Take your used game to Future Shop & trade it in for 1 of the 3 new titles, eg: Assassin’s Creed IV for the Xbox 360
  • Step 3: Sell your new Assassin’s Creed IV game on Ebay
  • Step 4: Profit 😀

Over half a dozen Assassin’s Creed IV copies have sold on over just the last 24 hours alone. The cheapest one was sold at $54.02, and the average sold price was about $57, or slightly below MSRP. This means if you price your game at $50, you’re almost guaranteed to sell it right away 😀 That’s a $40 profit you made, or 400% return on your $10 investment! Wow :)

And if you do this every day over this long weekend, you’ll have $40+$40+$40 = $120 by the end of Monday 😉 I’ve heard this deal is also going on at Best Buy so if you hit up both stores you could double your earnings to $240! If you feel bored this weekend and want to make some easy money, there you go 😉


 Breakfast Recipe

Here’s a creative way to eat your bacon, eggs, and toast in the morning.

Ingredients: See previous sentence.

Instructions: Follow the visual guide below and bake until it looks like the final image.


[Edit 1:10 pm PST] Apparently the news about the trade in deal on my blog has generated massive gatherings of people across Future Shops and Best Buys across the country. [/edit]

Aug 132013

One of the benefits of home ownership is the ability to secure a loan against it, other than the primary mortgage. This can be done through a home equity LOC, or a second mortgage.

A few years ago I was part of the young and prudent group of people in their early twenties who bought a home in Canada when we could still amortize an insured mortgage for 35 years. I bought a $230,000 apartment with a $15,000 Down Payment which unfortunately meant I had to purchase insurance. Who at that kind of age can afford a 20% DP anyway? 😕

Most Canadian banks will let someone borrow against their property up to 80% of the market value. They call this the loan to value ratio. 80% LTV ratio gives the lender a 20% margin of safety, meaning local house prices would have to drop 20% before the bank will be at risk of losing money.

Maximum I can borrow = 80% of property value = 0.80 x $230,000 = $184,000
My mortgage balance in April 2009 = $215,000
Difference -$31,000 :(

Since I’m already borrowing more money than what my LTV amount will allow, I can’t unlock any potential liquidity in my home 😥

Okay, now fast forward to today. By only ever paying the minimum on my mortgage payments the balance on my mortgage has barely changed. Today my mortgage balance is about $202,000. You’re probably thinking cheese-&-rice, Liquid, after 4 years you’ve only managed to pay off 6% of the initial principle? I know. It’s not very impressive :P, but that’s just how I like to roll :roll:

Earlier this year in April I blogged about how I won a farm at an auction and had to raise $25,000 to complete the downpayment by August. Luckily the purchase deadline has been pushed back until October, but I still need to come up with the money nonetheless. So back in May I decided to apply for a Home Equity Line of Credit with CIBC. The appraisal came back valuing my apartment at $280,000 :)

Maximum I can borrow = 0.80 x $280,000 = $224,000
My mortgage balance in May 2013 ~ $203,000
Difference = $21,000 😀

Ding Ding Ding! I can get another loan 😀 The entire application process took about 5 weeks. Afterwards I saw that a new HELOC has been added to my list of Credit accounts. I haven’t used it yet but I will when I require the money.


For a long term investing strategy I believe it’s much more effective to invest aggressively, especially when you’re young, rather than pay down the mortgage quickly. I could have committed an extra $200 every month towards tackling my mortgage. But that wouldn’t even add up to $10,000 over the last 4 year period, which is almost laughable compared to the property appreciation realized in the same amount of time 😉

Just imagine the massive savings effort it would take for someone to pay down an additional $50,000 off the principle on their mortgage 😯 Now imagine someone else who buys a 2nd home, waits around for several years, and also experiences a $50,000 net worth increase. Which person would you like to be 😎 ? Nobody ever gets rich by paying off their debts 😐 We get rich instead by continuing to build our asset column. This is exactly why I chose to put my savings into acquiring that farm (an asset that will generate $5,000 of income per year) instead of into the equity of my home. Continue reading »