I’ve probably watched 80% of the episodes of Income Property with Scott McGillivray – He promotes adding an income suite to your home to help pay down your mortgage, create additional income and increase the value of your home. Along with being a Financial Planner, owning rental properties, consulting with rental property owners and in the process of adding an income suite to a new home, I feel fairly knowledgeable on the subject. An income suite in your home can increase your wealth – it can also be a nightmare if you don’t have the right skillset or do what’s necessary.
Before you start building, there are two important factors you need to consider.
Do you have the right stuff? A landlord has to be a good judge of character, willing to do thorough background checks on prospective tenants, follow up and evict if required? A good landlord is pro-active in their work and decisions to avoid possible problems and responsive when they arise. A good landlord is also meticulous with tracking income and expenses, willing to take care of those little things themselves, and is comfortable with having tenants around the property.
Next – Do you want the quality and have the cash? You need to have the cash or equity in your home to finance a proper, high quality, income suite. Taking short cuts with renovations such as, not using a RenoMark contractor, not getting the right permits, poor quality materials and workmanship will be disaster. I cannot stress this enough, if you want a quality long term tenant, paying top rent, you have to renovate using quality materials and achieve that “wow” when your suite is viewed. This level of quality may even be greater than in your own living area – but doing this right will allow you the future cash flow and equity to upgrade and renovate your space next.
Richard WR Yasinski CFP Richard is a Certified Financial Planner and has been in practice in Ottawa since 1996.
His web site is www.financiallysound.ca
Watch his video on YouTube “Why I do what I do”