Another remote zoom podcast! Today we bring to you episode 9 of our YVR REMO Show with special guest Kosi Stobbs.

Kosi, also known as The Property Owl, is a business owner and has built his wealth from real estate. He has a unique business mindset and provides us today with a great amount of knowledge. Let's dig into his story!

Kosi's journey started with his first property. He saved up money while working at Burger King for $4.50/hr! He was able to save $200/month. Upon graduating from university, he had $8,000 saved up. As a first-time homebuyer, he was able to put down 5% on his first home purchase. This first property was a run-down townhouse. He started calling many realtors and asked one question, " I want to own ten properties by the time I'm 30, can you help me?" His goal was to find someone with experience. Diving into his first unit, he followed his realtor's advice. Two years later it was worth $200,000. He went from saving $200 a month to five years getting that to $8,000 and eventually saving $65,000. This was enough for him to invest into a property.

A side hustle is easy to do but harder to stick with. Kosi's mindset is always set on how he can get forward in his investment endeavors.

Kosi's parents bought a home shortly after coming to Canada and proceeded to upgrade until they had their dream property. They owned their last property outright for $500,000. This is generally what the traditional person does. If they had changed their strategy they could have made more. This could have been done by instead of selling the first property, refinancing and buying a second. They could have rented the first and made the extra income. At retirement age, they could have been renting two properties and living in a third. You could possibly have three properties growing at 5%.

His strategy is built to handle downturns, you have to anticipate it. The amount of cash he keeps with each property is to prepare for this. It's usually around six months of operating expenses. It can also account for vacancy rates in the area. You never know when you will need to pay for an empty unit or repairs as a landlord. Real estate appreciates but the components depreciate. Do you have enough money to keep up with maintaining the property?

Example: Let's say you have $80,000 available to invest in real estate. Run the numbers then quadruple them. If you need $5,000 push that to $20,000. Instead of putting $80,000 down, put down $60,000, and buy something smaller. You can now put that $20,000 down in contingency. That $20,000 gets put in the bank and only used on that property. Your rates on return will be lower but your sleep at night will be better knowing you have everything taken care of.

It's easy to do well for a short time in this industry but the key is longevitiy. Make sure you are buying the right cash flow properties, take into account the risks, and choose the right time to buy. Upcycles, downtimes, and flat markets are all great times to buy if you apply a different strategy for each. From a business perspective, operating businesses need to focus on sustaining that business. The time we are in right now can be difficult as a business owner or landlord. When the markets hot, you may find one or two properties out of 100 that may work. You want to avoid bidding wars in order to get a good deal. In a down market, you can get more aggressive with prices and terms. You cant find more availability because there are people that have no choice but to sell.

Kosi uses a money triangle. The foundation is making sure you have a plan and the right level of knowledge. You need to be established and have your finances in order. Thes second level is what you're doing to make money with consistent and predictable income. At that stage, you can start to invest. In a down market, he puts a higher percentage down in reserve. This is because even if you don't get a tenant for 2 years you will be ok. This is a long term investment. If buying, you should acquire good properties that work and will benefit you in the long run. Stick to your plan and its hard to not be successful.

There's never a wrong time to buy an investment property if you have a plan and everything in place.

The best place to find Kosi is Instagram. His tag is @thepropertyowl. Make sure to check him out and engage with his posts which always teach and educate on his ways of investing and building wealth

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