Kevin O’Leary vs. Scott McGillivray
Kevin O’Leary, infamous “Shark” on ABC’s Shark Tank, former “Dragon” on Dragons’ Den and Chairman of O’Leary Funds, recently sat down with real estate expert Scott McGillivray on The Marilyn Denis Show, to offer their opinions on the pros and cons of investing in real estate. Watch here.
Real Estate is always a good investment
According to Kevin O’Leary too many people invest in real estate when they’re too young, can’t afford it or when the market is in a bad place. Real estate isn’t a sure thing so be aware of your personal circumstances.
Invest in real estate in your 20s
Your 20s is a time to pay off debt (student loans) and find a great job. Renting allows you to be more mobile and go where the money is instead of being locked down.
Falling rates will help first-time buyers
The current market tends to transfer wealth from young, first-time home buyers to mature home-owners who sell their houses. This is especially true in residential neighbourhoods. The condo market is shaking things up a bit, but falling rates only help first time buyers so long as the market stays the same.
A mortgage shouldn’t exceed 25% of your income
According to Kevin this is true unless the area you’re shopping in exceeds the average price (looking in an expensive city). In that case, you can allocate 30%, but these numbers should include everything – taxes, lawyer fees and so on.
Don’t carry a mortgage into retirement
Always clear your debt before you retire says O’Leary. Even if that means selling your house and renting in order to pay off the mortgage. Your first priority at all ages should be paying off the debt.