B.C.-born Janet LePage, 30, principal of Vancouver- based Lepage Property Investments Ltd. has advice for other Gen-Yers who can't afford to buy a Vancouver house: buy in Phoenix, Arizona and leverage into the Vancouver market.
In 2008, LePage bought her first Phoenix house. Today she has a personal Arizona real estate portfolio that includes houses, condos and an apartment building, with a total value of $2.3 million and a capitalization rate of 9 per cent.
"The Canadian dollar is at par, Phoenix housing prices are at one-third of former value, interest rates are at the lowest level in history and Phoenix has both a strong rental market and rising real estate prices," she said, "this is an historical opportunity."
LePage has developed a lucrative niche in the growing flow of Canadians buying in Phoenix. Working with Todd Smith of AZ Performance Realty, based in Phoenix, LePage provides turnkey real estate services for Canadian buyers. She will find an investment, secure the financing, find the tenants and provide full-time property management and even painters, cleaners and any other trade needed. LePage gets a cut on every AZ property she helps sell, and she also continues to invest herself in she considers to be the Number 1 housing market in the US Sunbelt.
With degrees in computer science and business from Simon Fraser University, LePage left a secure executive position in the telecommunication industry to start real estate investing. She says of the first two Phoenix houses she bought in 2008 – for around $130,000 each – "the best investment I ever made."
"I have had 100 per cent positive cash flow," she said from her False Creek condo.
The slightly-built LePage has been known to go elbow-to-elbow with other investors on "court house step" sales in Phoenix, where crowds of macho buyers jostle for auction properties – "You have these big guys with three cells phones going." – but she says she now relies on AZ's team. "I will be on the cell phone from Vancouver for a client and Todd will be on site."
Vancouver's house prices are unattainable for the young buyer, LePage said, but Phoenix, where houses sell for an average of $111,000 and condos can be found for half that price, provides the opportunity for young Vancouverites to get their foot into an appreciating real estate market. "Vancouver is a great place to invest, but a lot of people can't afford to buy that first property," she said.
LePage said the Phoenix market has changed from when she first got into the market. "It is a feeding frenzy now" she said, "I am often outbid on properties." But, she said, there are still bargains to be had and leverage to be gained. "You can still buy condos for $50,000."
