When I said nothing, I really mean nothing. My uncle, Uncle John, who’s merely 7 years older than me, had nothing when he first landed in Canada.
It wouldn’t be far off if you use the term FOB (Fresh Off the Boat) to describe how he got to Toronto. He was trained to be an engineer on a cargo ship in a college in China. He is the youngest of 7 siblings from my mom’s side.
He just happened to arrive with his ship at a town in BC two hours north of Vancouver, shortly after my family moved to Toronto from Hong Kong.
With the small amount of pocket money provided by the shipping company that he worked for, he managed to take a cab ride to Vancouver and rented a motel to stay for a night. My mom was able to pay for his ticket at the time and he flew over to Toronto the next day.
That was over 15 years ago.
He had since worked as a bus boy in a local Chinese restaurant for years. He realized that job didn’t really have any future. He then worked as an apprentice in a HVAC company providing customers with tips to maintain your hvac. He progressed rapidly within the business too. With his background in machinery, he started his own HVAC business a couple years later.
Today, Uncle John is married and has two young boys. He owns three properties, combined of over $1.5M in value and a business that’s sufficient to support his entire family. He has more business than he can handle. He has to turn away some of our referrals.
Contrary to common belief, not every immigrant comes with money.
But if you work hard, have good ethics, are willing to take some risk, and put some savings aside, have a small business accountant as part of your team, you too can create your own Canadian dream.
As a real estate investor myself, we get so hyped up with buying the next investment property. We often forget about our own home, which is the biggest tax free asset that you can own in your life!
Believe it or not, $1 appreciation in your home is equivalent to $2 of rental income you earn (if you are at the highest marginal tax bracket).
Uncle John made some decent money from his business. He invested in penny stock and he invested in a small commercial unit in Scarborough thinking he would open up a store to attract more business.
He didn’t make a dime off any of these investments.
He is losing money every year at his commercial unit. He barely broke even on his penny stock investments.
He learned about real estate investment a couple of years after seeing a few of his friends accumulating tax free wealth by upgrading their homes every few years.
He bought a pre-construction home 3 years back. He just recently sold the property after staying there for a few years.
He made over $150K, using the biggest tax free asset a taxpayer is allowed from this property.
He finally made his decision to sell the commercial unit and liquidate all his penny stocks, putting everything he has in his principal residence to get a bigger and better home for his family. This was, the house would be perfectly designed to meet their own needs and will last them much longer than a house they have just bought.
Time will tell whether this will be a good investment decision.
But as of today, he’s accumulated over $1.5million of asset in the last 15 years, starting from absolutely nothing.
The Canadian Dream can come true, with a bit of luck, a lot of hard work and a good Toronto accountant. 😉
Until next time, happy real estate investing.
Cherry Chan, CPA, CA
Real Estate Accountant
