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How to Build a Toronto Real Estate Empire From Scratch with Sahil Jaggi

How to Build a Toronto Real Estate Empire From Scratch with Sahil Jaggi
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Table of Contents - How to Build a Toronto Real Estate Empire From Scratch with Sahil Jaggi

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George El-Masri [00:00:00] Thanks for joining me today, I interviewed Sahil Jaggi, who was actually a very cool guest to have on the show because he was able to build his fortune, his wealth in real estate in Toronto, which is something that it really was unexpected because he's so young. So a lot of people today, they're not able to afford Toronto and they're not able to build a portfolio out there. And that's why we kind of advise them, listen, instead of buying like a condo there and spending six, seven hundred thousand, why don't you go out to some of these areas like, well, for Hamilton St. Catherine's, well, in Brantford and buy yourself something decent that you can refinance and whatever. But anyway, he was able to to buy a bungalow to start off, and his strategy is to go after properties that he he thinks will appreciate because of the area, the proximity to the subway, all sorts of different factors that he discussed on on the episode. So I think if you are interested in investing in Toronto or just seeing a different style of investing, which is more based on kind of the future values of the property and outpacing the market appreciation, this is a good one for you. Check out. So have a look or have a listen. If you're on iTunes or on the podcast platform, if you're on YouTube, enjoy the show. And if you happen to have any friends or family that are looking to invest in real estate, reach out to me. Let me know. I would love to work with them. You can check on my website while off Dossie or send me an email George at Well-off Dossier and I look forward to working with your friends and family. Welcome to the War podcast, where the goal is to motivate, inspire and share success principles. I'm here with Sahal Jagi, who is a real estate investor, a realtor born in Delhi, India. And when he came to Canada as I guess, an immigrant, he he started off with a lot of student loans, was deeply in debt. He was able to save some money from working a year in New York, doing a banking job. And then from there, from the savings he had, he purchased his first property in Toronto with his uncle, Young and Finch, for about five hundred fifteen thousand. From there, he's been able to take off. And and one of the interesting, interesting things about Soheil is that he invests in Toronto. So a lot of people are we kind of tell a lot of people that Toronto is a very expensive place and it's very difficult to make it work, but he's been able to do so. So welcome to the show. Thank you for coming.

Sahil Jaggi [00:02:29] Thanks for having me.

George El-Masri [00:02:30] Very good. So what I like to do is kind of start off by asking you about your childhood. Sure. If you want to tell me about Delu, but some of the things you remember from from being a child,

Sahil Jaggi [00:02:42] So zero to 60 years I was in Delhi, my entire family still lives back home. So I was in a poor part boarding school from 12 to 16, you know, grew up in a nice, uh, nice little neighborhood in Delhi and, you know, just a regular businessman family. My dad's always been in business. He was a trader. He used to import food chemicals from China. And he used to distribute it to like big companies. Always grew up watching him do business, how he interacted with people. And I think I always had the dream of being I think it was embedded in my DNA to just be an entrepreneur or not work the nine to five. That being said, life is not that, you know, pretty back home. So, you know, my parents worked really, really hard to get me to come to Canada and I knew the struggle. And I guess you appreciate it a lot more when you grow up, right. That how much they had to go through to get the immigration and put me to a really nice school and whatnot. So I did one year of high school in Canada. And when I came here, I was living as a you know, with my one of my aunts and uncles and I was living in their house for like a year and then moved in to move to Wilfred Laurier University. Got accepted in finance and economics.

George El-Masri [00:03:56] Right. So you said that your dad gave you two months or sorry, two semesters worth of tuition. Right. And you you were on your own from there.

Sahil Jaggi [00:04:04] That's right. And that's that that was you know, it wasn't that I was under pressure for that. He was it was fair because he that's what he could do. And that, you know, to even give me an opportunity to do that was such a great I'm very grateful for that until today. And, you know, look where I am. Yeah. You know, he I clearly remember he said that he's like, I can carry you for eight months after that you're on your own. And you know that obviously inherently for me, you know, I was just goal from the time that I came to Canada. There was no time to waste, no time to get used to the cold weather or difference in culture completely, especially being in your teens. It was obviously an adjustment. And, you know, I from the time that I came into Toronto, it was just go time. And, you know, I had some jobs that I was doing while I was in university. I was raising money for the alumni. I was working in people's jewelry, any job that I could get and of course, Canada. Gives you the opportunity to take the student loans and get a degree, and that's what I did, right.

George El-Masri [00:05:03] What are some of the main differences that you saw in the culture that you just kind of mentioned?

Sahil Jaggi [00:05:09] So, I mean, it's a very close knit society back home here. I think it's not just the weather. I think for a person coming from back home to here, people are a little bit more I guess they're more about their own life, neighbor to neighbor. It's a little bit more of a helping each other kind of society back home. And I think a lot of immigrants or a lot of people from other countries can resonate right away. Like, you know, if something goes wrong in one household and households get together and we solve the problem together. Yeah, Canada is very different that way. But, you know, I was excited. I was I've always been a positive, you know, happy go lucky kind of guy. So when I came to Canada, I love the fact that right off the bat I was able to see diversity. I didn't feel like I was in a place where it didn't feel like home. And, you know, today, if somebody even suggested the idea of moving back, you know, I was home for me. Yeah. But, yeah, this is definitely a huge cultural shock for anybody. But it's in a good way. I mean, there's pros and cons of every every country and every culture. But, you know, when you come from a place where you don't really have a choice to look back, you adapt and you move on. And I think I've taken that even in business. Yeah.

George El-Masri [00:06:17] Why did you choose to come to Canada? Not anywhere else in the world.

Sahil Jaggi [00:06:21] You know, mainly in India. There's two options that everybody or maybe three options. Either you go to Australia or you go to London or you go to us or you go to Canada. If and if you compare the tuition rates and the standard of living rates at that time, at least in 2003 when I moved in, it's it was a lot more expensive and also to get into universities. And Canada has always been a little bit more of an immigration friendly country. It's a lot easier process to get into university. And of course, Canadian dollar at the time was a lot cheaper than us. And, you know, everything made sense for me to go to Canada. And you know what? It's got a good reputation to be as a welcoming nation. So I guess that's what my parents at the time decided. And I was all over it. I was ready to go.

George El-Masri [00:07:03] Right. Yeah, that makes sense. So when you when you got your degree, you went to New York to work for one year. Yes. Um, how were you able to save eighty thousand dollars where you earning like a substantial amount when you were in New York.

Sahil Jaggi [00:07:18] So I was there for, like, you know, almost 18 months. It was a year and a half. And one thing is that this was way before the crash happened. So if you got a job on Wall Street as an analyst, stayed out of school, you make money. Right? It's not like today where finance has become a lot more competitive. And, you know, there's a lot more. Back in the day, you were well paid if you made it to the, you know, in the big shop. Yeah. So and another thing that people don't realize is we call it nine to six back in banking, we used to call it six to nine. You work 10, 12, 14 hours a day, seven days a week, which means that you have no life. And the funny thing is that who are like couple of my friends came to visit in New York and they saw all these places while I was working. I barely got to see the city. Yeah. So everything you make you save and you work all the time. And of course, the US conversion rate to Canada, it helped me, you know, save up about eighty thousand. And that year and a half that I worked in, I did really well. So it's not like the job wasn't good for me and I got fired or anything. It was just not my calling. And that's what made me think, like, you know what? Being in an office job is just not my thing. So I want to go back. I miss my friends that I made in University of five years and I missed Toronto. So I came back with the with a decent amount of savings. And, you know, that's when I got into real estate.

George El-Masri [00:08:32] Did you know right away that you wanted to invest in real estate or was it were you thinking maybe stocks or. I don't know what you were thinking at the time.

Sahil Jaggi [00:08:40] So coming from finance? Absolutely not. I had no idea what I was going to do when I came to Toronto. The only thing I knew is that I don't want a nine to five job. So I completely shifted my career from finance to into corporate sales. So I got a job with Nestlé Canada. I was doing corporate sales for them about two and a half years. And, you know, a lot of people at the time, again, are looking at me all crazy, like you have the dream job in Wall Street doing finance. Why the hell would you come here and take up a corporate sales job? And Nestlé? Yeah, even people at the interview were just looking at me like, are you sure this is what you want to do? Because you have a pretty solid resume and you could get be getting a job in one of the good banks. And again, back in the day, finance was the thing, but I knew it. I said, you know what, like at twenty three. Twenty four, if I'm not going to make a career switch today, it'll be too late at twenty eight. And I absolutely hated being in finance so I only knew what I didn't want to know, didn't want to do, but I didn't know what I was going to do. Yeah. And that's when I started working with Nestlé. And as you know as a salesperson you don't have an office. I was mobile, you get a company car and you basically work in your territory. My territory that was given to me was North York. So I the only restriction was that I couldn't live outside of North because I was covering a territory with all my clients in North York, Toronto. So when I got the job. My job was to drive around and I guess the first thing was like, you know, I don't want to waste money on rent. I should start looking into buying a property. And that's how I guess my first property came about.

George El-Masri [00:10:11] Got it. OK, so you took your eighty thousand you reached out to, I guess, some family members and. Yes. I understand, so you pick Toronto because you were thinking about a place to live. Yes. You were kind of house hacking, as they say today. Yeah. So you decided to buy a place that had two units, your first.

Sahil Jaggi [00:10:29] Yeah. So it's the search started. But again, the idea that I didn't want to rent, I wanted to own something. Yeah, right. And again, this comes back from, you know, my childhood days where, you know, you hear people talking, you hear elderly talking and back home, like owning property is a big thing. And, you know, a lot of people miss that being in Canada, that when immigrants come into Canada, if you look at the stats, everybody wants to own a home when they come into the city and they're you know, so that's that's the mentality I always had. Like, you know, I shouldn't waste money on rent and I'm a finance guy, so the numbers don't make sense to me. Right off the bat, I was like, I need to own property. So I first got is always like, hey, let's go buy a condo. And when I was looking at a condo at the time, a two bedroom cost about three hundred and eighty three hundred ninety thousand dollars on Young Street, which is a great location. And I was like, you know, what? If I get a two bedroom share the unit, I should be fine. But then when I looked at the houses just behind Young Street, I started looking at these big 50 foot lot bungalows selling for about five hundred five hundred fifty thousand. I'm like, you know what if I partner with somebody, live in my basement, rent out the main floor, it should pretty much pay for my mortgage payment, more or less. Yeah, and owning a freehold property just seems better to me, like, you know, it just made sense. And that's how I you know, I talked to my uncle about it. I showed him the numbers. And he also comes from a little bit of a real estate background. And he's been in the country a long time. And he's like, you know what? That sounds like a great idea. Let's partner at the time. And we put fifty thousand each. And I moved into the basement. We rent out the main floor and fast forward, we bought that in 2010 and fast forward twenty sixteen. We sold it for exactly one million dollars more. So and we both clear, you know, with our own equity back about one point one million dollars.

George El-Masri [00:12:07] Wow. And you didn't do anything to the property or did you renovate anything?

Sahil Jaggi [00:12:10] Not only that property. I mean, maybe we spent five to six thousand dollars for me to put a kitchen in the basement. It already came with a separate entrance and a bathroom, and the living condition was not the best or the basement. But you know what? I roughed it out. I like I said, I come from a very thick skin kind of background. So for me, like, you know, everything is, you know, like good. And how do you make the best of what you have? And I remember at the time we had a real estate agent that didn't give me that enough information that, hey, there's a land transfer taxes. There's. Yes, and there was a lot of miscommunication in that sense, though, I did not have the luxury to go and start spending money on fancy furniture, car, etc., this and that. So I was living in a mattress. I was going to work coming back, living in a mattress, going to the gym, doing my thing. Yeah. And that's how the first property came about. But what it did was it really sparked that interest in real estate for me. I enjoyed that process thoroughly. And from there I just couldn't stop myself, like, you know, every day after coming back from work, I spent three, four or five hours completely zoned out into Realtor Nazia looking at reports. And I found my passion. And from there I just, you know, from twenty ten, from twenty ten to twenty nineteen. Today, you know, I've known about 13 to 14 properties in Toronto, you know, worth over more than 14 million dollars, but loan to value less than 50 percent. Wow. And I've just done that through buying property myself with joint ventures in different ways.

George El-Masri [00:13:34] Very cool. So can you tell me about the second one that you got? Did you did you leverage the first property? Did you refinance or get a headlock on it? And then you moved on to the second,

Sahil Jaggi [00:13:43] so was a refinance. So as you know, twenty ten to twenty sixteen, you're on a plane, you throw a dart anywhere in one of the property increased. Yeah, right. So the way I judge an investor that is good or bad is that how much is being squeezed above market. I think that's one of the main things that you can tell my clients today. If the market is going up by 10 percent and you're going up by 10 percent, you're not that special. What you have to see is that if the market is going up by 10 percent, how is your property performed in comparison to the market? So I specifically picked a bungalow that came very close to the subway station. And obviously infrastructure in Toronto still sucks. Right. And so anything around that public transit to me is gold because because of such limited access and, you know, the there's not that many subway system compared to like New York, London or those places. Toronto still is getting there. So all the checklists that I still follow to date, all my fundamentals are very similar to that first property that I bought. Right. Um, so when I bought it in 2010, by 2011, you know, the property had already reached that 700 mark. That's how fast those properties were increasing. So I refinanced the money out. I also saved a bit of money and I took a little bit of a line of credit. And I purchased my second property, one hundred percent owned by myself. I still own it to this state. Also in the youngin Finch area, 50 foot bungalow with two different units. And we bought I bought it for sixty, OK, so I rented out both the upstairs and downstairs. It was enough to cover my line of credit, all that stuff included. And again, most of the properties that I purchased, I look at the rent ability and how the rents and the. Those areas as well, and, you know, being center of Tronto, close to the TDC, rents are always great and the property was, you know, it was a seller that was trying to sell it on property guys dot com. You didn't have representation? I didn't have representation. I just want wanted walked in. I said, I love this house, I want to buy it. I introduced a lawyer and we bought it, so I bought it at a pretty good price. I still own it and it's worth close to one point seven.

George El-Masri [00:15:38] That's awesome. Can you can you talk about the numbers a little bit because you bought it for 660, you rented top and bottom. So you must have been, what, like maybe forty four thousand forty five hundred a month in rent somewhere else

Sahil Jaggi [00:15:51] at the time. Keep in mind, the interest rates were a bit low. Yeah, I got the interest at two point two percent. OK, yeah. So I had about 20 percent down and with my numbers I think it was close to about thirty six hundred. OK, and upstairs I rented it for twenty four hundred and downstairs with three rooms that I rented for seven hundred each. OK so, so I was just to break even and I was just break even with maintenance here and there and yeah that was good enough for me because even to this day George, I'm not buying properties but trying to put five, six, seven hundred dollars in my pocket a month. To me what matters the most is how fast is my equity growing? I buy properties with a vision of accelerated equity growth as long as it's breaking, even with the 20 percent down model. Right. And that's what those that property was doing to me and even the first property that I purchased where I was living. So 20 percent down. As long as the cash flows are breaking, even I'm buying these property because I have five, six, ten reasons to say that this property is going to appreciate faster than market. Yeah, OK.

George El-Masri [00:16:53] Can you tell us a bit more about what you're working on today? So, yeah, like you were saying in 2010 and 2011, you're getting those properties for six hundred thousand. Obviously now you're saying one point seven, one point six and that kind of range bungalow. Yeah. 50 foot lot. Yeah. So, so what are you looking at today.

Sahil Jaggi [00:17:11] So, you know, fundamentally, I'm not looking at something that's not different because I don't believe in buying property at a very expensive price point. Right. As you said, the first thing that, you know, y y you tell a lot of people are a lot of people say that you shouldn't buy property in Toronto because it's expensive to me. I see value to me. I see appreciation. And that also has to come with the right starting point. I have never purchased a property with the exception of my principal residence where I live today of anything more than eight hundred thousand. My purchase price point has always been less than eight hundred. But what I do is after an area has saturated and how I determine that saturated is very simple. If you put 20 percent down and the rents are not covering your cash break even point and you surpass that. So for example, of North York has surpassed that one million dollars and the 20 percent down, you're not breaking even. That means the market is now attracting a lot more end users and people are paying emotionally. So what I do is I switch the area. So from 2010 to 2013, I was buying in North York, but in 13, I realized the price points crossed the one million and I switched into different areas like the East End. I went into the Gulf Coast area, but the fundamentals remain the same. I was still buying small bungalows and bigger pieces of what I was still buying properties that were logistically about 20 to 30 minutes from downtown Toronto, which with public transit or highway, I just went from north to a bit east, but the distance through downtown always remained the same. Yeah. So from 2013 to 2015, I was buying properties in the East End when the properties on the East End also surpassed that 800 when I was buying it from five hundred to me, it's time to switch again. As an investor, you have to get out of your comfort zone and you have to switch the areas. But to me, fundamentals always have to stay the same. Yeah, right. That is the property rentable is a property a good distance from downtown where more than six hundred thousand jobs today are being supported, where tech industry is exploding and Toronto is what people know, not areas when somebody comes from China, Korea, South America, India, China, wherever they don't know places like Kollberg or Berry or such and such. They know Toronto. That's where they want to start. Right. The the dream is to live in the big city. So I think the Toronto still fundamentally supports that ongoing immigrant population coming in ongoing people wanting to live in the city. So as long as your commute and logistics are still good, I keep switching neighborhoods, but my purchase price always has to be one hundred and my cash flows have to break even. Yeah, and the asset class that I'm buying is always bungalow's and I can get into that. Why I usually always bungalow's.

George El-Masri [00:19:41] Yeah, we'll get into that. I just want to make a comment about why it's not that I advise people not to buy in Toronto, but I advise people not to buy in Toronto if it's negative cash flow. Yes. And I know a lot of people can't afford Toronto as well. Absolutely. So if you're getting into a condo where you're losing five or six hundred dollars a month and hoping that it's going to appreciate, then that's not that's not a sound investment strategy because the market can come down at some point and now you're putting money out of pocket for something that's not worth what you paid for it originally.

Sahil Jaggi [00:20:11] One hundred ten percent agree with you. Yeah. Yeah. So that's like, you know, and you're absolutely right. Today in twenty nineteen, you can safely say that most of the areas in Toronto are saturated and most of these condo prices that are like, you know, even the preconstruction, a lot of the preconstruction that selling is very expensive and doesn't make sense and doesn't make a sound investment compared to a lot of other areas. But I believe there are still very small pockets that you can still buy properties for about eight hundred. Eight hundred fifty. Yeah. And you can do well, but it's about you have to pick a lot carefully now. It's very difficult to pick and you have to work with the right people to pick that right investment.

George El-Masri [00:20:46] Yeah, I agree. There's even like certain certain areas right now, like Leslieville, for example, where you can pick up a semi or something for about eight hundred twenty five fifty. I need some work but yeah, I guess like it depends on what your strategy is exactly. A lot of people want to flip those properties because after a pair of values, one point four, one point three somewhere in that range. Right. So OK. So can you tell me which areas you're interested in now? And you also touched on Bungalow's. So if you want to tell us why why you pick bungalow's.

Sahil Jaggi [00:21:16] So the reason why I personally really like the possibility of buying a bungalow is and keep in mind, all bungalows that I purchased, they have to come with the finished separate entrance so that I have the ability to turn them into two units. Yeah, the second reason I buy a bungalow is, you know, in my opinion, detached market is still my heart fair and nobody can argue that it's a better asset class if you can get your hands on it. Bungalows obviously take out the premium of people paying expensive prices for just the house. I'm looking more for the land. And how do I cover my cash flow with what's on the land? Right. The second thing is there's three types of buyers. When you talk about equity growth, you talk, you come right back and say, what does that really mean? Equity, world equity growth means appreciation, which means if I buy something today for seven to eight hundred thousand, who is about to pay me one million dollars and two to three years? Right. That's your simple way of saying that I'm expecting this property to grow in equity. So there's three types of buyers in. Market end-user, there's investors and then there's builders. So bungalow's to me, and when I say builders, I'm talking about those flippers, those people who want to buy a property, tear it down and build up. I buy mainly houses and streets where most of these houses are built in the Second World War. Right. 1950s, whatever people walked in and baby boomers and whatnot. So they come as a lineup of a lot of these streets in prime locations. You will see bungalow, bungalow, bungalow, big house, bungalow, bungalow, bungalow, big house. So I look for that kind of trend as to like, where are where is that growth coming? Where is those bungalows being purchased by these builders? Also, because I want to add more target market when I'm there to sell, by taking that out, by taking the you know, by buying condos, townhouses or even semi's, in some case, you're completely eliminating the possibility of selling it to the builder. So to me, the property also has to be enough liquid liquid enough to say that if I want to sell this property, I want to have enough amount of buyers wanting to buy my property in two to three years. So that brings me right back to why I buy bungalows. And, you know, there's always that upside to improve. And second thing is, you know, Toronto is under a lot of pressure for supply and demand. There's a lot of demand, there's not enough supply, and we don't have enough more land. So the only choice the and there's already talk about prevention of government trying to change zoning laws, which means they're going to start allowing people to build more on existing land. So that ties into my strategy that if you have a small bungalow on a big piece of land and the government is constantly trying to change those outdated zoning bylaws, you know, that might end if you're sitting on a nice piece of bungalow and all of a sudden you have zoning to build a triplex. So fourplex, you have that amazing upside versus the other other types of asset classes. You add a little bit of a whim of the market. So that's why I buy bungalows.

George El-Masri [00:23:57] Yeah. And do you legally convert them into duplexes or triple Xs or. I'm not sure if that's what you typically would do or do you kind of just leave them?

Sahil Jaggi [00:24:06] It's a gray area, right? Like everybody is doing it. But you know what? I want to call out the city for that. I don't think it's up to the homeowners to changing a bungalow into a legal duplex is not a joke, especially in Toronto. I don't know how the zoning bylaws are in different cities, but you need to have 60 to 70 thousand dollars in your pocket at the least. And you have to like you might have to get out the entire house.

George El-Masri [00:24:29] And it takes a long time.

Sahil Jaggi [00:24:30] It takes a long time. Yeah. So and you're now putting money into a property that in the long run has to be torn down regardless. So now that I have the equity power also gotten into building custom homes already built two or three customers at that stage of flipping, I now building them brand new and selling them as two storey homes. So I don't feel that it's marked for me to like put that much money up front. So what I do is I try to sign one lease and I try to give the upstairs guy the the ability to sublet the basement. OK, that's what I do to get away from that legal standpoint. As long as I have one lease. And obviously you take all the precautions as you can as a landlord, you put fire rated doors, he put the smoke detectors, et cetera, et cetera. And you're not like stuffing five people in one room as long as you're taking the right precautions. I think it's ridiculous. The city wants us to start legalizing these basements and duplexes. They need to start making it a lot easier for landlords to do it. They can't expect people to spend one hundred thousand dollars on a small bungalow so they can tell their fire department that it's legal. It's ridiculous. It's a problem in our system.

George El-Masri [00:25:31] Yeah, OK, fair enough. And another benefit of a bungalow, I guess, is the large basement. So if you are renting it, it's a lot bigger than most detached homes that are two stories that it's going to be smaller, naturally. Yeah, the great basements.

Sahil Jaggi [00:25:44] So you put a kitchen out there with two basements and you know, you have tons of people looking for I mean, look at the rents, right? If you're trying to rent a basement for like fifteen to sixteen hundred dollars, you have enough people ready to pay that amount because they have to be in that location because they're working downtown or somewhere in that area where I bought the property and they don't have the ability to go and buy twenty four hundred dollars for a one bedroom.

George El-Masri [00:26:03] Yeah. So. So it's fifteen to sixteen hundred right now. You're getting just

Sahil Jaggi [00:26:06] about oh I'm starting to get fifteen or sixteen hundred. The last property that I just put that I purchased and it's closing in November twenty six. We're actually turning it into three bedroom basement apartment, three bedrooms downstairs, three bedroom. So I'm expecting as much as eight hundred. Yeah. In the basement. That's great. So it's almost, you know, twenty four upstairs. Eighteen downstairs. That's, that's good. It's forty two hundred and a rental income.

George El-Masri [00:26:25] I don't know if you're going to believe this, but in Hamilton people are getting somewhere around fifteen hundred a month for basements now.

Sahil Jaggi [00:26:32] I believe it, yeah, and you know why they're getting it, because it's a lot more demographics of people that are only have the luxury of paying less than two grand. They don't have the ability to pay more than to rent. So unfortunately for them, they can't they don't have the luxury to go and rent main floors and still have a big family. So they're like, OK, you know what, we'll pay seventeen to eighteen hundred dollars or even six hundred dollars and we can get a basement and put our two kids there and have enough two or three bedrooms. So it makes

George El-Masri [00:26:56] sense, right. Yeah, that's a good point actually. All right. So what are you which what are you doing today. Like what are what's your main focus today. Are you. You said you're building custom homes. Are you also doing flips or are you acquiring more with joint venture partners? What are you working on?

Sahil Jaggi [00:27:13] So I'm wearing a lot of hats, right. Simply in my office, like, you know, based on the fact that I've done pretty well in my portfolio and my equity growth has always beaten the market by double digits. There's a lot of people that reach out to me and say Sölvi want to do the same thing. And in twenty fourteen, when I go to my real estate license, nine out of 10 people that walk into my office that I end up working with are all investors. So that's like right up my alley. So I'm swamped with a lot of investors and thankfully I have tons of amazing clients that are in the business of building portfolios. So I'm providing them with consulting and providing them with real estate real estate advice. And I'm always open to taking more clients and working with people who are looking for investments specifically in Toronto. Uh, I'm also now applying for two permits for the job. So what I do is my strategy is never to buy and flip. My strategy is always buy, hold, make sure the area that I've purchased and right ripens to the point that I think that it's now hitting that saturation level. And I can give you a live example, one of those in a bit. So I'm building a lot of custom homes for the properties that I purchased back in 2014 and 2015. They're now coming back into my roster to build because usually I'll buy hold for four or five years and then build. So whatever I purchased back in 2012, 2013, 2014, I'm building today

George El-Masri [00:28:27] we demolishing and

Sahil Jaggi [00:28:29] exactly demolishing and rebuilding. And in some cases I'm putting an extra storey on top, but there are being sold as luxury homes. OK, cool. So doing that, I also have started a real estate fund between me and five other investors in which I'm the managing partner and we are buying a lot of commercial mixed-use properties in Toronto and between 14 properties and the commercial properties. I'm solely property manager in charge of more than five hundred thousand dollars in rental income a year or so between me and my assistant. We do property management, we're building houses, we're helping people buy investment properties and more. So the main focus is I am constantly in the hunt for buying houses. And in the last one or two years when property just slow down versus twenty sixteen in twenty seventeen, I want a buying spree.

George El-Masri [00:29:13] Mhm. Very cool. You talked about your, your portfolio being at somewhere around 50 percent loan to value. Yes. Um so that means that are you, you must be cash flowing a little bit. Yes. Now I'm starting to you're starting to cash for a little bit. Are you using that cash flow to fund your life or are you generating income through selling real estate.

Sahil Jaggi [00:29:32] So my main way of generating income is my day job, which is that I work with clients to to sell them real estate. And in the last four years, I've sold more than a hundred million dollars in real estate. So I have a Hall of Fame Remax, top 30 under 30, constantly hitting chairman and platinum and so and all with buying investment real estate. Right. So I'm not into like, you know, maybe selling property as much as, you know, helping people buy. Yeah. So a very specific niche just by doing that. Got it. That's my day job. So I'm not letting these properties feed me. What I'm doing is I'm refinancing. So what I when I buy something for 80 percent loan to value and equity appreciation is fast. When my loan to value starts hitting that fifty percent on each property, I bring it up to sixty five or 70 percent. I refinance and I use it to buy my next property. But my goal is that I never refinance a property and start taking a loan to values some more than sixty five percent. And I think that's important to stay conservative and to stay a risk averse. Yeah. Because there is a there's always that chance in real estate that if government intervenes and starts putting certain rules, you know, you need to have enough room to breathe with your equity. So I am very conservative and keeping my loan to value. And as long as I'm refinancing and my loan to value stays at sixty five percent. And you know what, when I get that sixty five percent with a decent interest rate, uh, my cash flow, especially with the fact that rents have gone up thirty three percent, as long as you're turning over your, your, your tenants, your cash positive. So all the tenants that I've turned over in the last one or two years and I've refinanced back to sixty five percent, I'm cash positive. So I would say about six to seven properties that I owned today are all cash positive.

George El-Masri [00:31:12] Got it. How often are you reviewing your your spreadsheets to to see what your loan to value is and that kind of information.

Sahil Jaggi [00:31:19] Every month or so I will go back to the chart and I'll see how everything is doing and what property can take some money out. Is there a possibility to increase rents on some tenants or increase like add a story, maybe some rentals if. Needed and you know what, because I'm very property management hands on, it doesn't slip away from my hands. I know exactly what each tenant is, how many doors, what they're charging when their lease expires. I have everything very nicely organized. And the reason why I've never outsourced property management so far is because it's that hands. That's not the reason I don't I haven't invested in property that's too far away yet. So I have a full time person that works in the end between me and her. We hash out all the property management.

George El-Masri [00:32:01] So do you have a spreadsheet that has all of that information in it? Every lease, expiration dates, every lease amounts, and all of your properties are in one spreadsheet? Everything. Yeah, you don't use like software for that.

Sahil Jaggi [00:32:13] The only thing I do is that there are certain properties that are purchased under my personal name, certain properties I having a joint venture to certain properties. I have a corporation holding Corp. so I have different tabs for each, but I do have a spreadsheet that shows my entire portfolio.

George El-Masri [00:32:25] Got it. Yeah. OK, um, so your your joint venture stuff, can you talk a little bit about that, how you were able to start off in joint ventures. And also another question I have is you seem to have a really good structure in your business, like you have everything organized. You know what you should be doing, what you shouldn't be doing, loan to value all of that. Where does that come from? Is that something that you just figure it out on your own or did you have a mentor or did you have a group that you were attending where you learn this kind of stuff?

Sahil Jaggi [00:32:55] I know books, no mentors. This is just all reports and all learning from my mistakes. Right. A lot of people today have the luxury to listen to a podcast, meet with experts. I think in two thousand, like ten or eleven, I was very lost. But I guess coming from the economics and finance background, I think fundamentals started coming into play when I started. But a lot of the stuff initially was, you know, it was it was all over. I don't really know what loan to value is, but when you start talking to mortgage agents and they start telling you what loan to value is. So I learned a lot as I went along. Right. So I don't really have a particular book that I can tell you that, you know, read this and you learn. I think the best way today to learn about real estate is to do exactly this is to learn, listen to podcasts, meet experts. Even today, if I see an article about somebody like for example, I stumble upon your podcast, I'm like, you know, I want to meet you. I don't shy away from meeting people in real estate. They're not teaching the stuff in universities. I think there's a huge gap between what they teach people in universities and what they expect you to do successfully in business. So I reach out to people. I talk to people. I didn't have a specific mentor, but I've always been able to joint ventures. And I guess a lot of that is just common business. Uh, common sense. Right. Like, I like I said, I've always been about sales. I've always been on meeting people. I've always been about learning more and more. And if you're spending a lot of your time doing something that you love, you just constantly are learning every day. And as you must know, like real estate is a big spectrum. There's so much to do, so much to learn. So and it's a business that also attracts a lot of synergy if you do it right. And that brings me back to joint ventures. Right. So the biggest thing about joint venture is that, number one, are your goals aligned? If they're not, don't try to force it. You have to work with people that your goals are aligned with and put it down on paper. Don't do these handshake deals. I think we're past that point. We have to put everything down on paper, like I even own property with the one of my best friends. But I was eight page partnership agreement and a trust agreement with a lawyer. Yeah, but you have to be because it avoids trouble in the future. Joint Ventures is one of the best ways to grow in real estate and the best way to mitigate your risk and take benefit. But you have to do it right. And I would again suggest working with people that know what they're doing in joint ventures and, uh, you know, understand the difference between the difference between exports to. Right. And I can tell you a lot about that. Too late. But social media, um, there's a huge difference between good being good at digital marketing and social media and being actually go to real estate. Yeah. So you have to pick people who have actually done this, executed this, felt how they felt while doing it and are able to understand what you're doing. That's what you separate an expert from a person who's really good at like, you know, uh, I don't know, graphic designing.

George El-Masri [00:35:41] Yeah, right. Right.

Sahil Jaggi [00:35:43] A big difference. Yeah. And I think that applies to every industry. Right. It's a lot of wrong perceptions out there. There's a lot of like people claiming to be experts. And, you know, you sit down with them like, look, what do you own? And it's like nothing. And it's like, how are you an expert then? Yeah. Right.

George El-Masri [00:35:57] Yeah, yeah. We kind of we're talking about this a little bit. I think you were going to mention some of the areas that you find interesting now in Toronto there, where there is a potential to, um, see some capital appreciation, obviously the whole city is going to appreciate. But which pockets are you interested in?

Sahil Jaggi [00:36:14] I think there's a lot of saturated areas and anything at all young street that I think is just game over now. Like unless you're buying it for your own end user purposes, I wouldn't even look at unless you're, you know, you're parceling land or anything like that for any huge projects, for an entry level person, he's got to stay away from the site. Raided areas and the best way to find those areas is to. How so, for example, if you buy a bungalow in young and French, let's say we are taking apples to apples comparison, the same size bungalow, same size land in young and French, one point four to one point six million, same bungalow in beaches or any of those area. One point one to one point three million. Yeah, same bungalow. Now you come into the rest area, maybe you're looking at nine hundred to one point one million and then you look at the rents that these guys are comparing and rents almost the same. Yeah. So that should tell you stuff like that. So Bloor West is one of the good areas that I like. There is you know, there's another area which is not Toronto. It's right east of Port Credit. It's called Lakeview, one of my favorite areas. I think it's very up and coming right off the of right off the go train station. And then there's tons of there is a Mimiko is one of my favorite areas right now. I think it's a fantastic logistics. You know, I purchased properties in 06 before a lot of my clients. I'm driving people there and, you know, but it's not just enough to talk about the areas. It's also about streets, what kind of house, what it's facing. Is there an apartment building behind you? And that brings me back to if you shorten and if you narrow down an area, try to find a person who's really an expert at that area and start working with them.

George El-Masri [00:37:45] That's what I think is really cool about doing a podcast. I get to meet so many different people that are doing different things. Yes. And your way of building wealth has worked well for you. And there is there's dozens and dozens of other ways. So it's really cool to hear how how you've done it and just the fact that you're able to do it in Toronto with very little no help from parents or anything. I think that's it's a really cool story to share. And I'm glad you're sharing it.

Sahil Jaggi [00:38:09] Thank you so much. And, uh, yeah, and that's that's the beauty. You meet so many experts. You listen to the stories like, wow. But you know what? It's hard for the and it's hard for the listeners or, you know, just the regular people because there is so much advice. Yeah. It's like, how do you pick the right one? Exactly. So I would say, like I said, sit down with multiple people but decide once who you want to work with and then stick to that person and trust that person's expertize. Right? Yeah. And I don't like putting myself out there as a jack of all trades. Yeah. And I don't go out there and say partner with me. For me it's like partner with a person that aligns with your goals. Yeah. I don't think my goals are your goals yet. Maybe they are, maybe they're not. But that has to be in a conversation. Um, I don't go around telling people that I'm an expert. OK, ok. Well I'm an expert at Waterloo Golf. I don't do that. I have specific people that I work with as a referral. So, for example, if people come to me and we find out that their ability to do a purchasing power is not there to buy in Toronto, my next thing would be, look, I've heard amazing things about Hamilton, heard amazing things about this. And this person knows what he's doing in Hamilton. And I pick the right person and I just refer the client, because if you start doing everything and you're an expert in everything, you're just going to be nothing right at the end of the day. So I specifically focus on my area of expertize I've done well in my area of expertize. And I take a, you know, a bunch of investors with me there. So it becomes an easy sale to write because they trust you because they're like, if it's so good, why don't you buy it yourself? And it's like I put my money where my mouth is. Yeah. And that's the interesting thing about a lot of these preconstruction agents where they're like just selling and selling and selling and they don't buy a single unit in these, you know, these quote unquote, amazing investors. Yeah. So I don't believe in that. Right. Especially I think there's a huge amount of misconception. And I'm not I don't mean to be controversial on your podcast, but there's a huge amount of misinformation in the market buy by real estate investors, real estate agents that are just spoiling it, just like they're calling everything a good investment. And meanwhile, they don't own a single unit in these preconstruction units.

George El-Masri [00:40:09] Yeah, I would probably agree with you on on the preconstruction. I think there is there's certain quotas that they have to hit and there is pressure from builders because they allocate units to agents. And if you don't meet your quota, if you don't sell the units that they allocate to you on the next project, you're not going to get any. Exactly. So some of these agents, they kind of don't care if it's a good investment or not. They just want to sell the units. Exactly.

Sahil Jaggi [00:40:32] So it becomes a little difficult for the owners. And that's why there's so much mistrust in our industry. Right. People don't trust real estate agents because apparently everything is good.

George El-Masri [00:40:41] Some some people. Yeah, yeah. Some people don't trust.

Sahil Jaggi [00:40:43] But there are some amazing people out there that know what they're doing, like even to sit down and have a conversation with and you pick up things like this tells me, you know, everything about real estate. There is to know. But you'll be surprised how many people you can sit like this with. And they have no clue what you're talking about.

George El-Masri [00:40:57] Right, right. Yeah. Well, there's tons to learn. Exactly. But one thing I was going to say about like being an expert, I totally agree with you. And this is kind of like a far off sort of comparison. But when I work out in the morning, I like to shoot a lot of baskets, basketball, and sometimes I'll just observe people. And then there is this one guy I see every morning he's there. He shoots like ninety percent from the three point line, does the same thing over and over corner shot, corner shot doesn't do anything else. And then you look at some of the other people that are there, they're working on all these different move step backs, trying to do like NBA player. Amazing analogy. Yeah. And they miss 90 percent of them. So it's the total opposite. So one guy is just doing the same thing over and over expert, other people are trying everything. So I said exactly that. Yeah, little different. Yeah. So let's jump in to the next section, which is a random five. I'll ask you five random questions and just answer the first thing that comes to mind. The first thing is what is something you learned in the last week?

Sahil Jaggi [00:41:54] Um. How important it is to work with the right contractors. OK? And it's not always about the cheapest guy, right? It's it's about and I think that applies to a lot of the a lot of different industries. Stop trying to price out jobs all the time. Pick the right person. And even if he's taking a little bit of a premium, make him part of your team. And I've learned that the hard way because I'm still new to doing construction. It's my third project. And my mistake was that I was trying to price our jobs and lower my costs all the time. But I've been burned by a lot of contractors and I've been through it and I've learned that the hard way. So pick the right contractors. There's a lot of information and reviews about people out there. And even if they're tad more than people, that doesn't come with much of a history work with that person.

George El-Masri [00:42:41] Cool. That's good advice. If you had the world's attention for 30 seconds, what would you say?

Sahil Jaggi [00:42:47] I would go right back into? I think at this point, I'm really passionate about talking about, you know, experts in their industry versus experts in their industry on social media. OK, I've taken this very personally because I've seen a lot of misinformation out there and it angers me. So be careful. No matter if you're in the fitness industry, no matter if you're in like any industry at all, learn how to pick people. And I would just make a 30 second segment about, you know, calling out people that are just very, very all about like, you know, graphic design, this and that and be an expert at what you are and let get the quality work, not just try to like, you know, be the expert without being the expert. And I think it's a sad truth of our sales industry. Right. OK, fair enough.

George El-Masri [00:43:29] That makes sense. Yeah. What success principles do you live by? Or maybe just one success principle that you live by.

Sahil Jaggi [00:43:36] Always have a short term and long term goals aligned. If your short term goals are not going to be aligned with your long term goals, you're always going to be working in a zigzag. Right? So where I see myself, where I want to see myself the next five to 10 years, I'm working on that in the next three weeks. Right. Everything has to line up and always be aware of the goals. And of course, as you move forward, and especially in real estate markets change really fast, you have to shift your goals. But keep in mind that you're always think of your long term goals and align them with your short term goals.

George El-Masri [00:44:03] Perfect. That's good advice to what's in your fridge right now.

Sahil Jaggi [00:44:07] Uh, beer. Uh, you know what? I just ordered a bunch of good food stuff the first time. I've never tried a meal prep before. Yeah, but I just ordered a bunch of stuff and it just sitting in my fridge and I have nothing else I'm a single guy out on right now. So it looks exactly how you would think it would look like

George El-Masri [00:44:26] living in, uh, one point seven dollars million

Sahil Jaggi [00:44:28] home. Yeah, on the lake. In a bungalow. Yeah. And eventually, you know, when I, when I, when I need bigger space, I'll build and that's my home. Yeah. But yeah, my fridge is pretty lame right now.

George El-Masri [00:44:38] OK, fair enough. If you could invent one thing, what would it be.

Sahil Jaggi [00:44:43] Uh well um. Coffee, because I guess I'm addicted to now.

George El-Masri [00:44:50] Yeah, that's a good one. That's a good answer. OK.

Sahil Jaggi [00:44:54] The fact that, you know, it's there for you to drink. Yeah.

George El-Masri [00:44:56] You know, I just started drinking coffee. Oh, God. I went. I want to

Sahil Jaggi [00:45:00] run far away.

George El-Masri [00:45:03] It doesn't leave. Yeah, I know. It's kind of it's hard to once you start, but. Yeah. OK, so that's good. So I think that's it. Do you want to share how people can reach you and what you might want them to, to reach out to you about.

Sahil Jaggi [00:45:16] Absolutely. If you're a person that's looking for investments in Toronto, if you're looking at just general real estate advice, happy and always, always welcome more people to come in. You know, I always have time to meet with people that are looking for investors. And even if you're looking for a home, but you want it to be a good investment in Toronto, I help tons of people like that to reach out and buy. You know, even if you just Google me, you'll see tons of different platforms that I'm on. My Instagram is mink real estate. One word and you don't just mean cruelty dossiers, my website and always welcoming people that are wanting to know more about real estate.

George El-Masri [00:45:53] Cool. Do you have any final words that you'd like to share before we end things?

Sahil Jaggi [00:45:59] No, just, you know, just keep at it. If there's, you know, in real estate, there are going to be a lot of people that will tell you that you can get financing any more. You can do this anymore that any anymore. There's always a way and there's live examples to prove that. Right. Like your income's always going to get topped out by your appetite. Right. So you always have to look for smart ways. You have to, you know, don't be afraid to joint venture. As long as you're careful, you're doing the right things. So there is always a way to get into real estate. As long as you partner with the right people and work with the right people. And if you're in constant search for that with a no give up attitude, I think you'll get there. And I'm the life example of that. Like I said, I mean, people how you have all these scary articles, don't let them scare you as long as they're fundamentally correct and you're meeting the right people and you're not stopping to want what you want. I think there's always a way. Cool.

George El-Masri [00:46:46] Sounds good. Well, thank you very much for your time. It was nice chatting with you. And I wish you the best moving forward and

Sahil Jaggi [00:46:51] looking forward to seeing it. Yeah. My pleasure, George. Thanks for having me.

George El-Masri [00:46:54] Thanks for listening to this episode, I hope you enjoyed the content and as a valued listener, I'm giving away a sample letter of intent. This letter is used once your potential CO venture expresses interest in working with you. It outlines the general structure of the deal and intentions of both parties. You could visit w w w well off dossie forward slash letter to receive your free copy w w w well off dossie forward slash letter.

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