Table of Contents
Dave Dubeau [00:00:09] Hey, everyone, this is Dave Dubeau with another episode of the property Profits Real Estate podcast today, zooming in all across this wide country from our nation’s capital. My buddy Francois Lanthier Francois, how are you doing today?
Francois Lanthier [00:00:24] I’m excellent in you.
Dave Dubeau [00:00:26] I am fantastic. I’m fantastic. All the better for having a chat with you. And I have the pleasure of being interviewed by you and your lovely wife a little while ago on your fantastic podcast that as a sharp young guy that I want to talk to and really find out more about what you’re doing with real estate investing because you kind of got an interesting twist on it. You’re in Ottawa, but a lot of your properties are not in Ottawa. So let’s start first things first, Francois. What got you into the whole real estate investing game in the first place?
Francois Lanthier [00:01:01] Yes. So there’s many reasons why. But first of all, my parents were investors themselves, and they owned the hotel and my mom always said, Oh, we should buy rental apartments, and they never did. My dad is now gone. But anyway, I’m kind of continuing that dream, and my mom was actually my first tenant, so she kind of proved her case. And the reason is you didn’t
Dave Dubeau [00:01:24] have to evict her. I’m hoping you didn’t after a video. Don’t grow ops. Nothing like that.
Francois Lanthier [00:01:30] Now that would be her generation, though, but no, no pot and things like that. I did that when I was younger. It’s over now, but I did end up selling the condo where she was living anyway. Long story, but she did inspire me and inspire us because she had a house that she kept. But she lent it to my brothers like, I don’t need this big house anymore. I want to rent and I want to become a tenant and maybe you could buy a condo. And anyway, it was good for me. It gave me an easy start. Yeah. And in Canada, as you know, you’re Canadian as well, it’s hard to live on even to wages like two really good wages. The cost of living is so high with kids and activities and things. So you need as have
Dave Dubeau [00:02:15] you guys like your wine. So suspect you like the expensive stuff.
Francois Lanthier [00:02:18] There you go. Yes, someone who is there right now, I’m enjoying, and that’s why I’m blushing. That does add up, but it’s not the wine. The drinking is a side effect, but it’s really you need extra income and a side hustle. And after working 40 hours, 50 hours and commuting, you don’t have much time. So what can I do that’s going to generate some income without huge efforts and spending another 40 hours working real estate? So if you have systems in place and if you do like me, you buy remotely so somewhere far where you can’t go. I’m a bit of a control freak, so if it’s local, I’ll end up going there and mowing the lawn myself. It’s too far. There’s no way I’m going to do that. So and I just thought, OK, that’s going to bring in some extra revenue and create a retirement plan at some point because I’ve always worked in the private sector. So no retirement fund, no pension, you’re on your own. So that’s kind of why I did it smart.
Dave Dubeau [00:03:17] All right. So your mom inspired your parents inspired you. Your mom was your first tenant. You bought her condo and now worked so well, and now you’re kind of investing remotely. How did you how did you make that leap? Because I doubt it was just one thing that you said, Hey, you know, I’m a control freak. I don’t want to be dealing with tenants and toilets locally, so I’ll go buy something far away. How did that actually happen for you, Francois?
Francois Lanthier [00:03:41] There was a process, so my mom lived two streets over from me, so that was her place. That was really close. And of course, she had me wrapped around her finger. I was shoveling her balcony in winter and watering her plants, and it just went on and on and I’m like, Well, I’m taking care of my place, not making any money, but whatever it’s appreciating. And then I looked outside, and now we’re away. What can I afford? So something inexpensive that brings in some revenue, right? So I bought there and I’m like, Well, I can go once a quarter and hire out for whatever I need. And then again, the market got kind of tapped out. Ontario being red hot, everything was being too expensive. I was priced out, so I started looking out east and
Dave Dubeau [00:04:26] then being out east. Being where in the Maritimes?
Francois Lanthier [00:04:29] Yeah. So Moncton, New Brunswick’s amazing city add or so much going on for Moncton. I’ve only been once in my life and I bought several properties there and the cash flow tremendously and you can do some really great stuff. So that’s it.
Dave Dubeau [00:04:47] So what kind of properties do you have in Moncton? Are they single-family homes or small Maltese or Swedish properties? But what are you up?
Francois Lanthier [00:04:53] so small multifamily? So the first one I bought was a five blacks and I also I got a six plex, a few duplexes. What else? A triplex for Plex. So a whole everything six and under because I find it’s manageable. And I’m ready for a larger but I just need more money, so that’s another.
Dave Dubeau [00:05:13] Well, that brings up a good point. So those that’s a quite a nice little portfolio that you got created so far. How did you did you save up for down payments yourself? Did you qualify for all those mortgages? Did you work with investor partners for some of those deals? How did you get? How did you build up that portfolio? Sounds like you did it fairly quickly.
Francois Lanthier [00:05:33] Yeah. So within about a year and a half. So I have more. I have some in the states now and other places, Ottawa. But what I did, it’s a variety of things and many of them, thanks to you. So to your course that my wife and I attended in March of 2020. So during that one, the early pandemic and we just learned about using OPM and how like you get investors and how to raise capital. So that’s one strategy we used and it’s been excellent and it continues to this day with podcasts and social media email marketing to a very small extent. I would like to do more in the future and also joint ventures. So we’ve done a lot of joint ventures, found partners and some of them became money partners, and many partners became joint venture partners.
Dave Dubeau [00:06:23] So it’s like, what’s your definition of joint venture partner?
Francois Lanthier [00:06:27] So with someone that comes in with the credits and the money, and then I’m the working partners, I find the deal, I structure the deal. I look after the property management hired out, of course, because I’m too far to do it, but I hire someone and you have to manage them. And that’s kind of my JV. I know it can go a million different ways, but that’s
Dave Dubeau [00:06:48] just curious how you do it. Very good.
Francois Lanthier [00:06:50] Very traditional.
Dave Dubeau [00:06:52] That’s a fascinating idea. Hold that thought for a second. Hi, there. This is Dave Dubeau and real estate investors hire me to raise capital the right way. Why? Because most of them are stuck with too small of a portfolio, and they don’t know how to attract investors and raise money for their deals. So I help them to connect, capture and close their ideal money partners. Bottom line when you’ve got a deal, you’re going to have the capital to do it, so go ahead and book a no cost capital clarity session with me at Book a chat with Dave dot com. Again, that’s book I chat with Dave dot com. Awesome, Francois. So, yeah, so you took the whole concept of other people’s money and ran with it. And so, yeah, you got into Moncton in a big way. And now you say you’re also doing some invest in the states. Now you’re Canadian and you’re investing in the states. Are you working with JV partners or money partners to do those deals as well?
Francois Lanthier [00:07:46] Yes. So I took it one step further. So some of my American deals are really I think it’s wild. So some of them, what I did is I got a partner to finance the deal. So I’m a partner, their working partner. My partner has no money either, but he’s got high incomes. So every month, every week he gets a big paycheck, right? And so I found that private lender to lend us the money, and my JV partner pays the interest on that money and for a share in the deal. So I’m putting in this much money in the deal, and it’s just amazing. It’s a great way to finance deals, and
Dave Dubeau [00:08:25] I love these kind of creative things. So what kind of a property is out in the states that you that you purchased this way as a single family over a small multi?
Francois Lanthier [00:08:33] Yes. So for now, I started quite small. It’s a single family home just because of the market. So it’s in Detroit, Michigan and in Detroit. The rentals are better in single family homes for now. Multifamily from what I’ve seen is not so great. I would look at different states for that more Texas or Nevada.
Dave Dubeau [00:08:53] Okay, so Detroit, you brought a single family home with your investor was the hard money lender, an American lender or Canadian lender
Francois Lanthier [00:09:01] Canadian, which does create some complication. But the exchange rate is actually fairly good right now, so it’s not bad.
Dave Dubeau [00:09:09] Yeah, yeah. Okay, very cool. So you basically went in all cash, bought the property, all cash and you’re taking care of you found the deal, you found the management, you’re taking care of all that stuff. Your money partner brought his credit to the table, so the hard money lender was comfortable loaning. So how’s the hard money and lender secured? Is it on that particular property or is that a promise every note? Or is that a different piece of property of houses, money secured or money secured?
Francois Lanthier [00:09:40] Yes, it’s promissory notes on properties that I own in Canada.
Dave Dubeau [00:09:44] So creative.
Francois Lanthier [00:09:46] Yeah, that’s it. Everything’s on the Canadian side, promissory notes. I buy it there and it’s a birth. So out there, about six months or so, all the money is coming back. And now my partner and I, we have a free property that reported zero bargain.
Dave Dubeau [00:10:01] You’ll pay out, you’ll pay out your hard money lender. Your joint venture partner just qualified for that loan and has paid the interest in the meantime. Yes, and you’ve gotten all the all the work done and babysat the whole thing. You’re going to refinance it and you’re going to get to put it. But basically, you’re not going to refinance, you’re going to put a mortgage on it in the states with an American bank, I’m assuming. Yes, very, very cool. I’m sorry. I keep picking your brain around this, but I find it fascinating because again, this is a big thing hurdle a lot of Canadians have about investing in the states is OK. Well, what about? What about liability, what about corporate structure, what about double taxation? Now I know you’re very well connected and you’ve got your own podcast and you’re rocking and rolling that way. But can you give us a big, broad strokes about how you’ve set things up so that hopefully you are getting whacked with taxes in the states and in Canada and how that’s going to work for you and your investor brother?
Francois Lanthier [00:11:03] Yes, absolutely. So again, with proper planning, and that’s something I did learn from other podcasts and then consulting as well. So do your due diligence. But my tax lawyer in the states advised me to create two corporations. So a limited partnership and LP and an LLC. So a C Corp. And that way you’re able to pay tax only just like in Canada. So after all, expenses and depreciation and all that stuff, and then whatever is left comes to Canada. And then if it’s taxed at all, it’s taxed at the Canadian rate. So let’s say you paid 20 percent in the states and here you should pay twenty five, then you only pay that five percent difference. So or whatever it is, it depends. I have multiple corporations in Canada, so my accountant will tell me at the end of the year where it goes. I’m not too sure you have, but it’s going to be quite minimal, especially at the beginning, because you have all these expenses, closing costs and things, interest. All that interest is going to be really good for me in this case. So it’s all proper strategy and again, planning. So that’s a big thing. If you plan on moving to the states, which I don’t but some people do, then the planning needs to be very different because taxation, there’s some advantages if you’re American or like on a visa of some kind, but you need to plan accordingly as well.
Dave Dubeau [00:12:24] Yeah, and most definitely that’s. Something else I want to ask you regarding that, so for your JV partner, is he also part of the corporate structure in the states or is it just kind of a side deal with him?
Francois Lanthier [00:12:39] Yes, no, no, so I made him a director in my company, and we’re going to buy a few properties where
Dave Dubeau [00:12:45] I was going to say 12. Sounds like it probably makes more sense to do multiple properties. So basically, you’re going to keep doing rinse and repeat that process
Francois Lanthier [00:12:54] until I’m fed up and I buy a helicopter and I fly away. That’s when I’m going to stop.
Dave Dubeau [00:13:00] I just met with this particular strategy with this particular JV partner.
Francois Lanthier [00:13:04] Yes.
Dave Dubeau [00:13:06] Very, very cool. Well, Francois, which is absolutely fascinating stuff. It’s obvious that you’re a sharp cookie and you’ve got a lot on the ball. You and your lovely wife, if our listeners want to find out a little bit more about you and you and listen to your podcast and perhaps connect with you. What should they do?
Francois Lanthier [00:13:24] Yes, so many things. First of all, we’re quite active on Instagram, so f l underscore homes underscore corp so f l for family last year, which means lots of family. That’s our family because it’s a family affair with my kids and everything. And also, yeah, you can find me on the right club dot com and the forums and the chats. That’s a great way. You can send me an email. So L Homes Corp at gmail.com. And also just so before we forget here, I did retire at age 40. So that’s another reason why I did all of this and my wife is joining me. She’s going to be asking to be 40 when she retires as well. So in a few weeks.
Dave Dubeau [00:14:05] Wow, congratulations. That is absolutely fantastic. Francois, it’s always a pleasure. Thank you very much for your time and love to circle back and check in on how things worked with that. That U.S. deal, once you’ve got it all burn out and you’re on to the next one, I think that’s absolutely fascinating.
Francois Lanthier [00:14:22] Yes, I’d love to give you an update. Thank you.
Dave Dubeau [00:14:25] All right, everybody. Take care and we’ll see you on the next episode. Cheers. Well, hey there. Thanks for tuning into the property Profits podcast if you like this episode. That’s great. Please go ahead and subscribe on iTunes. Give us a good review. That’d be awesome. I appreciate that. And if you’re looking to attract investors and raise capital for your deals, that may invite you to get a complimentary copy of my newest book Right Back There. There it is the money partner formula. You’ve got a PDF version, an investor attraction book dot com again investor attraction, book dot com. Take care.