This is a true story!

As promised in my previous article, I’m about to reveal the real numbers behind the curtain of real estate investing. When I say “behind the curtain,” I don’t mean the information is hidden—it’s there for anyone who’s willing to dig deeper. However, many people overlook these numbers. Why? Often because they’re too skeptical to explore them or too focused on their immediate financial struggles to consider investment as an option for improving their situation.

There are also successful real estate investors who don’t feel the need to boast about their achievements. Why? Because they don't need to prove anything, and most importantly, they don’t care about convincing skeptics or those who aren’t willing to listen. They understand how to build wealth in real estate, and they are content to quietly enjoy the financial rewards of their investments.

In this article, I’ll show you the true value of real estate investment. Through my own experience, I’ll demonstrate how making the right decisions (and avoiding mistakes) can turn into substantial wealth. By the end, you’ll see how seemingly small, overlooked opportunities can result in massive financial gains over time. Let’s take a look at the numbers, and I’ll show just how much you could be missing by sitting on the sidelines.

I started investing in real estate back in 2014. After spending three years in the U.S., I returned to Canada. I had lived in a charming town in Virginia, nestled in the Appalachian Valley. Real estate prices were incredibly low there—around $150,000 for a detached house—while the rent was about $1,600 a month. This made the gross rental yield 12.8%, which was an attractive number for any investor.
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​Gross rental yield is a straightforward metric that gives a quick snapshot of a property's income-generating potential. It's calculated by dividing the annual rental income by the property's purchase price, then multiplying by 100 to get the percentage.

For example, if a property costs $200,000 and generates $20,000 in annual rent: Gross Rental Yield = ($20,000 / $200,000) x 100 = 10%

The higher the gross rental yield, the better the investment opportunity.

In Virginia, I had gotten used to these impressive numbers. But when I returned to Canada, real estate prices were much higher, and the gross rental yield was much lower. The “magic formula” of a 10% yield didn’t apply in the Canadian market. In fact, most investors are happy with yields of 10%.

At the time, I didn’t have much experience in real estate investing, but I had read numerous books and was eager to try. With a modest budget of $50,000, I decided to find a distressed property in the U.S., renovate it, and rent it out. I believed this would be a low-risk way to test my wealth-building idea. So, I proceeded with the plan.

After researching various options, I chose Atlanta, Georgia, as my investment location. There were plenty of distressed properties with good rental potential. I found a wholesaler and bought a duplex for $45,000 in cash, which included the cost of renovation.
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​Each unit was rented for $900 per month, generating $21,600 in annual rental income. The gross rental yield was a jaw-dropping 48%!

I was excited and planned to scale by purchasing a portfolio of properties. My target was 10 properties, with a budget of around $500,000. The projected gross income was approximately $216,000 annually. With low carrying costs, as property taxes were only $500 per year, I thought it was a goldmine.
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​Below is my property, with the price of $45,000 underlined.

For the first year, everything went great. But then, the property management company started missing payments due to tenants falling behind on their rent. There was a high turnover rate because the neighborhood wasn’t ideal. Eventually, the property management company stopped sending payments and stopped replying to my emails. When I checked the property’s value, I was disappointed to see it hadn’t appreciated at all.
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​I began making decisions driven by emotion.

Frustrated with the situation, I attempted to find a new property management company but soon felt so discouraged that I gave up. I wanted to sell the property, thinking it wouldn't appreciate in value and wasn't worth the effort.

However, this wasn't my first misstep. It was a consequence of my initial mistake: chasing cheap.

Cheap properties often seem like a great deal on paper, but they’re usually cheap for a reason. The 'buy and pray' strategy—where you simply hope the property will appreciate and generate steady income—rarely succeeds. It might work, but it will cost you time, energy, patience, and money. You’ll have to deal with high tenant turnover, evictions, or find someone reliable to handle these challenges on your behalf.

Typically, buying the cheapest option means sacrificing key factors like location, property quality, and tenant quality. This approach can lead you to places that aren't landlord-friendly, poorly constructed homes, and less desirable areas, resulting in tenants with whom it's difficult to build long-term relationships. Unfortunately, the cheap price point is often a trade-off for more significant issues down the road. 

There’s a reason why cheap properties are cheap!
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Another mistake I made early on was partnering with the wrong people.

When investing in properties out of state or internationally and aiming for high-quality passive income, choosing the right partners is essential. Since you won't be able to visit your properties frequently, selecting the right partner is crucial. Success isn’t about randomly buying properties and hoping for the best; it’s about making informed decisions and collaborating with excellent teams. 
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​Finally, I made a critical mistake—I let my emotions cloud my judgment. I violated one of the fundamental principles of real estate investing: wealth builds over time. Instead of focusing on the long-term potential of my investments, I fell into the trap of short-term thinking and decided to sell the property.
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​To discover the four common mistakes to avoid for a successful real estate investment, click here

As I mentioned, chasing cheap rarely leads to success. However, in my case, I was investing at a time when the U.S. real estate market was still recovering from the 2008 crisis. Many areas had yet to return to their pre-crash prices, which meant there was significant potential for price growth if I had held onto the property. Unfortunately, I let emotions take control, selling the property prematurely and missing out on a rare opportunity for substantial appreciation.

In 2016, I sold the property for just $24,700, taking a loss simply just to get rid of it.

But then, something remarkable happened. Here's where it gets interesting: in 2019, another investor resold the same property for $150,000, and by 2023, it was sold again for a jaw-dropping $300,000.

Let’s break down some numbers:

Now, let’s calculate the cost of my poor decisions and missed opportunities:

So, the total cost of my mistakes—both the sale loss($20,000) and missed opportunities—was $380,000. And that’s just from one cheap property purchased 10 years ago.

That was a hard-earned lesson, but it highlighted the critical value of patience, emotional control, and selecting the right partners and properties when investing in real estate.

Had I kept that property instead of making an emotional choice to sell, I could earned $380,000 more over the past decade. This is the high cost of my mistakes. 

​In the next article, I’ll break down the math for the properties in my Canadian portfolio.

But for now, take this lesson to heart: many people miss out on substantial profits by either doing nothing in real estate or making poor decisions, but if you approach it wisely, the rewards can be immense.

Don’t let fear or skepticism hold you back from the wealth-building opportunities that are out there.

In the meantime, begin your journey today by exploring investment opportunities with our partner, SIH.

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