Nick Hill
Nick Hill has been a guest on Collecting Keys, the real estate investing podcast hosted by Mike DeHaan, Dan Austin and Dylan Koch.
Real Estate Investment Opportunities in Canada with Nick Hill
Mike DeHaan interviews Nick Hill, co-host of The Canadian Real Estate Investor podcast and partner at Land Bank, about how Canadian real estate differs from the US market. Nick explains why five-year mortgage terms force Canadian investors to underwrite deals at much higher interest rates, describes the "missing middle" housing shortage, and breaks down how his team brokers debt and equity for large development deals rather than lending off their own balance sheet.
Key takeaways
- Canada's most common mortgage product is a five-year fixed term, not a 30-year fixed, which makes market cycles much tighter and forces investors to plan around renewal at whatever the prevailing rate is.
- Nick's team underwrites deals so they still work at roughly 10% interest and targets double-digit cap rates; he cites an investor who wouldn't buy unless a deal penciled at 12% even when rates were near zero.
- Loan brokering is the lending equivalent of wholesaling - matching borrowers with the right lender from a large rolodex can generate large fees without holding the loan risk.
- The "missing middle" (anything bigger than a duplex, smaller than an apartment building) is under-built across North America; new Canadian laws allowing fourplexes and laneway/garden suites on single-family lots may open that up.