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wholesaling propertiesEvery few months, we get an onslaught of phone calls and emails that sound eerily familiar. They go something like this:

“Hi, I’m looking for a real estate partner to help me build my real estate portfolio. In particular, I’m interested in foreclosures and distressed properties. I’ve heard that one of the best ways to make money in real estate is to buy properties under market value. I’m also interested in wholesaling homes.”

With a few good probing questions, we usually hear:

“No, I don’t actually have a downpayment or any money. I want to use other people’s money to buy properties. Yes, I did just come back from a seminar about how to make money in real estate. How did you know?”

PEOPLE!!!! Stop spending your money on these seminars!!!!!!

As someone who actually works in the Toronto real estate market every single day, here are a few things you need to know:

1 – “I’m interested in foreclosures.” If someone tells you to look for ‘foreclosures’, RUN! We don’t have foreclosures in Canada, and anybody who tells you we do has no experience here. In Ontario, we occasionally have properties that are sold under Power of Sale. When people don’t pay their mortgages, banks sometimes have to sell the property to recover their losses – this is referred to as Power of Sale. But Canadian banks are far from desperate – they sell those properties via a very rigorous sales process that ensures they sell at a high price. Banks don’t give Power of Sale properties away. They aren’t deals. They don’t sell them at a loss. Power of Sale properties sell for market value – the fact that the bank is the Seller only makes the process longer, not cheaper.

2 – “I’m looking for distressed properties.” In a market as hot as Toronto’s, there’s no such thing as a distressed propertyPeople might be stressed. They might be selling for reasons that they wish they weren’t selling for. The house might be in bad shape. But in our current market – where there are too many buyers chasing too few houses for sale – we just don’t see desperate sellers who sell their houses for below market value. Sorry.

3 – “I want to buy properties under market value.” Well, HELLO – don’t we all? Market value is the price the market is prepared to pay for a home. So when a property has been properly exposed to the market and sells at a particular price, we call that Market Value. The only opportunities to buy under market value are when properties have not been properly marketed or exposed to the market. (Read: directly through the owner or when listed by lazy REALTORS).

4. “I’m also interested in wholesaling homes.” Despite having had this request from literally dozens of people, I still don’t really know what wholesaling homes means and no one has been able to explain it to me. Google has helped me a bit, and I think wholesaling homes means buying these ‘under market’ properties and re-selling them before they close (so you don’t actually have to come up with a downpayment or closing costs). This sounds risky. And dangerous. And maybe just a little bit shady. I highly doubt this actually happens in the Toronto market.

5. “I don’t actually have a downpayment or any money.” In Canada, you’ll generally need at least a 5% downpayment (and money for closing costs) and you’ll need to qualify for a mortgage – which means you’ll need good credit, reasonable debt and an income that can support the mortgage payments. I wish this real estate game was easy too, but it isn’t – work hard and save money the old fashioned way and get into real estate when you can comfortably do it.

6 – “I want to use other people’s money to buy properties.” I’m sure you do! But spending $1,000 on a 2-day seminar from someone who doesn’t live in Canada likely doesn’t qualify you to play with other people’s money. I always tell people to call me back when they’ve amassed their investors – I have yet to receive a return call.

7 -“Yes, I did just come back from a seminar about how to make money in real estate. How did you know?” Sorry to tell you this, but you’ve probably just wasted a bunch of money that could have been put towards your future downpayment.

So what’s the easy way to make money in real estate?
There is NO easy way.
There is NO magic bullet.
Stop spending your hard-earned money on get-rich-quick seminars and start saving your downpayment.



  1. I find your article helpful, although how could you be so negative about wholesaling if you still dont understand it fully or if you have never done it or tried it at least. it works . its unique, not for everyone.

  2. Hi Melanie.
    Ive taken a weekend course on flipping homes, and I disagree with your skepticism and here’s why. These programs are designed for U.S. investing. I agree with you. Canada’s market is different and homeowners here typically know the value of their properties better than the average American.

    In addition, U.S hard-money lenders make it much easier to get funding for the projects. They only slightly approve the individual, but moreso approve the project. All you need is 10% down and the hard money lender will lend you the rest, and even lend you the money for the rehab job.

    Its a fun and lucrative opportunity for an investor with some courage and willingness to work in the U.S. If you would be interested in partnering on a first deal, feel free to get back to me.

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