# Real Estate company - How/What to start?



## 3MAA (Jun 22, 2011)

Hello

Me and my wife own a townhome as a rental property since 2 years. The townhome is in our individual names. For future, I would like to open a real estate company in Ontario and the future purchase of properties after selling the current townhome, would be done through a company.

Can someone please explain or suggest what type of real estate comapny should I open?

Thanks in advance
Nimisha


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## themortgageguy (Jun 28, 2012)

Why do you want to start the company? What are you trying to achieve?


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## crazyjackcsa (Aug 8, 2010)

Contact a member here called Argo, he should be able to help you out. He's got some big ideas, just like you.


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## Quotealex (Aug 1, 2010)

@themortgageguy. It wont achive much since 1- the bank will demand that the lender personally garantee the mortgage (so no personal assets protection) and 2- the company will be fully taxes (propbably at a higher rate than they are currently taxed) since a real estate company is considered a passive income.


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## 3MAA (Jun 22, 2011)

themortgageguy said:


> Why do you want to start the company? What are you trying to achieve?


My next goal after setting a company is to purchase a multi unit apartment building, sothat I can use the proceed from the townhome under a company to purchase a building... I am sure a multi unit apartment needs a company... I need some details on the structure of Real estate organization...

thanks in advance...


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## themortgageguy (Jun 28, 2012)

Quotealex said:


> @themortgageguy. It wont achive much since 1- the bank will demand that the lender personally garantee the mortgage (so no personal assets protection) and 2- the company will be fully taxes (propbably at a higher rate than they are currently taxed) since a real estate company is considered a passive income.


Which is precisely why I asked the questions. If 3MAA thinks he won't be liable due to default he is wrong. No answer on why he feels the need to start the company though.


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## MoneyGal (Apr 24, 2009)

Isn't the OP actually asking about incorporation, versus "starting a real estate company"?


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## crazyjackcsa (Aug 8, 2010)

I think so MoneyGal, but it's hard to tell.


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## Quotealex (Aug 1, 2010)

3MAA said:


> I am sure a multi unit apartment needs a company... I need some details on the structure of Real estate organization...
> 
> thanks in advance...


 I have a few multi-units properties all under my personal name. In my case, it was alot easier to get mortgages through my personal name than through a company. 

Are you planing to have at least 5 employees working for that company you want to setup?


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## Wes Ryan (Sep 25, 2012)

It seems to me what he is actually asking is "What are the benefits to incorporating a company which I would use to purchase the properties?". As said, the financing probably won't change much as you would have to personally gaurentee it anyways. As far as multi tenant apartment buildings go you can buy them personally if you want. The benefits in incorporating often lie in taxation and liability. I wouldn't sweat it too much if its just you and your wife but if you do move into owning more units I would certainly consider it.


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