Vanguard Mortgage Investment Corporation, Vancouver BC

February 24, 2014

Yield draws investors to mortgage investment corporations

Canadian investors are offered a stake in real estate — through a real estate investment trust or via a mortgage investment corporation (MIC). They are drawn to high yield paying real estate investment trusts or mortgage investment corporations.  Typically, the yield can range from 7% to 9% or more compared to 2% to 3% for GICs and government bonds. Many of these private MICs are based in Western Canada. View more info about Vanguard mortgage investment and past yield performance.

 Mortgage investment corporations in Vancouver

Vancouver Mortgage Investment

In recent years, many of the MICs are organizing seminars for Chinese investors to educate them on the investment options they have in Canada. Some of these MICs in Vancouver are actively targeting Chinese investors by advertising their offerings in various Chinese newspapers. Vanguard is one of these MICs well positioned to capture a share of the investment money from Chinese investors. You can learn more about Vanguard Mortgage Investment Corporation and its management team.

While it’s not known how much of the capital raised is invested in real estate, what’s known is that about $140 billion is raised annually in the market, an amount that’s larger that what’s raised in the public equity markets. Link to Financial Post report here. Although Canadian banks and credit unions are not discussing the merits of private mortgage investment, smart Canadian investors are learning about such high yield investment through other formal and informal sources.

Vancouver Mortgage Investment

Mortgage investment corporations, commonly called MICs in Canada come in various forms. These investments are real estate related, and they are governed by the Income Tax Act of Canada, and they pay out all their net income. The publicly traded entities receive wide press coverage, but their number is small compared to the more than 300 private MICs that are registered with the government. These private mortgage investment corporations received tax exempt investment like RRSP, TFSA, RESP, etc or a investor can invest his/her savings directly as a non-registered investment.

Why MICs are popular with investors? 

 The main reasons for the popularity of private mortgage investments to many investors are:

  • Predictable income. Income is distributed quarterly, which an investor can reinvest to earn compounded returns.
  • Low volatility. Vanguard’s mortgages are short term in nature (typically 6 to 18 months), which allows hedging against interest-rate risk and real estate market conditions.
  • Security. Vanguard’s mortgages are secured by real properties – diversify  portfolios across several markets, types of mortgages and properties.
  • Liquidity. An investor can access his/her capital early (certain restrictions apply) in the event you need it – not tied to the maturity date of individual mortgages.

For more info on whether private mortgage investment is suitable for you, kindly contact me (Elsie Tse) at 604-716-3369 or Email Me .

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