October 6, 2022

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Real Estate Entrepreneur Earning Passive Income Explains His Strategy

5 min read
  • Vinny Soni has long wanted to free up his time to focus on charity work.
  • He worked tirelessly for years to save enough to buy rental properties that bring in passive income.
  • He now owns seven properties in Canada, which bring in CAD$3,600 a month in net profits.
  • Read more stories from Personal Finance Insider.

When Vinny Soni was 27, the only thing he wanted to do was charity work. “I wanted to get into a nonprofit,” he says. “It was the only thing I knew I wanted.” 

Soni, originally from Nadaun in India, moved to Canada in 2009 as an international student eager to study marketing. In the five years between arriving in North America and realizing he wanted to work for some kind of charitable organization, he accomplished a lot professionally. He had a career in advertising and marketing, working for both smaller companies and large corporations, even building up his own agency as well. 

But at 27, he made a promise to himself. “I decided I would resign at 35 so I can dedicate 50% of my time to a nonprofit,” he says. “The other 50%, I’ll do something where I can still make money, but I’m not bound to it.” 

Recently turning 35, Soni has hit this goal. He can comfortably leave behind his old job and dedicate more of his time towards a charity he’s building. But it’s not just saved money that’s allowing him to do this, it’s also a significant stream of passive income that he’s built for himself.

Starting in 2018, Soni started investing in real estate. He now owns seven different properties that bring in steady, recurring income each month. Still, buying property is not an overnight decision. It took time to save his initial down payment, and strategic choices to maximize his investment. 

He realized real estate would help him reach his goals faster than other investing options

From 2013 to 2016, before investing in real estate, Soni was putting a lot of his money in a fixed deposit account in India. 

Similar to a term deposit or certificate of deposit, he was enticed by the high interest rates these specialty accounts offered. In Soni’s case, this was 7% to 8%. “My focus was: make money, send money overseas, make sure that I keep getting those 7% to 8% returns,” he explains. 

But soon, he realized he could reach his goal more productively through real estate. “I realized that the appreciation of the property is much more,” he says. “Not only are you gaining equity, but you’re also gaining on the appreciation of the asset.” 

While using the term deposit account was helpful to him for a time, he knew switching to real estate investing was a better option for his goals in the long run. “The overseas money which I saved for three years before moving into the properties,” he says, “the return there was very low.” 

He lived frugally while increasing his income

When Soni was saving towards a down payment for his first property, he knew he needed to maximize his income while minimizing his expenses. “Was I able to afford a unit by myself? Yes,” Soni says. “But I didn’t want to do it because I wanted to make sure I had enough in my savings to invest and get ready for my future.” 

Soni lived frugally for years, particularly benefiting from living with roommates well past the point where he could afford to live alone. He also worked — almost constantly — for years. Outside of his job in advertising and marketing, he spent his weekend doing telecom and internet sales. 

“My motto was: My expenses have to be paid by the job I’m doing on the weekend, and my full-time job was 100% saved,” he tells Insider. 

His monthly expenses were around CAD$2,000 to $2,500 a month, this included his portion of rent — $700 at the time — bills, his car payments, and food. 

Ensuring his weekend job covered those expenses, Soni was able to set aside nearly everything from his corporate job where he earned over CAD$100,000, saving about $5,000 to $6,000 a month from this.  

He put down smaller down payments and then refinanced his loans

Once Soni was ready to start purchasing properties, he’d saved about CAD$100,000. So he found a property that felt right to him and negotiated to put down just 10% on the property — about $45,000. 

“I chose to pay an extra 3% on insurance for the property because I wanted to use that other 10% and reinvest it into another property,” he says. In the US, buyers who don’t put down 20% are required to purchase private mortgage insurance; the situation is similar in Canada.

He was then able to take the remaining $55,000 of his savings and invest it in more properties. He purchased his next two homes directly from the builder and was able to come to an agreement with them. “I paid $20,000 upfront for the [second] property,” he explained. “And then $1,000 every month, which wasn’t a burden for me.” 

When he bought his third home in May of 2019, the builder asked him to put 10% down on that one as well. This initial payment came out to about $50,000. To pay for this, he used the remainder of his original $100,000 as well as more money he’d saved between his first purchase and then. He bought his fourth home with some of this saved money as well.

Now, with the goal to keep purchasing properties, he takes advantage of refinancing his mortgages to free up the equity in his homes. 

“I bought my fifth and sixth property after refinancing my first and third,” he explains. He just bought his seventh home with a business partner. Of all of his properties, he lives in one, rents out four, and the last two are still being built. 

He’s now building wealth

From the four properties that are rented out, he nets about CAD$3,600 a month in profit (that’s just shy of $3,000 in US dollars). Once the last two are built and rented, he expects this number to rise.

But he doesn’t plan on just pocketing the money his rentals bring in. “That money I’m going to use to buy more properties,” he explains. 

When Soni set the goal to spend 50% of his time on charity, with the other half going towards something that would help bring in money, he wasn’t sure what that other thing would be. Now he knows: He’s building a real estate company

Speaking about his plan for the next three years, he describes big goals. “By the time I turn 38, I want to make sure my real estate company is automated,” he explains, saying he wants to have recurring income while being more hands-off. “On the personal side, I want to get to at least 10 properties in the next two years.”  


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