In this episode of the Wisdom, Lifestyle, Money Show, host Scott Dillingham sits down with Araceli, a mechanical engineer turned full-time real estate investor and renovation contractor based in Cleveland, Ohio. Araceli shares her inspiring journey from working 17 years in the Canadian aerospace industry to building a thriving real estate investment and contracting business south of the border. Her story is one that many Canadians can relate to — a good job with a ceiling on time and income, and a life event that forced her to think differently about building wealth.
After going through a divorce and facing the challenge of maintaining expenses on a single income, Araceli purchased her first investment property in Hamilton, Ontario for $180,000, converting it into three units. By 2016, she was living rent-free and generating $400 per month in positive cash flow — a lightbulb moment that changed her financial trajectory forever. However, as Canadian real estate prices surged with properties receiving offers $50,000 to $100,000 over asking, she could no longer find cash-flowing deals in Ontario. That search for affordable, high-yield properties led her to Cleveland, Ohio, where she purchased her first two houses for just $17,000 and $22,000.
Araceli walks listeners through the realities of investing in U.S. real estate as a Canadian, including the critical importance of hiring reliable property managers and contractors, understanding neighbourhood grading systems, and knowing the difference between a good deal and a money pit. She explains how rising construction material costs — which have nearly doubled since the pandemic — make it essential for investors to target properties priced at $100,000 and above for sustainable cash flow and appreciation. Scott reinforces this point, noting that most foreign national mortgage programs require a minimum loan size of $75,000, making a $100,000 purchase price the practical sweet spot.
The conversation also covers key financing options available to Canadian investors in the U.S., including DSCR loans that qualify borrowers based on rental property income rather than personal income, and ITIN mortgages for those with a U.S. tax identification number. Araceli shares how she secured her E-2 treaty investor visa, allowing her to live and work full-time in the United States running her renovation company. She discusses her partnership model, where Canadian investors provide capital while she handles sourcing, renovating, and managing properties — splitting profits and ensuring both parties have a vested interest in the deal.
Scott also highlights the growing trend of Canadians investing in U.S. real estate, with data showing Canadian buyers are the second-largest group of international purchasers of U.S. property. The episode offers actionable advice on understanding after repair value (ARV), choosing the right neighbourhoods using grading systems, and why buying adjacent to higher-graded areas can maximize property values. Whether you are a first-time investor exploring cross-border opportunities or an experienced investor looking for a reliable contractor and partner in Cleveland, this episode is packed with practical insights to help you take the next step.
Key Takeaways
- Canadian Real Estate Affordability Crisis Drives U.S. Investment: With prices in Ontario requiring over 50% down to cash flow, more Canadians are turning to affordable U.S. markets like Cleveland where properties can still generate strong returns at much lower price points.
- $100,000 Minimum Purchase Price for Sustainable Investing: Both Araceli and Scott independently recommend targeting properties at $100,000 or above to ensure positive cash flow, reasonable renovation costs, and access to foreign national financing with minimum loan sizes of $75,000.
- DSCR Loans Open Doors for Canadian Investors: Debt Service Coverage Ratio loans allow foreign nationals to qualify for U.S. mortgages based on rental income rather than personal income, eliminating the need for U.S. credit history or tax filings.
- Neighbourhood Grading Systems Are Essential: Understanding A through F neighbourhood ratings and buying in C-plus areas adjacent to B-rated neighbourhoods can maximize property value and rental demand while keeping acquisition costs lower.
- After Repair Value (ARV) Is the Most Critical Number: Investors must accurately determine what a property will be worth after renovations to avoid overspending on repairs that exceed the property's market value — especially with post-pandemic construction costs nearly doubling.
- Lease-to-Own Strategy Maximizes Cash Flow: Araceli turned a $22,000 property into $1,000 per month in rental income through a lease-to-own agreement, eliminating maintenance responsibilities while recovering her investment multiple times over.
- Reliable Contractors Make or Break Investments: A good property with a bad contractor or property manager can quickly become a failing investment — vetting your team is just as important as vetting the deal.
- Partnership Model for Time-Strapped Investors: Araceli offers a joint venture model where capital partners provide funding while she manages the entire renovation and sale process, splitting profits so both parties have skin in the game.
Links to Show References
- Araceli's Contact: Phone – (216) 272-0163; Email – aracelih.re@gmail.com (Mention you heard her on the Wisdom, Lifestyle, Money Show)
- LendCity Mortgages: lendcity.ca — For Canadian and U.S. investment mortgage pre-approvals
- USCIS E-2 Treaty Investor Visa Info: uscis.gov
- (00:00) - Introduction & Guest Welcome
- (00:02) - Why $100,000 Is the Minimum Purchase Price Sweet Spot
- (00:03) - Neighbourhood Grading Systems and Border Strategies
- (00:04) - Why Canadian Real Estate Prices Pushed Her to the U.S.
- (00:06) - The Lightbulb Moment: Living Rent-Free with Cash Flow
- (00:12) - Buying Houses in Cleveland for $17,000 and $22,000
- (00:21) - The Growing Trend of Canadians Investing in U.S. Real Estate
- (00:24) - How to Get Started and Reach Out to Araceli
- (00:30) - Lease-to-Own Strategy for Maximum Cash Flow
- (00:34) - The Importance of Reliable Property Management
- (00:38) - Multifamily Cash Flow Example: $95,000 Property Generating $2,200/Month
- (00:45) - DSCR Loans and ITIN Mortgages for Foreign Nationals
- (00:45) - Partnership Model: Capital Partners and Profit Splitting
- (00:47) - Building a Trusted Team for Cross-Border Investing
- (00:49) - Understanding After Repair Value (ARV) and Contractor Costs
- (00:50) - From Aerospace Engineer to Real Estate Investor
- (00:51) - Starting a Renovation Company in Cleveland
- (00:53) - Financing U.S. Real Estate: Cash Purchases vs. Mortgages
