First of all, I'd like to say I've found this site quite imformative. I am interested in purchasing a resort/camp type of property in Northern Ontario. The asking price is $575,000 cndn. My wife and I would both need to quit our jobs in order to do this. We would only be able to come up with approx. $150,000-$200,000 for a downpayment. Is this a hopeless dream or do you see some possibilities. Thanks for your help.
Shawn,

Shawn,

No dream is hopeless if you back it with enough resources and market research to gain profitability from it.
Questions you need to ask yourself are-

1. What is the visitor frequency at the resort?

2. Operating Costs.

3. Burn Rate per month which means, during off seasons, would you be able to support the operating costs like maintenance?

In the end you might have the capacity to buy, but will you be truly able to gain profits from the business. Ask yourself that.
Good Luck!

I think that all of the people looking to take over or start this type of hospitality businesses are looking at the change in lifestyle as much as they are looking at the bottom line.

Riti is on the right track about how something like this would need to be underwritten. There are two revenue factors {average daily rate or “ADR”, and occupancy}. It is not as easy as multiplying one by the other because you need to adjust for off-season.

I don’t think anyone can tell you if it is possible. The percentages do not look that bad, but one has to has how much of that valuation is coming from the going concern and not from the value of the underlying real estate. Maybe the real estate is only worth $300,000 then you might have a problem getting a regular bank loan.

Good luck