Alberta Landlords | Renting Well

Alberta Freeman On The Land Makes Life Difficult For Alberta Pensioner Landlord

Every landlord needs to be made aware of this situation. I read this piece in the Huffington Post today, and it made me quite angry. It ups the game in professional tenancy and redefines people taking advantage of other people for their own benefit.

Rebekah Caverhill is an Alberta landlord. She owns a duplex in Calgary’s Parkdale neighbourhood. She rented half of said duplex out to a guy named Andreas Pirelli back in 2011. The new tenant – a self described handyman – agreed to spruce the property up in exchange for 3 months of rent. When Caverhill came to inspect the work, she found that the kitchen and bathroom had been gutted and that the floors had been painted black. Pirelli declared the unit an “embassy” and identified himself as a freemen on the land. I’ll explain what this is…

Freemen on the land is a North American movement of “sovereign” citizens who basically believe that all statute law is contractual in nature. They further believe that law only governs them if they choose or consent to be governed. By implication, they believe that, by not consenting, they can hold themselves independent of government jurisdiction.

According to the B.C. Law Society and the FBI (who list the sovereign citizen movement as a domestic terror threat) Freemen may number up to 30,000 in Canada and hundreds of thousands in the United States. They believe they can avoid taxes, mortgages, utility bills and more. They state that they have an unfettered right to travel (hence their belief that they do not need driver’s licences, licence plates or insurance). They believe that government-issued identification is somehow different from the “natural person.” They commonly list their names in the format of “First:Last” (using a colon in between). They are loosely affiliated with Canadian “detaxers,” whose tenet is that income taxes do not have to be paid to the government.

In other words – they believe they can essentially do whatever it is they want and that laws don’t apply to them.

Back to Caverhill. Pirelli (also known as Mario Antonacci) changed the locks on the place, and informed Caverhill he was willing to pay $775 a month instead of the $1500 plus utilities they agreed on. To make matters worse, his company – CPC Universal Group – billed Caverhill $26,000 for the work. Caverhill also received a notice from the Land Titles Office and discovered the property had been liened for $17,000. Pirelli’s Linked In profile lists him as a supervisor/coordinator/estimator with CPC Universal Group AND a diplomatic minister with Sovran Nations Assembly – which has a website that looks as if it was designed in 1991. This guy must have a busy day.

As to be expected, when Caverhill – a pensioner who relies on the rental income – got police involved, they indicated to her that this was a civil matter, and that she needed to pursue this with the Alberta LTB.

Thoughts? Comments? Questions? As landlords, we all know professional renters exist, and they cost small landlords millions of dollars every year. Saying this is an interesting situation may be the world’s biggest understatement.

Hamptons Landlord Pens Letter Of The Year To Lousy Renters

Caught this hilarious piece on Jezebel today. Long story short: a landlord in the Hamptons rented a residence out to some young professionals for the summer – for $40,000. Sounds like a lot, but it’s chump change for the Hamptons. Seriously.

The summer ended. The landlord came back to the residence, and proceeded to have a heart attack over the condition of the property. Her outlet of choice to articulate her displeasure? The world’s best point form letter.

With damage including a variety of “bodily secretions” that included blood and soiled linens, broken locks, and damage to wood mouldings and drywall, the landlord clearly had reason to be more than a bit miffed. As much as this piece was written to be a bit tongue in cheek, part of me kind of agrees with the author’s suggestion on “what would you expect here?”. If 10 guys with Lacoste golf shirts and popped collars rent out a house for a summer, this kind of thing might be a given – even if they work for JP Morgan Chase.

The landlord clearly has never seen Weird Science, 21 Jump Street, or Superbad. If you do a quick hashtag search for parties in the Hamptons on Instagram – things like #hamptonsparty and #hamptonspartyface come up.

Either way. Good for a chuckle.

Use A Move In Inspection Report, Already. Geez.

Caught this hot piece on the Globe and Mail today. A little ditty called “How To Steer Clear Of Bad Tenants”. In it – the move in inspection report is cited as the second most important document between the landlord and his/her tenant, besides the actual lease. Here’s the kicker. Most landlords don’t use one.

This is interesting. When you rent a car they use one. When you rent a boat they use one. Hell…I remember renting movies at Blockbuster and getting a call about the DVD copy of State of Grace I rented once looking like it had been dropped when they opened the case. Some people think they’re experts at “reading” other people. They convince themselves out of the necessity to cover all the bases. They don’t check credit scores. They don’t call previous landlord references. They just assume that since the new tenant they just rented a unit to is employed and capable of paying the rent, the likelihood of a kegger is minimal or non-existent.

I’ll cut to the chase. You should always use one. It’s the basis of an understanding – one that is paired with a mutual acknowledgement between you and the individual(s) renting from you, that what you are providing is in a certain condition prior to move in, and that it is meant to be returned to you in a certain condition. It’s as simple as that. Using a move in inspection report has the potential to save you money, clear up any excuse of miscommunication, and covers you in the event of something going south.

In British Columbia, a Condition Inspection Report is required by provincial law. The tenant and the landlord need to complete, sign, and date the form to show the condition of the residential premises at the beginning and end of the rental agreement. B.C. is smart about this, especially with such a great concentration of renters. Think about it – one of the biggest sources of conflict between landlord and tenant is often condition of apartments. A mutually acknowledged and signed off report greatly reduces the number of hearings that go to the LTB. The Northwest Territories, Alberta, and Nunavut also require signed and mutually acknowledged inspection reports to be completed.

It’s not the law in other provinces, however, they’re still highly recommended and it doesn’t mean you can’t use them. The CMHC put together a handy little rundown of what you should look for and point out when doing an inspection. Here’s a taste.

Walls and ceilings: note any dents, holes, or cracks in the plaster; scuff marks that don’t rub off; tears, bubbles, or peeling wallpaper.
Floors: note stains or discolouration in carpets; tears in linoleum; cracked or chipped tiles; dents, scuffs, or stains on hardwood floors. Carpet cleaning laguna hills can get rid of any stains on carpets.
Trim (including moldings, door and window sills and door and window frames): note stains, cracks, leaks or other problems.
Electrical outlets and lights: make sure they function.
Bathroom(s): make sure all faucets (hot and cold) work without leaking; water runs clear, not brown or yellow; water carries sufficient pressure in the shower and toilet; hot water tank holds enough for your needs. Check for chips or scratches in fixtures and tiles; walls around the tub for “sponginess”; countertops for dents, scratches, or stains.
Kitchen: make sure all faucets (hot and cold) work without leaking; water runs clear, not brown or yellow; all appliances work and are clean. Check for chips or scratches in fixtures and tiles; countertops for dents, scratches, or stains.
Exterior roof and gutters: check for a reliable seamless gutter company such as seamless gutter company in Wilkesboro to ensure optimal water drainage and protection for your home. If you need roofing repairs, then make sure to contact your local roofing company for a quick fix. Colorbond roofers in Brisbane provide durable, stylish roofing options.
Deck, balcony or patio, if applicable: check for chipped stone, warped or cracked boards, or problems with exterior siding.

Smart indeed. You can see the full list here.

The End Of A Basement Apartment Renovation

Well….it’s done. 3 months, $33,000 later, and about 700 views on this video – the basement apartment from hell has been transformed. Check out the gallery of before – midway – and after images I’ve included here. You can also reference the previous posts here, here, and here about the whole process.

The budget doubled – namely because of some essential items that needed attention. Things like surprises that were found behind drywall (critical masonry and waterproofing that was needed), a required visit from a structural engineer, and a complete rewiring (including the removal of a fair amount of knob and tube electrical). In an effort to create an accurate characterization of this project, these things increased the budget on what was more in line of a common spruce up, and don’t reflect the requirement of any other unit except mine.

The place was a complete mess before – so I’m viewing this as a key investment bringing a unit up to operational cruise control for a while. Considering I was getting $450 a month for an apartment that was technically suppressing the value of the house considerably (something the appraiser told me prior to buying the building), and which was renting for below market average for the area, the fact that this renovation cost more than I was anticipating doesn’t really bother me.

Given the initial state of disarray, viewing the renovation as a strategic investment is a wise approach, especially when considering the long-term benefits it can bring. Opting for high-end interior design services during the renovation, provided by experts like www.9onmain.com interior design, can add significant value to your property. By investing in top-notch design solutions, you not only elevate the aesthetics of your unit but also enhance its functionality and appeal. The expertise of professionals from 9 on Main interior design can transform your space into a luxurious and inviting environment, maximizing its potential and making it a desirable option for potential tenants or buyers. In the realm of real estate, such investments not only justify the renovation costs but also ensure that your property stands out in the market, ultimately leading to higher returns and increased property value over time. Here’s a quick recap of what was done.

A complete down to the studs renovation. The removal of all drywall, insulation, and carpeting.
The reconstruction and masonry work on interior stone walls (former outside foundation walls prior to an addition in 1981).
The addition of an I-beam support for the ceiling.
Masonry work on outside entrance.
Interior stone wall masonry repair and parging
The replacement of water pipes running through the unit to the boiler, which increased the amount of natural light into the unit (they ran across windows).
The reconstruction of a full kitchen and bathroom.
The complete re-wiring of the entire unit – including the removal of knob and tube electrical and the addition of 18 insulated 20 year L.E.D. pot lights. Estimated energy savings vs. prior to the renovation on electrical consumption with these along is about 10%.
The removal of old baseboard heaters and the addition of highly efficient Dimplex electrical convection heaters with wall mounted thermostats. An estimated energy savings of about 20% vs. prior to renovation.
New appliances
Custom kitchen cabinetry and counter top courtesy of the good folks at Ottawa Cabinet Co. This ended up being 10% cheaper than buying pre-assembled cabinetry and a counter from Home Depot AND they were able to fabricate exactly to a measured space.
140 square feet of solid tile courtesy of the folks at Vesta Marble and Granite. The tile was used for a half wall set up in the bathroom, floors, a shower stall, and the kitchen.
Full re-plumbing, including the pin back of major drain pipes in the bathroom that impeded access to the shower and which the previous owner questionably built around.
New toilet, basin, kitchen sinks, taps, faucets, etc are installed with the help of this plumber
Creation of badly needed closet space
Painting
New carpet and appropriate under pad for a cement floor.

For the plumbing, we had to hire plumbers since everything had to be redone, and understanding the purpose of a sump pump was crucial in ensuring that all aspects of the home’s water management system were properly addressed. A sump pump helps prevent water damage by redirecting excess water away from the home’s foundation, which is essential for maintaining a dry and secure living environment. And to make the space a comfortable space to hang around in, installing an HVAC system is highly recommended. Additionally, considering the climate, engaging an ontario ac repair service would ensure the system functions optimally, providing consistent comfort year-round. Furthermore, an annual furnace repair service must be scheduled to keep your hvac system efficient. If you’re looking for ac repair honolulu services, you may contact local hvac companies. Visit sites like https://rapidrepairs247.com/ for additional guidance.

I was getting $450 a month. I’m aiming for $749 a month now, and just put up the listing. Couple of interesting things post renovation. The unit was originally a badly laid out 1 bedroom apartment. After doing all the work, and actually adding about 15 square feet to the place, I decided it was a better bachelor/studio unit, and I’m going to market it as such. Technically – the definition of a 1 bedroom apartment includes a separate and distinct living and bedroom area. In most cases, it also includes a door separating the bedroom. I feel a lot better about having a good sized and nicely put together bachelor unit than I did about a badly laid out and dingy 1 bedroom basement.

Looking at this as a long term exercise – and taking into account the increase in rent this will yield versus what I was getting before – without putting this down on paper – it will take me about 9 years to recoup the investment I made. This doesn’t take into account rent increases over that time or tenant turnover and a new set rent price. It also doesn’t take into account the value that’s been added to building (according to the appraiser I spoke with, it’s around $45,000). Lastly – it doesn’t take into account the reduction in operating attention I need to apply to the unit. All this to say, I’ve decided not to blow a gasket about how much this cost. From an operating perspective – I have a basement apartment that’s easier to market and rent now, and I’ll be earning an extra $3600 a year.

There’s a lesson I learned from this whole process. It’s essential to look at this as a long term thing. If you’re doing this – you might be inclined to finish it as quickly as possible, panic about budget, and neglect paying attention to details. You might also be inclined to jack up the rent unreasonably (especially after having not earned any money from the unit while you were doing the work) without doing some research on the rental market and taking into account the vacancy rate. Ottawa, a historically stable rental market and one of the best cities to be a landlord in – has experienced a significant increase in the vacancy rate. There’s way more selection. There’s also been a noticeable increase in landlords publishing astronomical and unrealistic rents post renovation to units. I don’t agree with this philosophy. Charging $1200 a month for a basement bachelor unit isn’t reasonable – even if you’ve spent $50,000 on fixing it up. You’ll just end up reducing the rent and getting desperate as you sit on a newly fixed up place in your search for a tenant – especially if it falls outside of the best times to rent an apartment. If I were to summarize the whole experience up – I’d give this advice…

Plan everything out before you start. Invest in drawings if you think it’s necessary. Have a clear understanding of what you want to do, what’s reasonable to do, and work towards a concise and air tight plan of action while simultaneously ensuring any essential and glaring things are accounted for and addressed to make it an appropriate environment for a tenant.
Hire good contractors just like these Trusted Vancouver plumbing professionals and make sure the work is done properly and to code. Don’t skimp. It will only end up costing you more money.
Assume there will be a 15% increase in your estimated budget. This helps with setting expectations and not panicking.
Consider items that add long term value to the building and incorporate them into the project if it’s reasonable and makes sense.
Mentally prepare yourself for surprises and avoid a panic. This includes a clear understanding that you’ll be working in a monetary negative – i.e. you won’t be earning money from the unit while also spending money on it.
Don’t overkill it. Know your space. Adding marble floors and stainless steel appliances might look nice, but it’s a rental. Those kinds of things might make sense if you’re renting out a premium spot with a premium rent. For most of us though – this isn’t the case.
Set a date and understand there are optimum times through the course of a year to rent a unit. Doing a major renovation and having it wrap up smack in the middle of January isn’t doing you any favours. There are considerably fewer people looking to rent an apartment in the middle of the winter. Plan the job at a time when it will end at least 30 days out from the best time to find a tenant.

***Last little update. Today – August 31st, 2013 – the day I published this post, I had 7 showings and ended up renting the unit to a new tenant at about 4:30 in the afternoon.

Have you renovated a unit from top to bottom? Worked on a basement apartment? Share you stories with us. How did it go for you?

Why Landlords Need To Change Their Perspective On Energy Efficiency

Came across this great piece about two Chicago landlords who decided that energy efficiency was going to be a central focus on their investment. Sandeep Sood and his wife own Chicago’s Jeffery Parkway Apartments, a 55 unit, 7 story building. They acquired the South Side building four years ago. They explain how the building was in bad shape, and one of the first orders of business upon purchase was the replacement of the building’s boiler.

“The first year we got this, we were able to retrofit a new stainless steel boiler. A little different design than your typical boiler. But we were able to increase our efficiencies by more than 60 percent with just this one measure,” says Sood. This and other efficiency upgrades cost about $110,000. Sood claims his total pay back on this investment occurred in about 2 years. Pretty impressive. In most cases, payback on efficiency investments like this occur in about 5-7 years. The Sood family’s units are all inclusive – in that they are paying the utility costs on rented units, but don’t assume that’s the only reason a landlord would do this. The piece goes on to mention a bit of a difference between older and younger landlords when it comes to stuff like this, and emphasizes the need for perspective with respect to investments in energy efficiency – even if your tenants are paying their own utilities.

Investing in energy-efficient upgrades, such as the replacement of outdated boilers with modern, high-efficiency models like the Vaillant ecoTEC Plus, can yield significant returns for landlords like Sandeep Sood and his wife. Beyond the immediate financial gains, these upgrades also contribute to sustainability efforts and enhance the overall quality of the property. The decision to opt for a stainless steel boiler with a unique design demonstrates a forward-thinking approach to property management, reflecting a commitment to both cost-effectiveness and environmental responsibility.

Daniel Olson, the Senior Energy Efficiency Planner with the Chicago Metropolitan Agency for Planning has a supporting consideration when it comes to putting money down on energy efficiencies and consumption with rental units. Even if you aren’t covering the utility costs.

“When you have happy tenants who have lower bills. They are going to lower your vacancy rates, so that you actually keep your buildings full with tenants which will increase the funds you have available,” Olson said. This is true. Keeping tenants in a unit can be less expensive than turning a unit over year over year. The agency mapped out a regional plan that identifies energy efficiency as one of the easier measures that can move the area toward sustainability. Things like upgrades to a high efficiency hot water heaters, insulating buildings and simply changing light bulbs to compact fluorescent lights and L.E.D.s.

But it’s not all on landlords either…sometimes tenants don’t care.

The conflict between landlords and tenants stemming from “split incentives” to install upgrades has been identified as one of the top barriers to capturing energy savings in commercially leased buildings, according to an indicator survey published by the Institute for Building Efficiency in 2012. The same thing applies to small residential landlords too. What’s a “split incentive” you might ask? It’s when tenants often pay the energy costs, leaving the owners with no interest in efficiency. Or conversely, if landlords pay the energy bills, the tenants have no incentive to conserve energy.

British Columbia has focused on this issue of split incentives. They started up something called the Green Landlords Project, and they published a compelling executive report on it. Check it out here.

What’s your take on energy efficiency? Have you made investments into your rental property with respect to it? Share with us!

It’s Time To Give Secondary Suite Landlords A Break

Landlords aren’t just people who own multi families and apartment buildings. Secondary suite landlords are numerous in Canada and the United States, and it’s on the rise.

I’m going to give a bit of definition to what constitutes a secondary suite, courtesy of our good friends at the CMHC.

The term “secondary suite” is generally used to describe a self-contained dwelling unit with its own kitchen and bathroom, which is separate from the principal dwelling in a house. It can be located either within the principal dwelling or in an accessory building on the same lot as the principal dwelling. These units are also known as “accessory apartments” and “in-law suites.

Here’s an interesting metropolitan Canadian fact. Conservatively, more than 1 quarter of British Columbia residents rent out a secondary suite to help with the mortgage. That’s a lot of people. 52% of Vancouver’s residents are renters. That’s also a lot of people. I think it’d be safe to assume these numbers are so high, because buying real estate out west is incredibly expensive. That’s a bit of an understatement.

Secondary suites are great. They provide a variety of benefits to neighbourhoods and communities. They’re also a significant source of affordable housing in serviced areas, and make better use of the existing infrastructure. They don’t change the character of neighbourhoods much and they diversify the housing types available. They also increase the number of residents living in an area, which in turn makes neighbourhood transit more viable and enhances commercial activity. Finally, they provide owners with income and increase property tax revenues for municipalities. That’s a whole bunch of double rainbows right there.

Secondary suites aren’t just popular in Vancouver and greater B.C. They’re big in Calgary too. The city has a 1.3% vacancy rate. That’s great news for landlords, but that’s pretty tight for people looking for a place to call home. To boot – mortgage rules changed in July of last year, making it a little more difficult to buy a home. As a result, Calgary is in the process of embracing secondary suites, much like the rest of western Canada, and is attempting to lax rules with respect to them as recently as before the beginning of 2013. Mayor Naheed Nenshi has been advocating easing restrictions on secondary suites for a while. One problem. Calgary’s city council doesn’t get it. Calgary’s already tight rental market is speculated to only get tighter after the flood that swept through the city. This is slated to be a key issue in the upcoming Calgary municipal election.

Secondary suites require a few things to conform legally. It’d be a lie to say that they’re all legal. They’re not. The point I’m trying to make is that the municipal laws that determine whether a suite is legal or not should be relaxed. Mayor Nenshi and several councillors have taken the position that existing suites across the city should be grandfathered in to be legally zoned suites, provided they comply with proper building and fire codes. Compliance with common sense rules like this is a given, of course.

The opposition on council have taken a not-in-my-backyard stance. They prefer the practice of having illegal suites reported by neighbours, and inspectors/by-law enforcement officers dispatched to investigate, and possibly enforce compliance with zoning and building/fire codes. Those in this camp appear to prefer want the to city focus additional resources to the inspection and enforcement of illegal suites in order to ensure the safety of Calgarians. That sounds like a relatively logical position, but in Calgary, legal secondary suites are tough to create because the province’s building code treats suites as duplexes or semi-detached dwellings with mandated separate heating and water tanks, restrictive square footage counts, among other difficult to meet regulations. To put this into perspective, according to a piece in the Calgary Herald in May of 2009, the city had shut down 2,104 “illegal” secondary suites because of bylaw non-compliance — not safety codes of any sort — since 2004. That amounts to the closure of 1 non compliant secondary suite a day. Seems a bit empirical to me.

What do you think? Are you a secondary suite landlord? Do you live in Calgary? Vancouver? Any other city that’s transitioning on the issue? Share your thoughts with us!

The Continuing Saga Of A Basement Apartment Renovation

So the continuing saga of my basement apartment renovation moves forth. I say continuing saga because it feels like a journey to Mordor. Since my last post about this, I’ve managed to get a lot done. The walls were all covered up, mudded, sanded, and painted with what I think is a wonderful eggshell colour I picked up at Benjamin Moore paints (2026-70 for all the paint nerds). I fell in love with this colour after having Simon Says Painting pros use it in my kitchen at home, and since I feel a bright but neutral colour is essential for a basement apartment, I figured this was a logical choice. I think it looks good, but it also plays off the natural light in the unit.

Another recent element of this renovation was insulation. This was something important that I wanted to address, as prior to the work being done and when the old tenant was in there, I noticed a significant transmission of sound between the main floor and the basement unit. I took a cue from Scott McGillvray on this one and used Roxul Safe’n’Sound insulation. After putting the drywall up, and packing the ceilings with the stuff (hence the necessity to use insulated pot lights), it’s as quiet as a library. For more great house renovation ideas to beautify your living space, you can visit a site Archute for more helpful info! If you want to use the basement as a bedroom for a family member who has a medical condition, one of the first things you need to consider is a comfortable bed. You may shop here to find the a suitable bed for them.

The big main thing that was finished in the last couple of days was the completion of the wiring and the installation of some high efficiency electric convection heater systems by Dimplex and coupled wall mounted thermostats (3 to be exact). I didn’t want to go the regular route with electric baseboard heaters and am big on efficiency, especially if it’s electric, and especially if tenants are shouldering the hydro cost (which they are in this case). There’s a total of 4500 watts of heat in the unit, which is more than comfortable. A furnace maintenance service can be availed when repair is needed. The insulated pot lights were finished and all 18 of them use LED bulbs which are meant to last for 20 years. Considering we just had air conditioner spring check up and the unit was also completely rewired, I’m curious to see how energy efficient the apartment is going to be.

What’s on Deck:

Property Management Software — Another shot of said bedroom

I’m doing a black and white tile kitchen and entrance, coupled with a contrasting darker colour for the bedroom carpet. Both the tile and the carpet have been ordered. I also have to buy some appliances, and get some kitchen cupboards and a counter top. I’m thinking of hitting up Restore from Habitat for Humanity for some of the last essentials. Beyond that, it’s taps, a bathroom basin and vanity, shower heads and handles, and a low flow toilet. I’m figuring I’ll have the place finished in the next two weeks.

Have you renovated a basement apartment? Challenges? Hurdles? What were some of your experiences? Share your story with us!

Landlords, Tenants, and Floods. This Is For You Alberta.

Came across this great piece at Law Now, that touches on the mess that Alberta’s floods have wreaked on both landlords and tenants in the province. The Centre for Public Legal Education Alberta has developed an info sheet to help people – both landlords and tenants-to understand their rights and responsibilities after the terrible flood.

There are a lot of great “pro tips” here, but one thing in particular jumped out at me when reading the fact sheet. The definition of a “frustrated tenancy”. According to the CPLEA, it’s as follows:

A rental agreement can be frustrated, which occurs when something happens that is out of the control of both parties, and makes continuing with the agreement impossible. There are many reasons why a tenancy can be frustrated including if the property is destroyed, if there is an order under the Public Health Act that says the property is unfit for human habitation, if the property is so damaged that a reasonable landlord would not fix the damage, or if it is so damaged that a reasonable tenant would not be willing to remain living there.

Check out the fact sheet here. It’s great.