Category: Canadian Landlords

Canadian Real Estate Needs An Innovative Kick In The Ass

Small landlords are a component of arguably one of the least innovative markets on the web in Canada: real estate. When it comes to using services in the cloud, it’s a bit behind the pack. Strange, because in many ways, it’s a perfect example of a market  that can most benefit from using the convenience and utility of web based tools and services.

In an age where we see startups taking hard transformative glances at some of the most everyday things people do (couponing, group discounts, betting, customer relationship management, even organizing recipes), it’s difficult to understand why the Canadian real estate market in general has seemed to suffer from being left out in the cold – a frozen winter that is dated designs, unfriendly user interfaces, and a general sense of being stuck in the era of the internet pre-iPhone – when Internet Explorer 6 and Hotmail were standards.

A perfect example of this is Canada’s leading residential real estate listing service – Realtor.ca (formerly MLS.ca). Sure – it’s useful. It does the job – but it could really be a lot better. Canada’s number 1 visited real estate website hasn’t changed that much in over 10 years – and 2009’s mobile version of the application was met with as much enthusiasm as Microsoft’s Zune. Great idea – bad execution. It’s particularly embarrassing when you see what’s going on south of the border with great sites like Trulia and Zillow.com

So why is this? Is it possible that this market is controlled by a select group of barons – an old boys club so to speak – that just refuses to embrace the revolution that is Web 2.0?  The internet’s already in the throes of discussing what Web 3.0 is going to look like. We’re not sure. Is it too boring? It’s not a black and white situation. CREA has been fighting with the Competition Bureau about opening up the MLS database so that other sites and services can use it too. It’s been a real bone of contention. I’m not interested in making a comment on the spat between them. I’m simply pointing out that innovation on the web in Canadian real estate is perhaps being compromised because of it, and it doesn’t have to be. I’d love CREA to revamp the hell out of Realtor.ca and give some of these U.S. sites a run for their money. It feels like a bit of the Blackberry vs. iPhone/Android scenario. Come on! Canada’s real estate market is among some of the best in the world.

Back in 2008 – a little Canadian startup called Zoocasa entered the scene, hell bent on changing what a real estate listing looked like and how you found and searched for a home. It was “Home Search With Smarts”. It was developed as a slicker, more efficient alternative to the Multi Listing Service, and aimed at using the web to browse the housing market intelligently. These guys are a Rogers Ventures business – an impressive fact on it’s own. While the execution was great, realtors are required to post their listings proactively to the service, and there’s been issues with Realtor.ca in the past with “scouring” listings. Zoocasa was also successfully sued recently by Century 21 in Canada, and lost cases with individual realtors who took issue with the company “scraping” listings to populate it’s service.

The landlord market is no different. Most of the products for professional property managers and self managing owners seem like they’re geared more for corporations than landlords who have a secondary suite. Television shows like Income Property promote the benefits of having a subsidized mortgage, which has spurned increasing numbers of people to invest in duplexes and triplexes in the climbing Canadian real estate market of the last 10 years. It’s been a good ride and a lot of people have made a lot of money – but when it comes to “managing” a rental, it seems like you’re better off to keep that old manual ledger you picked up at Staples 10 years ago. Dust it off buddy – you’re a landlord now.

That’s changed in the last few years, and there’s been a series of new startups focusing on the small time landlord that have received a significant amount of attention, and in some cases, a significant amount of capital investment. Cozy – a San Francisco based startup –  is an example of that. Raising 1.5 million dollars of funding from the likes of Google Ventures and business guru and internet sensation Gary Vaynerchuk. Their aim of focusing on the two biggest pains in the butt for landlords – rental applications and tracking payments – takes a radically simplified look at the job of owning and managing rental property.

There are even cooler examples within the greater real estate realm. Lovely – another San Francisco based startup – has elegantly innovated the common apartment search for renters. One of the more interesting examples I recently came across which is real estate related, is The Dirt, a cool startup out of Toronto – that aims to populate it’s own property database “socially”. Cool idea. Their idea is about the sharing of information vs. Zoocasa’s aim to enhance what existed with MLS.

So what’s going on real estate? Share your thoughts with us.

Renting Well Gets Nominated For A 2013 Bootstrap Award!

Boot-strapping: A situation in which an entrepreneur starts a company with little capital. An individual is said to be boot strapping when he or she attempts to found and build a company from personal finances or from the operating revenues of the new company.

That’s an official definition. With that said, we’ve been nominated for an Exploriem Bootstrap award for best sales/value proposition – a category sponsored by Invest Ottawa. We’re pretty honoured to have been nominated for this, and we’re looking forward to the awards on February 21st in Ottawa.

Our co-nominees in the field include Edge to Epic, Gnow It, Tindr, and Toletta.

You can read the press release here. Exploriem is a registered Canadian not-for-profit corporation that provides mentorship, conducts events, creates networking opportunities and provides early stage funding as well as office incubator space to assist young entrepreneurs, intrapreneurs and artpreneurs in the cities of Ottawa and Gatineau as well as Eastern Ontario and West Quebec.

Why A Mortgage Broker Is A Landlord’s Best Friend

Had the opportunity to sit down today with one of our customers, Jacquie Bushell, of Oriana Financial, to discuss why a good mortgage broker should be one of the main contacts of every landlord and real estate investor.

Couple of things – Jacquie was one of Renting Well’s first users. She owns 2 condos (1 in Toronto and 1 in Ottawa). Also – over the last 4 years, Jacquie has helped me with financing and refinancing two buildings I own. She’s a pro when it comes to understanding some of the fundamentals in purchasing income property. She’s a mortgage ace, but she’s also a landlord herself, and that’s a good combo to have if you’re looking to get into the landlord pool. I had the opportunity to sit down with her and discuss some of the big pillars real estate investors and landlords to-be should know before they start their search or as they’re conducting one for that perfect building.

As Jacquie brings a wealth of experience to the realm of real estate investment and property management, families seeking to build their dream homes can benefit immensely from collaborating with seasoned professionals. In the context of family home building, the guidance of custom home builders Sydney becomes invaluable. These experts not only possess a deep understanding of the intricacies involved in constructing personalized residences but also bring a blend of financial acumen and practical knowledge. Much like Jacquie’s adeptness in navigating the complexities of income property, custom home builders can help families translate their visions into tailor-made homes like this custom home in Toronto, ensuring that the process is not only seamless but also results in a residence that reflects the unique preferences and needs of each family member. Work with the best builder who can make your dream home construction in Toronto and who can add the touches you want in your home.

In the world of real estate investments, having a knowledgeable mortgage broker like Jacquie Bushell on your side can make all the difference. Her expertise not only as a mortgage ace but also as a seasoned landlord adds a unique perspective to the table. For aspiring landlords and investors, understanding the financial intricacies is vital, and it goes beyond just securing a mortgage. One significant aspect to consider, especially for those aiming to expand their property portfolios, is the realm of 1031 exchanges. This is where specialists like The 1031 Specialists come into play, offering invaluable guidance to ensure seamless transactions and maximize investment opportunities. Partnering with experts who understand both the nuances of mortgage financing and the intricacies of 1031 exchanges can empower real estate investors, providing them with the tools and knowledge needed to thrive in the competitive market. To further enhance your strategic approach, you can use the landlord calculator from House Real which can assist in evaluating potential returns and optimizing investment decisions.

There’s essentially two different kinds of landlords. Live in landlords (a lot of first time buyers who want to live in central areas or who reside in higher priced cities like Vancouver and Toronto pick up multi families and live in one of the units – subsidizing their personal mortgages with added rental revenue) and live out landlords (real estate investors who don’t reside in their properties and rent out to others). Dive deep into Canada’s property waters with HomesEh. The best of Canadian real estate awaits! If you’re a live in landlord, you can get away with a smaller downpayment because you’re residing in the unit as your primary residence. If you’re a live out landlord, you’ll be required to put down at 20% of the purchase price. Let’s say you’re buying a $360,000 triplex. That’s $72,000 if you’re not putting your head on the pillow in the place.

Also, if you’re purchasing a condo or buying in a higher risk city like Vancouver or Toronto, many lenders may want an additional 5% for no good reason other than safety.

Here’s another few choice gem facts Jacquie shared.

  • If you’re buying anything more than a 4 unit multi family, that changes things. With the addition of  a fifth or more units, it will now be considered as commercial mortgage, and is treated differently than a traditional duplex or triplex situation – whether you’re living in it or not. Interest rates are typically a little higher.
  • Don’t assume that if you’re purchasing a rental property that all of the rental revenue that the place generates will be considered. It won’t. In many cases, lenders will only take into consideration 50% of the income received, which can make it harder for you to qualify. If it’s an owner occupied situation, up to 80% of the income can be considered. 
  • If you’re buying a rental property, the only way that the income on the unit will be considered when qualifying you for the loan, is if it has a separate entrance. 
  • Triplexes and fourplexes typically require 10% down payment if its owner occupied and 20% if you’re not living in it.

The statements above are general. Each purchase has its own uniquenesses and “yes” their can be creative financing. Your mortgage broker can help you with knowledge and options. Have you used a  mortgage broker for your rental properties? Share with us!

 

No One’s Happy with Rent Increase Propositions In Québec

Read this piece yesterday in the Montreal Gazette. The province’s Régie du logement du Québec announced proposed rent hikes for 2013 on January 25th, and the ire of both landlords and tenants was clear in about 3 seconds after the announcement was made. This is the thing though, the province’s proposal for rent increases are in fact just meant as guidelines – a starting point if you will. Actual rent increases are negotiated between landlords and tenants. The province’s press release even states – “it’s meant as a starting point in the discussion of how much the rent will increase“. In other words, they just give their two cents on where they think the talking point should begin. Ultimately, landlords and tenants have to hash it out.

Quebec’s rental board has announced a 0.9 per cent increase in rents for buildings heated by electricity, a 0.2 per cent rise for buildings heated by gas and a 1.7 per cent rise for dwellings heated by fuel oil.

The Association des Propriétaires du Québec, blasted the suggested hikes as inadequate. Anti-poverty group FRAPRU said the hikes were too high, pointing out that the number of cases filed against tenants for not paying their rent hit a record in fiscal 2011-2012, rising 3.2 per cent to 47,049, compared to the previous year. Something else to note here – the vacancy rate has crept up in Greater Montreal from 2.5 to 2.8 per cent according to the Canada Mortgage and Housing Corp.

  • You can find the press release from the Régie du logement du Québec here. 
  • You can read FRAPRU’s press release here. 

What do you think? Are you a landlord in Quebec? What are your thoughts on how the system works for you? Share your stories with us.