The pool of renters is getting deeper by the quarter for landlords, according to a CMHC report.
“More now than ever, we’re still a strong rental market in Ontario, and, in some cases, it’s outweighing the demand we see for homeownership,” said Ted Tsiakopoulous, CMHC’s Ontario Regional Economist, in an interview with CREW.
“There is strong demand amongst millennials aged 25-34 to rent condos because they can’t yet afford that down payment, or are taking longer to do so, but still want to rent along a transit line.”
It’s not just here in Toronto, he said, with London, Kitchener and Hamilton seeing the same trend, where demand could outpace the GTA in resale markets.
His comments come as the CMHC is expecting housing activity will increase throughout most of 2015 before slowing down in 2016, with the expectation that mortgage rates could rise.
The news also comes at a time when investors are riding high on optimism and confidence in Toronto and Vancouver. Some 55% of investors in the latter market anticipate value gains this year – a seven percentage point jump from the 2013 figure.
While the results of the survey took place largely before the oil shock took hold, Ontario and B.C. have come away relatively unscathed from the short-term impact now being felt in the Prairies.
Among respondents, 54 per cent bought their last secondary condo unit for rental income, though that figure rose to nearly 80 per cent among investors whose last purchased unit was rented out at the time they responded to the survey. Many plan to hold on to their investments for five years or more.
“An improving economy will be more supportive of the Ontario housing market in 2015 than it has been in the recent past,” said Tsiakopoulos. “However, as mortgage carrying costs continue to grow, particularly for single-family homes, demand will increasingly shift to more affordable housing.”
While home prices are expected to grow at a slower rate, sales are forecast to range between 192,000 to 218,000 units in 2015 before slowing to between 182,900 and 213,400 units in 2016.
Source: http://www.canadianrealestatemagazine.ca/news/rental-demand-outpaces-homebuying-demand-191646.aspx
Wednesday, May 27, 2015
Monday, May 25, 2015
What is a syndicated mortgage?
For those looking to get into the real estate game without becoming a landlord, one alternative to the traditional bricks and mortar is mortgage investing. To help make sense of the mortgage investing landscape, CREW took a look at some of most popular options available, starting with syndicated mortgages.
A syndicated mortgage is where two or more investors invest in one specific mortgage. Typically they involve investors becoming the lender to a developer to build a project, such as a condo, low-rise, single family or commercial development, although a single residential mortgage can also be syndicated.
There are several things that differentiate syndicated mortgages from Mortgage Investment Corporations (MICs), including the fact that investors can choose which projects they wish to invest in. Syndicated mortgages also allow investors the additional security of having their name registered on title as a charge holder against the property, which gives them the opportunity to recoup their capital if the project fails.
Syndicated mortgages lending to developers has grown considerably since the 2008 recession because the big banks have required more equity from developers, causing them to look for third party lenders to make up the shortfall.
A syndicated mortgage provides developers with the capital and equity they need to take their project from conception to completion by working in conjunction with bank financing and developer equity. Typically, the developer uses the funds to pay for soft costs, such as consultants, zoning and architecture and marketing costs such as the sales centre.
The risk with these types of investments is knowing what projects to invest in and who you are lending your money to. Many syndicated mortgages are offered by firms that conduct all the due diligence on the developers and the projects and who offer investment opportunities through financial professionals, such as mortgage brokers, financial planners and other professionals, directly to consumers.
Syndicated mortgage investments are not securities, so they fall under the purview of the Financial Services Commission of Ontario, and therefore are open to most investors and not restricted by accredited investor rules. Investors are also able to use RRSP, TFSA, LIRA and other registered funds to invest in syndicated mortgages.
For Sean Greene, president of the Platinum Investment Real Estate Group the smaller investment amounts of syndicated mortgages make them attractive to the occasional investor.
“Even if you don’t have $300,000, maybe you have $25,000, you can still participate in that actual investment and I think that’s a benefit as opposed to a $250,000 mortgage and you only have $25,000 and if we couldn’t syndicate that.”
Source: http://www.canadianrealestatemagazine.ca/strategy/what-is-a-syndicated-mortgage-191516.aspx
A syndicated mortgage is where two or more investors invest in one specific mortgage. Typically they involve investors becoming the lender to a developer to build a project, such as a condo, low-rise, single family or commercial development, although a single residential mortgage can also be syndicated.
There are several things that differentiate syndicated mortgages from Mortgage Investment Corporations (MICs), including the fact that investors can choose which projects they wish to invest in. Syndicated mortgages also allow investors the additional security of having their name registered on title as a charge holder against the property, which gives them the opportunity to recoup their capital if the project fails.
Syndicated mortgages lending to developers has grown considerably since the 2008 recession because the big banks have required more equity from developers, causing them to look for third party lenders to make up the shortfall.
A syndicated mortgage provides developers with the capital and equity they need to take their project from conception to completion by working in conjunction with bank financing and developer equity. Typically, the developer uses the funds to pay for soft costs, such as consultants, zoning and architecture and marketing costs such as the sales centre.
The risk with these types of investments is knowing what projects to invest in and who you are lending your money to. Many syndicated mortgages are offered by firms that conduct all the due diligence on the developers and the projects and who offer investment opportunities through financial professionals, such as mortgage brokers, financial planners and other professionals, directly to consumers.
Syndicated mortgage investments are not securities, so they fall under the purview of the Financial Services Commission of Ontario, and therefore are open to most investors and not restricted by accredited investor rules. Investors are also able to use RRSP, TFSA, LIRA and other registered funds to invest in syndicated mortgages.
For Sean Greene, president of the Platinum Investment Real Estate Group the smaller investment amounts of syndicated mortgages make them attractive to the occasional investor.
“Even if you don’t have $300,000, maybe you have $25,000, you can still participate in that actual investment and I think that’s a benefit as opposed to a $250,000 mortgage and you only have $25,000 and if we couldn’t syndicate that.”
Source: http://www.canadianrealestatemagazine.ca/strategy/what-is-a-syndicated-mortgage-191516.aspx
Tuesday, May 19, 2015
How to market your property for the right tenant
The very first thing to do when marketing your investment property is create an ad that will immediately weed out those who don’t fit the tenant profile you’re interested in attracting.
Marketing properly can save you time and money. Here are some helpful tips to attract great tenants and rent your property for top dollar.
1. Be clear and concise in your advertisement words.
Use a headline that will prompt readers to open your ad. For example: Beautiful backyard, just in time for summer; completely renovated and brand new unit; large, two-bedroom with escarpment views; walking distance to Go-Transit. Think of the best feature that your property has to offer and use it in your headline.
Do not make your ad too wordy. The first few lines will outline why your property is so great. Highlight points so the reader can quickly look through your ad and check off all the features that are important to them.
Your first few lines might say: This spacious and well-kept two bedroom is a dream apartment. Just steps from the lake and close to transit, this home offers a great location for all your leisure and transportation needs.
After you paint a picture for the reader, break down the key features of the property: number of bedrooms and bathrooms, laundry facilities, parking, appliances, special features (hardwood floors, freshly painted, fenced backyard).
2. Market at the right time.
There are certain days of the week and times of day that readers tend to shop online. Advertising on a Monday morning is not the ideal time. People are catching up on work projects or completing a list of chores.
Also important is the time of the month. Listing a property at month start will give you maximum exposure for those who have just begun to look for a rental.
If the month is coming to a close and you have not found the right tenant, be wary of the end-of-the-month crowd. These potential tenants have usually struggled to find a place due to bad credit, lack of income or poor references. Be wary, but still reply and screen them over the phone as their situation could be different.
Marketing a property two or more months before it is available is a vast waste of time. Most people give 60 days’ notice and do not begin to look for a new home until that time. If you market too early, tenants will make appointments to see your property but will often not commit as they will wait to see what other properties will be advertised in comparison.
Best times to market: First day of the month, Thursday and Friday evening to book showings for that weekend. First weekend of the months is always the busiest and most productive to schedule a viewing for a potential tenant.
3. Pre-screen tenants.
It’s hard to know what tenant is a good fit just from an email or phone conversation. A good question to ask is: “Tell me what you’re looking for in a property?” This is an open-ended question that allows the potential tenant to tell you what features are important to them. Often, you will discover what their current living situation is, if they have pets and how many people will be occupying the property.
If you have a large number of calls or emails that only ask to view the property, save yourself some time and schedule an open house. Break up the times in 15-minute increments. Don’t schedule more than three people during these increments because it will not allow you to meet and evaluate the potential tenant.
4. Always be professional.
Be prepared for a flood of responses when you post your ad. The first 48 hours is when you’ll attract the most attention. Make time to respond, preferably within that day. If you are responding with a phone call, do this in a quiet location where you are not distracted or have background noise.
You must treat this like a business. You would not call a client back while shopping for groceries at the supermarket.
Marketing properly can save you time and money. Here are some helpful tips to attract great tenants and rent your property for top dollar.
1. Be clear and concise in your advertisement words.
Use a headline that will prompt readers to open your ad. For example: Beautiful backyard, just in time for summer; completely renovated and brand new unit; large, two-bedroom with escarpment views; walking distance to Go-Transit. Think of the best feature that your property has to offer and use it in your headline.
Do not make your ad too wordy. The first few lines will outline why your property is so great. Highlight points so the reader can quickly look through your ad and check off all the features that are important to them.
Your first few lines might say: This spacious and well-kept two bedroom is a dream apartment. Just steps from the lake and close to transit, this home offers a great location for all your leisure and transportation needs.
After you paint a picture for the reader, break down the key features of the property: number of bedrooms and bathrooms, laundry facilities, parking, appliances, special features (hardwood floors, freshly painted, fenced backyard).
2. Market at the right time.
There are certain days of the week and times of day that readers tend to shop online. Advertising on a Monday morning is not the ideal time. People are catching up on work projects or completing a list of chores.
Also important is the time of the month. Listing a property at month start will give you maximum exposure for those who have just begun to look for a rental.
If the month is coming to a close and you have not found the right tenant, be wary of the end-of-the-month crowd. These potential tenants have usually struggled to find a place due to bad credit, lack of income or poor references. Be wary, but still reply and screen them over the phone as their situation could be different.
Marketing a property two or more months before it is available is a vast waste of time. Most people give 60 days’ notice and do not begin to look for a new home until that time. If you market too early, tenants will make appointments to see your property but will often not commit as they will wait to see what other properties will be advertised in comparison.
Best times to market: First day of the month, Thursday and Friday evening to book showings for that weekend. First weekend of the months is always the busiest and most productive to schedule a viewing for a potential tenant.
3. Pre-screen tenants.
It’s hard to know what tenant is a good fit just from an email or phone conversation. A good question to ask is: “Tell me what you’re looking for in a property?” This is an open-ended question that allows the potential tenant to tell you what features are important to them. Often, you will discover what their current living situation is, if they have pets and how many people will be occupying the property.
If you have a large number of calls or emails that only ask to view the property, save yourself some time and schedule an open house. Break up the times in 15-minute increments. Don’t schedule more than three people during these increments because it will not allow you to meet and evaluate the potential tenant.
4. Always be professional.
Be prepared for a flood of responses when you post your ad. The first 48 hours is when you’ll attract the most attention. Make time to respond, preferably within that day. If you are responding with a phone call, do this in a quiet location where you are not distracted or have background noise.
You must treat this like a business. You would not call a client back while shopping for groceries at the supermarket.
Thursday, May 14, 2015
Size matters less than quality to homebuyers
Canadian homebuyers are willing to compromise on the size of their new home but some things are not negotiable, according to a new survey
The Canadian Home Builders’ Association's inaugural survey of the preferences of recent homebuyers found that 35 per cent would like a single-family detached two-storey home; however, while 22 per cent would adjust their size requirements none would lower expectations of quality or energy efficiency.
The ‘must-haves’ in a new home include walk-in closets and energy-efficient appliances; both were considered vital by 68 per cent.
More than half (53 per cent) of the 12,000 respondents said that their community should have walks, and cycle paths and parks were also important for 41 per cent.
The demographic of those buying homes, including first-home buyers, is dominated by generation X (46 per cent) with millennials (gen Y) making up 38 per cent. Unmarried couples with no kids make up a large percentage of all buyers of new homes.
The Canadian Home Builders’ Association's inaugural survey of the preferences of recent homebuyers found that 35 per cent would like a single-family detached two-storey home; however, while 22 per cent would adjust their size requirements none would lower expectations of quality or energy efficiency.
The ‘must-haves’ in a new home include walk-in closets and energy-efficient appliances; both were considered vital by 68 per cent.
More than half (53 per cent) of the 12,000 respondents said that their community should have walks, and cycle paths and parks were also important for 41 per cent.
The demographic of those buying homes, including first-home buyers, is dominated by generation X (46 per cent) with millennials (gen Y) making up 38 per cent. Unmarried couples with no kids make up a large percentage of all buyers of new homes.
Monday, May 11, 2015
Home renovations increase although with lower budgets
With higher house prices in many areas and economic uncertainly weighing heavily on some homeowners’ minds, more are choosing to stay in their current homes and renovate.
A survey conducted by Nielsen for CIBC reveals that the number of homeowners planning to renovate has increased from 40 per cent last year to 42 per cent in 2015. However, the average budget has fallen from $20,000 to $17,000.
Top priorities are general repairs and redecoration (64 per cent) followed by landscaping (28 per cent) and new bathrooms (29 per cent) and kitchens (28 per cent). The largest percentage of people are planning to spend between $5,000 and $10,000.
Scott McGillivray, a real estate investor and host of HGTV's Income Property, commented: "I find that more and more people right across Canada are looking for creative solutions to add more space so that they don't have to move.”
He advises homeowners to concentrate on practical improvements rather than spending money on “wow” factors such as a swimming pool: "You don't want to build a $150,000 custom kitchen in a $200,000 home. You have to be realistic about your needs, and where money is best spent."
A survey conducted by Nielsen for CIBC reveals that the number of homeowners planning to renovate has increased from 40 per cent last year to 42 per cent in 2015. However, the average budget has fallen from $20,000 to $17,000.
Top priorities are general repairs and redecoration (64 per cent) followed by landscaping (28 per cent) and new bathrooms (29 per cent) and kitchens (28 per cent). The largest percentage of people are planning to spend between $5,000 and $10,000.
Scott McGillivray, a real estate investor and host of HGTV's Income Property, commented: "I find that more and more people right across Canada are looking for creative solutions to add more space so that they don't have to move.”
He advises homeowners to concentrate on practical improvements rather than spending money on “wow” factors such as a swimming pool: "You don't want to build a $150,000 custom kitchen in a $200,000 home. You have to be realistic about your needs, and where money is best spent."
Monday, May 4, 2015
Tips for investing in curb appeal
There is a wide variety of planting that can create the necessary curb appeal for enhance the appearance of your income property. The wonderful thing about planting is that it gives back. Your investment, if kept healthy, keeps growing.
Here are a few plants to consider for your property:
1. Boxwood can relate strongly to architecture because it can be clipped and shaped into hedges to follow the lines of the house. It's a broadleaf evergreen, so though leaves eventually darken in winter time, they don't shed like most deciduous plantings, thus adding a touch of green most of the year.
2. Columnar Beech trees add beautiful architectural forms to the landscape. Their verticality offers privacy and helps define the edge of the property. They can also be placed tightly together and kept clipped to act as a wonderful tall hedge screen.
3. Beech Hedging is popular because it's also resilient. It comes in green and purple, does not take up a lot of room, and has great structure. The purple-leaved varieties add a wonderful colour to the garden and the Beech tend to keep their leaves well into winter after they have dried out, adding winter visual interest and screening, when mist other trees are bare.
4. Japanese Maple is generally a great addition to a garden. These come in many colours, sizes and shapes – they make great feature plants in a garden. They can also have a wonderful layered look, framing gardens or making great backdrop plants as well.
5. Multi-stem flowering trees such as serviceberries, pagoda dogwoods, redbuds and birch provide great accent forms and structure in gardens.
6. Flowering trees such as apples, cherries, pears and magnolias provide a beautiful burst of colour in spring and enhance the look of the garden.
7. Ground covers such as ivy or periwinkle for shade and creeping thyme and sedum for sun are great alternatives to the grass lawn, adding beauty and variety to the garden floor.
8. Hardy grasses are also a good consideration because they withstand drought, tend to hold their form well into winter, and offer beautiful plumes.
Larger properties normally require a good maintenance company to keep their landscaped gardens in order. These companies will make sure that soil is in good condition and that the plants are in good health. A professional approach will deter from destroying the plants or damaging the delicate materiality of the garden.
As we are facing the effects of climate change, one important thing to consider is the balance between hard-scaped and soft-scaped areas. It’s a good to create rain gardens where runoff water can slowly percolate and be absorbed by the soil. Use of permeable paving also helps manage water runoff.
Another good tip is to use a variety of native species of plants. Native prairie grasses typically withstand drought and harsh weather, with great varieties to choose from. They add more resilience to the garden, thus adding visual interest as well as biodiversity.
Here are a few plants to consider for your property:
1. Boxwood can relate strongly to architecture because it can be clipped and shaped into hedges to follow the lines of the house. It's a broadleaf evergreen, so though leaves eventually darken in winter time, they don't shed like most deciduous plantings, thus adding a touch of green most of the year.
2. Columnar Beech trees add beautiful architectural forms to the landscape. Their verticality offers privacy and helps define the edge of the property. They can also be placed tightly together and kept clipped to act as a wonderful tall hedge screen.
3. Beech Hedging is popular because it's also resilient. It comes in green and purple, does not take up a lot of room, and has great structure. The purple-leaved varieties add a wonderful colour to the garden and the Beech tend to keep their leaves well into winter after they have dried out, adding winter visual interest and screening, when mist other trees are bare.
4. Japanese Maple is generally a great addition to a garden. These come in many colours, sizes and shapes – they make great feature plants in a garden. They can also have a wonderful layered look, framing gardens or making great backdrop plants as well.
5. Multi-stem flowering trees such as serviceberries, pagoda dogwoods, redbuds and birch provide great accent forms and structure in gardens.
6. Flowering trees such as apples, cherries, pears and magnolias provide a beautiful burst of colour in spring and enhance the look of the garden.
7. Ground covers such as ivy or periwinkle for shade and creeping thyme and sedum for sun are great alternatives to the grass lawn, adding beauty and variety to the garden floor.
8. Hardy grasses are also a good consideration because they withstand drought, tend to hold their form well into winter, and offer beautiful plumes.
Larger properties normally require a good maintenance company to keep their landscaped gardens in order. These companies will make sure that soil is in good condition and that the plants are in good health. A professional approach will deter from destroying the plants or damaging the delicate materiality of the garden.
As we are facing the effects of climate change, one important thing to consider is the balance between hard-scaped and soft-scaped areas. It’s a good to create rain gardens where runoff water can slowly percolate and be absorbed by the soil. Use of permeable paving also helps manage water runoff.
Another good tip is to use a variety of native species of plants. Native prairie grasses typically withstand drought and harsh weather, with great varieties to choose from. They add more resilience to the garden, thus adding visual interest as well as biodiversity.
Subscribe to:
Posts (Atom)