1451 replies to this topic

[Victoria Watcher]

i guess i meant rent defaults but yes i guess it might be hard to know.

[Citified.ca]

 

Ten on the 10th: Rental housing and COVID-19 Q&A with David Hutniak of LandlordBC

https://victoria.cit...-of-landlordbc/

[Casual Kev]

I'm looking to buy but still keeping tabs on rentals; I'm flabbergasted there are property managers/owners who are actually increasing their asks. I mean, literally trying to cover mortgage + strata + tax bills today with just the rent + utilities + extras. Once the Trudeau handouts run out there will be a LOT of tenants going delinquent, and a LOT of STR and student-oriented homeowners forced to go long term because of the collapse of tourism and international education. Seems like a lot of landlords don't understand what's coming, and trying to extract an extra hundred or two monthly is going to cost a whole lot more when they can't find tenants who can actually pay bills.

[Mike K.]

Sorry, not sure that I follow.

Don’t landlords always try to cover the mortgage, insurance, tax, strata and other costs by the rent they seek?

[VIResident]

Seems like a lot of landlords don't understand what's coming, and trying to extract an extra hundred or two monthly is going to cost a whole lot more when they can't find tenants who can actually pay bills.

 

Nailed it Casual Kev. 

 

All municipalities, rental property owners, property management operators, homeowners with 'mortgage' helpers etc. are about to experience a rude awakening, a total change from 3 months ago. 

• Renters will have a choice of where they wish to spend their money and with whom. 
• Renters will be in drivers seat on rental fees and negotiate those fees - don't want to play Landlords? Watch the backs of them as they walk away
• Security deposits negotiable and pets will be allowed everywhere.
• Lineups to see a rental gone 
• Renters will be asking for references from landlords they potentially may rent from.
• Landlords will be providing inducements within units i.e. upgraded appliances etc. including building perks
• Landlords will have to spit & polish their rental, curb appeal, noise etc. will have to be managed
• The best of the best rentals, those large, well cared for, beautiful rentals will rise to the top, and there will still be competition if the rent rate is competitive - meaning far far less than landlords commanded in the past.

Edited by VIResident, 18 April 2020 - 06:13 AM.

[Victoria Watcher]

not sure it's all going to flip that fast.

 

85% of people paid their entire rent last month most polls show.  of the other 15% most paid at least some.  about half the people that sought rent relief (asked their landlord for some type of break) were denied.

Edited by Victoria Watcher, 18 April 2020 - 06:18 AM.

[VIResident]

Sorry, not sure that I follow.

Don’t landlords always try to cover the mortgage, insurance, tax, strata and other costs by the rent they seek?

 

In the past Mike short answer, yes and no.

 

In the past the return on the investment was not necessarily in 'recouping' all current costs via a rental payment. - Property owners factored in the increase in the actual property 'value', the return on the investment over and above the immediate 'rental fee' and over the long term.  Get the highest rental rate possible of course, however, crunch the numbers on the return the property will provide when selling.  When figuring in the highest 'rental rate' possible - turnover is expensive - a lower rate than the going average attracts and keeps the 'dream' tenant - also providing the investor a fantastic return. 

If the plan is to only keep a rental for 5 years, less, a different investment approach to type of tenant etc. is required.

[VIResident]

not sure it's all going to flip that fast.

 

85% of people paid their entire rent last month most polls show.  of the other 15% most paid at least some.  about half the people that sought rent relief (asked their landlord for some type of break) were denied.

 

It is happening right now - it's flipped. 

 

If you have time on your hands - have a look at the rentals currently available, pretend to be a potential renter, go through the motions and see what happens. 

 

3 of our personal and close friends:

one single, another a couple and not that it matters - LGBTTQ, and yet another single mom 3 children, 2 dog 

• all had several top choices
• all have secured rentals - their preferred top choice 
• rentals located in Oak Bay, Victoria and Saanich
• less rental rate (by 25%) than 3 months ago (all of them had been scanning rentals for many months) and;
• far easier for them to rent than they've ever had in their history of renting

[Victoria Watcher]

oh i agree that right now while 25 or 45% of people are laid off it's good pickings.  plus who would move now you can just not pay your rent and you are fine.  but when this passes i'm not sure it'll be as you describe.

[Mike K.]

<p>

Nailed it Casual Kev.

All municipalities, rental property owners, property management operators, homeowners with 'mortgage' helpers etc. are about to experience a rude awakening, a total change from 3 months ago.

• Renters will have a choice of where they wish to spend their money and with whom.
• Renters will be in drivers seat on rental fees and negotiate those fees - don't want to play Landlords? Watch the backs of them as they walk away
• Security deposits negotiable and pets will be allowed everywhere.
• Lineups to see a rental gone
• Renters will be asking for references from landlords they potentially may rent from.
• Landlords will be providing inducements within units i.e. upgraded appliances etc. including building perks
• Landlords will have to spit & polish their rental, curb appeal, noise etc. will have to be managed
• The best of the best rentals, those large, well cared for, beautiful rentals will rise to the top, and there will still be competition if the rent rate is competitive - meaning far far less than landlords commanded in the past.

I think if you polled landlords you’d find very, very few rent for below their carrying cost. And among them lots are intending to move into the unit at some point and they’d rather have a majority of costs covered rather than none as the unit waits and sits. Others still are renting for six months at a low cost but high expectations in order to avoid paying the vacation/spec tax, but for that low cost the tenant is obligated to maintain the property, etc.

On the flip side, more landlords are going to place higher expectations on their tenants moving forward. Asking for proof of earnings and employment will become even more prevalent asks among landlords, as the old adage by experienced landlords (budget for 8 months of earnings per year over the long term) begins to ring true for fresh investors. This is why Kev is seeing landlords raising their rents as they get burned by the current situation and want to insulate themselves from a repeat scenario.

[Mike K.]

oh i agree that right now while 25 or 45% of people are laid off it's good pickings. plus who would move now you can just not pay your rent and you are fine. but when this passes i'm not sure it'll be as you describe.

No, it won’t be.

Landlords who didn’t have tenants at the beginning of March are unlikely to have tenants until May or June the way things are going. This is namely because people are not required to move from their current homes, are incentivized to stay with the rental subsidy, and for health reasons don’t want to move.

So naturally you will have landlords now going into Month 3 with no earnings willing to get whatever they can, but also keep in mind that the carrying cost for older rental suites is far lower than for new entrants that paid current real-estate rates for the property, in that they (landlords who bought in years prior) can afford to rent their full home/house rental for $2,500 while the guy next door needs $3,200 to cover all expenses as he paid $220,000 more for the home, or whatnot.

[mbjj]

A friend of my daughter's bought a large house about three years ago. There was a suite in the basement they rented out to university students and a small bachelor suite they used as an AirBnB. Now neither is occupied. They may have to sell the house. It's a shame as they did some redecorating and had it really lovely. Still had all the original woodwork and features in the living and dining rooms and the AirBnB was exquisitely decorated.

[Mike K.]

It’s all good, they should sell and buy something more manageable. There’s only so much time and dedication you can put towards rentals or AirBnBs and it can be quite stressful.

If they’ve got the work ethic to fix places up they’ll add their touch to a future home, and it’ll be just as wonderful as the current one, and perhaps with a $100k in the bank to help them not worry about odds and ends.

I’m a glass half full sort of a guy

[Victoria Watcher]

this 1910 apartment building is for sale.  built by francis verdier!

 

https://www.realtor....h-brentwood-bay

 

 

 

background here:

 

The house was originally built as a symbol of success for Francis (Frank) Verdier. Frank was the son of Etienne Verdier who, together with his brother Alphonse, was among the first settlers on the Saanich Peninsula.

 

Their story began in 1849 when, in their 20s, they left Toulouse, France, to head for California and the gold rush. Having no luck in the gold fields, they headed north in 1852 to Fort Victoria. Etienne found work driving a water cart for George Stelly, another Peninsula pioneer. Two years later he owned the business, supplying water to city residents. He married Honora Kilroy, an Irish girl who had arrived on the famous Bride Ship, the SS Tynemouth, in 1862. Eventually Etienne and Honora moved out to the Peninsula and settled on land near Alphonse who was also living there with his first wife, Anna, daughter of pioneer Angus McPhail.

 

Etienne and Honora lived on the George Stelly Farm where eldest son, Frank, was born in 1865. Frank grew up with First Nations children, learning their skills with bows and arrows as he hunted deer or trapped bears.

 

Later Frank Verdier (nicknamed “Big Frank”) was able to buy the Stelly Farm, renamed it Verdier Farm and eventually sub-divided this 60-hectare land into over 100 parcels. Frank became successful in many such real estate deals through the years and played a large role in the forestry industry of Vancouver Island. With a team of 12 oxen, he helped clear the Sooke Road and cut the first trail from Forbes Landing to Campbell Lake. He was most well-known for the part he played in mapping out the original route for the Malahat Highway. He also ran for Saanich Council in 1913.

 

https://seasidemagaz...ier-house-move/

Edited by Victoria Watcher, 18 April 2020 - 12:54 PM.

[spanky123]

 

It is happening right now - it's flipped. 

 

If you have time on your hands - have a look at the rentals currently available, pretend to be a potential renter, go through the motions and see what happens. 

 

3 of our personal and close friends:

one single, another a couple and not that it matters - LGBTTQ, and yet another single mom 3 children, 2 dog 

• all had several top choices
• all have secured rentals - their preferred top choice 
• rentals located in Oak Bay, Victoria and Saanich
• less rental rate (by 25%) than 3 months ago (all of them had been scanning rentals for many months) and;
• far easier for them to rent than they've ever had in their history of renting

 

 

I don't think that there is any evidence of a 25% drop in rental prices. I think that your friends were fortunate to find something that they like and afford.

 

These next few months may create some opportunities for good tenants as landlords will be reluctant to rent to anyone they think won't pay, but history has taught us that the net impact of huge liquidity injections as we are seeing now is asset bubbles and real estate has been the biggest bubble of them all. We may also find that even with a 15% foreign buyers tax, the quick recovery of the Chinese economy and the huge drop in the value of the Canadian dollar still make our real estate really cheap for foreign buyers.

[Mike K.]

And considering how few COVID cases we have in this country, there’ll be plenty of wealthy people looking to relatively remote regions like Vancouver Island to acquire a bug out property.

The world’s super elite, however, are choosing to build stately bunkers in New Zealand. Vancouver Island, in a way, isn’t much different and I wouldn’t be surprised if several high net worth individuals haven’t already built secret fortresses in our neck of the woods, and will continue to do so given how easy it is to cut this island off from the rest of society while all necessary services remain available.

[Casual Kev]

And considering how few COVID cases we have in this country, there’ll be plenty of wealthy people looking to relatively remote regions like Vancouver Island to acquire a bug out property.

The world’s super elite, however, are choosing to build stately bunkers in New Zealand. Vancouver Island, in a way, isn’t much different and I wouldn’t be surprised if several high net worth individuals haven’t already built secret fortresses in our neck of the woods, and will continue to do so given how easy it is to cut this island off from the rest of society while all necessary services remain available.

 

That's an interesting angle. Prince Harry and Meghan temporarily living in the peninsula probably caught the eye of some of the world's elite, and the lack of bridges to the island makes it relatively isolated compared to the rest of North America without being far from big population centers. That said, I don't think that would have much of an effect in the broader housing market outside of the luxury stuff. The high-end market in Vancouver had stalled before COVID and it had no repercussions on median prices.

Edited by Casual Kev, 18 April 2020 - 05:38 PM.

[VIResident]

Renting Just Got A Whole Lot Easier in Victoria

And it’s not because of the evictions ban

By Leo Spalteholz

 

April 29, 2020

  https://www.capnews....oria-spalteholz

 

"......Once the lockdown eases, it may not be a bad time to make a move."

 

(Landlords - get your rental charges in line fast, treat your tenants like gold and change your attitude)

Edited by VIResident, 29 April 2020 - 06:34 AM.

[Victoria Watcher]

that article attributes most of the potential vacancy to Uvic being out. but uvic is out every year. so I’m not so sure.

the article assumes uvic students are not returning until 2021 - presumably September 2021.

I’m also not so sure about that. universities are going to be under TREMENDOUS pressure to have students back this September (even if they limit classes or class sizes). If they don’t they are going to lose most of their international students. Which is massively devastating on their budgets.

Edited by Victoria Watcher, 29 April 2020 - 06:41 AM.

[Mike K.]

When a significant number (several thousand?) of UVic/Camosun students graduate and return to their hometowns or leave to pursue employment upon graduating it is indeed the best time to move. May-June, typically, then you’ve got newcomers arriving to scope out rentals and the madness begins once more.