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Victoria's residential rental market


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#1161 lanforod

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Posted 19 May 2021 - 06:59 AM

This is affecting small landlords too. I've sold mine, and am more and more less inclined to buy another; at the very least, I'm going to wait.



#1162 lanforod

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Posted 19 May 2021 - 07:03 AM

I'm saying if a landlord was paying the bills just fine with an $850 rent in 2019, at which point his tenant moves out, he's doing OK holding the line all year in 2021 at $1,100. 

 

Just seems sleazy to kick a family to the street just because your return on investment is less than it could be.

 

That's not the scenario. For many, they were renting at $1000 in 2019, and are still renting it for $1050 in 2021, because there hasn't been turnover. In the mean-time, costs have risen from $950 for that unit to $1064. Thats using approximate actual rent increase and cost increase percentages; it all depends on the starting numbers.

You see the incentive to sell now?



#1163 Mike K.

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Posted 19 May 2021 - 07:28 AM

And this is all while mortgage rates haven’t fluctuated up.

Housing has been mismanaged absurdly and now we’re getting a kick out of telling people we’ve run out of room for the most desirable form of housing, SFDs, by pretending the other 450 square kilometres of the CRD don’t exist, in addition to the other 30,000 square kilometres of wilderness on this island. Every news story claims, with sincerity, we’re running out of room.

If millennials truly want to own real-estate and I assume they do by the volume of social media content indicating homeownership is a top of mind goal, then they’ll have to stop working so hard at keeping themselves from acquiring it by promoting Langford as a far-flung suburb and the CRD as running out of room, and allowing experts who themselves live in suburban SFDs to be their lobbyists.
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#1164 lanforod

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Posted 19 May 2021 - 07:32 AM

And because existing rents haven't been allowed to rise, no one wants to move and lose the deal they have now, so turnover is reduced. The longer this continues, the worse it will get.



#1165 Mike K.

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Posted 19 May 2021 - 07:36 AM

Precisely. And what’s the NDP’s plan for 2022? Allow rental rates to rise at inflation +2% again? Highly unlikely.

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#1166 Victoria Watcher

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Posted 19 May 2021 - 07:36 AM

That's not the scenario. For many, they were renting at $1000 in 2019, and are still renting it for $1050 in 2021, because there hasn't been turnover. In the mean-time, costs have risen from $950 for that unit to $1064. Thats using approximate actual rent increase and cost increase percentages; it all depends on the starting numbers.

You see the incentive to sell now?

 

sell my house because I'm losing $14/mo.?

 

 i mean i understand.

 

and if would be different if you could stop renting the suite and your costs went way down.  but chances are you kick the tenant out and leave it vacant and you are not only losing that $1050 income but also have only reduced your costs a couple hundred.  your biggest expense is your mortgage payment and that's not changing depending on the occupancy of the suite.


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#1167 lanforod

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Posted 19 May 2021 - 07:37 AM

Plus now you'd have to pay the vacancy tax.



#1168 lanforod

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Posted 19 May 2021 - 07:38 AM

Also, it's illegal to kick without cause. Getting cause is next to impossible. 'Not making money on it' is not cause.


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#1169 Victoria Watcher

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Posted 19 May 2021 - 07:39 AM

Plus now you'd have to pay the vacancy tax.

 

no vacancy tax by leaving your basement suite fallow though.



#1170 lanforod

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Posted 19 May 2021 - 07:39 AM

no vacancy tax by leaving your basement suite fallow though.

Yet...


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#1171 Victoria Watcher

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Posted 19 May 2021 - 07:39 AM

Also, it's illegal to kick without cause. Getting cause is next to impossible. 'Not making money on it' is not cause.

 

yes.  that's crazy.  especially in your own house.



#1172 lanforod

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Posted 19 May 2021 - 07:40 AM

yes.  that's crazy.  especially in your own house.

 

In your own house its easier. You can just claim you need the space for your own use. If you rent it again right away though... not so much :)


Edited by lanforod, 19 May 2021 - 07:40 AM.

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#1173 Victoria Watcher

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Posted 19 May 2021 - 07:42 AM

In your own house its easier. You can just claim you need the space for your own use. If you rent it again right away though... not so much :)

 

oh I did not know you had that out.  I thought you'd have to renovate.  that's not as bad then.



#1174 Mike K.

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Posted 19 May 2021 - 08:04 AM

Just wait for the four and six-plex zoning Victoria is mulling. I can imagine taxes will be so high on those properties you’ll have to rent a portion of your home just to cover taxation.

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#1175 Rob Randall

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Posted 19 May 2021 - 08:30 AM

If your margins on your rental are so tight a few bucks forces you to boot your tenant maybe you're in the wrong business. This has been another lesson from the Peter Gustavson School of Business Management.


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#1176 Mike K.

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Posted 19 May 2021 - 09:15 AM

But it’s those landlords who provide a relatively sizeable amount of rental housing, and are usually more accommodating than professionally managed rental operators.

They are prepared to maintain a near-zero profit margin during their ownership of the property with profit emerging upon resale, but the way the NDP has handled the last three years these investments have turned into liabilities with uncertainty for the next two years. I mean, would you rent your suite $50 short of what it takes to maintain it, rising to $100, then $150/month, for the next three years? I don’t think you would.

So they are selling, and families buying them are glad they are selling.
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#1177 Mike K.

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Posted 19 May 2021 - 04:51 PM

Bloomberg, May 18th:

But despite the anxiety about irrational bidding wars and fears of the bubble bursting, what's fundamentally driving it is a worsening imbalance between supply and demand: Buyers want large homes but increasingly can’t have them because there isn’t enough space in and around the major cities where people work.

“Increasingly can’t have them because there isn’t enough space.” - https://www.bnnbloom...-land-1.1605274

The biggest lie of the 21st century.

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#1178 Victoria Watcher

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Posted 19 May 2021 - 05:05 PM

there isn't enough space that politicians and existing homeowners want to see developed for housing.

 

look at things like Bamberton here.  

 

sure the odd retired gravel pit will be developed here after all it was ugly.  but just try cutting a little bit of forest for a new community.


Edited by Victoria Watcher, 19 May 2021 - 05:07 PM.

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#1179 NinVic

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Posted 19 May 2021 - 08:04 PM

Precisely. And what’s the NDP’s plan for 2022? Allow rental rates to rise at inflation +2% again? Highly unlikely.

No, they've already removed the +2% factor.

 

So inflation only from 2022 onward. So really not great for Landlords,  insurance up 25% in 1 year and property taxes around 5 to 10%, natural gas bills (carbon tax) up more than inflationm but rents.. ~1 to 2% if you're lucky.

Carbon tax at $170/ton will double any natural gas bills over the next 10 years too, so I can see some landlords cashing out now. 

 

Better to get capital gains now at a lower tax rate than decreasing returns on your rents and also potentially higher capital gains taxes in 2-3 years on the sale of the rental property.  Let's not kid out selves, someone will be paying for all this government spending and capital gains increases are easily sold as a tax on the rich.


Edited by NinVic, 19 May 2021 - 08:08 PM.

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#1180 Matt R.

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Posted 19 May 2021 - 08:59 PM

Yuck. Who would want to be a small time landlord these days. Fine enough if you don’t have a mortgage or just a small one, but otherwise? No thanks.*

*some conditions apply, see store for details.

Matt.
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