1451 replies to this topic

[spanky123]

Ontario company is looking to purchase $1bn of single-family homes as rental inventory, a lucrative practice in the States that hasn't taken off in Canada. They're looking at property in Ontario, Quebec, BC, and the maritimes.

Via https://www.theglobe...mily-houses-in/

 

The reason why it hasn't taken off here is because the rent you need to charge $5,000 a month rent for the average house in Victoria just to get a marginal rate of return! 

[Mike K.]

it's quite something that in the country that is #185 in the world for population density we have somehow made finding property to build a house on so difficult and expensive.

 

It truly is staggering.

[spanky123]

See, this is what happens when you decry and protest single family home development. 

 

It is what happens when you drive interest rates to zero and create enormous asset bubbles that people can capitalize on.

 

Having said that, if you think housing prices here are expensive check out Singapore. This recent sale was for about $4,000 (CAD) a sq ft. Oh and by the way that was per sq foot of bare land on which you can build a bungalow!

 

https://www.business...ces-keep-rising

Edited by spanky123, 14 June 2021 - 12:34 PM.

[spanky123]

it's quite something that in the country that is #185 in the world for population density we have somehow made finding property to build a house on so difficult and expensive.

 

There are lots of inexpensive houses and cheap places to build in Canada. The problem is people want a place to live in the handful of expensive places. I would love to have a house in Singapore or Monte Carlo. The difference is that I don't walk around believing that I have a right to one for $750 a month.

[Jackerbie]

^ Singapore is an odd case as 80% of households are in public housing. Interesting place to live though, I miss it sometimes!

[Mike K.]

It is what happens when you drive interest rates to zero and create enormous asset bubbles that people can capitalize on.

 

We're in decade #3 of this asset bubble, though, and to get into this asset bubble you have to qualify as though you are paying an interest rate just below where it averaged in the 1990s as a variable rate, so we're actually operating as though we're in decade #4 of this asset bubble. At some point we have to acknowledge that what we might have surmised was a bubble in 2005 is perhaps the new normal 15 years on.

 

And this is all made possible by the intergenerational wealth transfer courtesy of wealthy boomers.

[Mike K.]

A friend told me over dinner recently that a few years ago, BC Assessment began to assesses the value of multi-unit residential rental properties differently and that rental buildings are now being valued at the income that they could be earning rather than the income that they are earning.

What this means is that even if a building owner is charging tenants rents that are below market, their buildings are now assessed / valued at how much they would be worth if they were charging market rents. For example, if a building owner has tenants that have lived in a building for a long time and are paying less than what they would if they moved in today, or if a building owner supports a single mom with kids by giving her a break on rent, their buildings are still valued at the maximum rents they are able to charge. They are penalized for providing below-market housing.

How is having a building that is “worth more” a penalty? Because as the assessed value of a building goes up, this means property taxes for that building go up and the below market rents can’t cover the property taxes. My friend tells me that some of his friends – long-time building owners – are putting their buildings on the market because they can’t afford to keep them more affordable.

These buildings are being snapped up by Real Estate Investment Trusts (REITs), the mandate of which is to deliver as high as possible rate of return to their investors. Some of the investors in REITs are public sector pension corps. We want teachers and nurses and city workers to have good pensions; but we also want them to be able to afford housing now.

- https://lisahelpsvic...of-inspiration/

[Victoria Watcher]

she's such a simpleton.

 

i'm going to let my kids live in my $2.5M 2nd house.  for free, give them a real strong break on rent.  would she like to drop the property tax?

Edited by Victoria Watcher, 20 September 2021 - 04:18 AM.

[TallGuy]

When completed, there will be homes for approximately 40 more people than the current site offers. Seems like a no-brainer to me.

Not for those living there paying below market rates. If they get grandfathered rates in the new building, then it's a no brainer.

[Nparker]

More people will have homes afterwards. Net gain.

[Victoria Watcher]

Why should they get grandfathered rates?

[Nparker]

Why should they get grandfathered rates?

I can assure you my property taxes have never been grandfathered.

[corvus]

Seems a bit hypocritical to decry the anticipated renoviction concerns and then immediately dismiss grandfathered rental rates - is that not then exactly renoviction?

[Victoria Watcher]

It's not "renoviction".   It's a private property owner updating their holding and being unable to do so with tenants in place must ask them to leave, under all applicable rules, including compensation.

 

He's literally asking to knock the building down.  Hard to work around the tenants.

[aastra]

We all knew this issue was going to loom large eventually. I'll give an astute VV forumer credit for calling it out back in 2016:

 

 

May 24, 2016:

Methinks Victoria's greatest development controversy is yet to come, when those hundreds and hundreds of post-war apartment blocks come due for replacement. Actually, we might already be in the early stages of the process.

Edited by aastra, 13 December 2021 - 01:01 PM.

[Casual Kev]

We all knew this issue was going to loom large eventually. I'll give an astute VV forumer credit for calling it out back in 2016:

 

Yep. These buildings are the backbone of rentals in town, but it's infinitely easier for a rental building owner to sell it to a developer who will then replace it, than it is to buy SFH land with the intent to rezone into apartments. 

[Victoria Watcher]

Yep. These buildings are the backbone of rentals in town, but it's infinitely easier for a rental building owner to sell it to a developer who will then replace it, than it is to buy SFH land with the intent to rezone into apartments. 

 

Wouldn't you be renovicting the occupants of the SFDs on that land?

[corvus]

It's not "renoviction".   It's a private property owner updating their holding and being unable to do so with tenants in place must ask them to leave, under all applicable rules, including compensation.

 

He's literally asking to knock the building down.  Hard to work around the tenants.

Well, sure, but that IS renoviction. The end result is more density, and of course you can't knock down a building with tenants still inside of it, but when those tenants are turned out into a rental market that is accelerating much faster than any metrics of wages, with compensation that doesn't begin to cover their increasing costs from that eviction...that's a renoviction, with a significant hardship to the tenant. I don't think it's constructive to pretend that's a trivial impact. 

[Nparker]

The other option for owners of aging rental properties is to simply let them fall into ruin, since they cannot recover the costs of renovations.

[Victoria Watcher]

Why is there always an assumption that (in this case) those poor 15 tenants have nowhere else to go, no means, no savings, no family, no options?

 

They will be fine.