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Rental housing Q&A with Devon Properties


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#1 Mike K.

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Posted 11 May 2018 - 10:29 AM

We'll be starting a monthly Q&A component on Citified with professionals related to the commercial real-estate market, business related to real-estate and industry input on local issues or themes.

 

The first one will be a segment with Devon Properties, which is Victoria's largest rental housing management firm. The questions/answers will apply to industry professionals and consumers alike, and I'd like to open up the question suggestions to you all.

 

The Q&A segments will be comprised of 10 questions and input on the questions will also be generated through our relationship with CBRE, so unfortunately not all questions will be able to make it into the Q&A but we'll select them from those that you provide below.

 

There's no such thing as a stupid question, please don't hesitate to posit yours.


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#2 VicHockeyFan

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Posted 11 May 2018 - 11:06 AM

Not including land acquisition costs, what is the per sq. ft. cost of building a new apartment building today, with VERY modest finishing, and small suite sizes?  No elevator, wood-frame 3 or 4 storey.


Edited by VicHockeyFan, 11 May 2018 - 11:07 AM.

<p><span style="font-size:12px;"><em><span style="color:rgb(40,40,40);font-family:helvetica, arial, sans-serif;">"I don’t need a middle person in my pizza slice transaction" <strong>- zoomer, April 17, 2018</strong></span></em></span>

#3 Sparky

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Posted 11 May 2018 - 12:00 PM

Ok. What is an appropriate deposit that a renter could expect to pay to a landlord upon the start of a tenancy of a single family dwelling?

How is interest determined on that deposit?

#4 Sparky

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Posted 11 May 2018 - 12:02 PM

^^ I am not sure that Devon is the right company to ask about construction costs. I think Mike is looking for rental related questions.

#5 Matt R.

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Posted 11 May 2018 - 12:11 PM

Ok. What is an appropriate deposit that a renter could expect to pay to a landlord upon the start of a tenancy of a single family dwelling?
How is interest determined on that deposit?


??

Deposit is still one half months rent and interest is nil.

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#6 VicHockeyFan

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Posted 11 May 2018 - 12:15 PM

^^ I am not sure that Devon is the right company to ask about construction costs. I think Mike is looking for rental related questions.

 

I'm sure they consult on apartment-building too.


<p><span style="font-size:12px;"><em><span style="color:rgb(40,40,40);font-family:helvetica, arial, sans-serif;">"I don’t need a middle person in my pizza slice transaction" <strong>- zoomer, April 17, 2018</strong></span></em></span>

#7 VicHockeyFan

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Posted 11 May 2018 - 12:18 PM

Ok. What is an appropriate deposit that a renter could expect to pay to a landlord upon the start of a tenancy of a single family dwelling?

How is interest determined on that deposit?

 

By law, it cannot be more than 1/2 month's rent, or up to double that if you ask for a pet deposit.  You can charge as little as you want.

 

The minimum interest has been zero since 2009. You could pay more if you want.


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<p><span style="font-size:12px;"><em><span style="color:rgb(40,40,40);font-family:helvetica, arial, sans-serif;">"I don’t need a middle person in my pizza slice transaction" <strong>- zoomer, April 17, 2018</strong></span></em></span>

#8 Casual Kev

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Posted 11 May 2018 - 12:22 PM

Positing a bunch of questions in case we don't have enough eligible ones. 

 

1. Are there any plans on the horizon for large-scale renovation or redevelopment of older wood-frame apartment buildings? Most of them were built decades ago and are nearing the end of their lifespan. 

 

2. How much of an issue are rental increase restrictions for landlords today? Seems like there's a growing disparity between what new and incumbent tenants pay, even within the same rental building.

 

3. How difficult it is to build new rental buildings in the CRD, assuming financial backing has already been secured? 



#9 VicHockeyFan

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Posted 11 May 2018 - 01:40 PM

1. Are there any plans on the horizon for large-scale renovation or redevelopment of older wood-frame apartment buildings? Most of them were built decades ago and are nearing the end of their lifespan. 

 

I'm not sure that's true.  Around here, most houses last easily 50, 70, 100 years.    


<p><span style="font-size:12px;"><em><span style="color:rgb(40,40,40);font-family:helvetica, arial, sans-serif;">"I don’t need a middle person in my pizza slice transaction" <strong>- zoomer, April 17, 2018</strong></span></em></span>

#10 Rob Randall

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Posted 11 May 2018 - 02:18 PM

What is Devon's long-term plan for non-smoking buidings? I know some buildings like The Meadows are non-smoking and some like Seaview Towers are transitioning to non-smoking. Does that mean smokers are grandfathered and will be allowed to smoke for as long as they are a tenant? Is Devon able to respond to complaints about "excessive" smoke that bothers other tenants in its smoking buildings?


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#11 sdwright.vic

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Posted 11 May 2018 - 02:25 PM

I'm not sure that's true. Around here, most houses last easily 50, 70, 100 years.


But I thought a large portion of rental stock was coming to the end of its life?
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#12 VicHockeyFan

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Posted 11 May 2018 - 02:27 PM

In times of low vacancy rates, why doesn’t Devon operate rents for new tenants on a “bid” basis to maximum rent revenue? Similarly, why not the same for softer periods, where people can bid for lower rents.
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<p><span style="font-size:12px;"><em><span style="color:rgb(40,40,40);font-family:helvetica, arial, sans-serif;">"I don’t need a middle person in my pizza slice transaction" <strong>- zoomer, April 17, 2018</strong></span></em></span>

#13 Rob Randall

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Posted 11 May 2018 - 02:29 PM

^Easy, because you don't necessarily want the highest bidder living in your building.


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#14 VicHockeyFan

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Posted 11 May 2018 - 02:39 PM

^Easy, because you don't necessarily want the highest bidder living in your building.


“All other criteria being equal” you do. That’s how all hotels work.

Edited by VicHockeyFan, 11 May 2018 - 02:39 PM.

<p><span style="font-size:12px;"><em><span style="color:rgb(40,40,40);font-family:helvetica, arial, sans-serif;">"I don’t need a middle person in my pizza slice transaction" <strong>- zoomer, April 17, 2018</strong></span></em></span>

#15 lanforod

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Posted 11 May 2018 - 03:11 PM

What is Devon's long-term plan for non-smoking buidings? I know some buildings like The Meadows are non-smoking and some like Seaview Towers are transitioning to non-smoking. Does that mean smokers are grandfathered and will be allowed to smoke for as long as they are a tenant? Is Devon able to respond to complaints about "excessive" smoke that bothers other tenants in its smoking buildings?

 

Further to this, how is Devon dealing/planning to deal with marijuana smokers, both recreational and medical?


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#16 Casual Kev

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Posted 11 May 2018 - 03:32 PM

I'm not sure that's true.  Around here, most houses last easily 50, 70, 100 years.    

I mentioned it off an older Citified article that highlighted discussions at a landlord roundtable. 

 

https://victoria.cit...cement-by-2025/

 

As for why don't landlords change prices like hotels - because you want predictability and security from long-term tenants. A high-paying but poor tenant (noisy, late night partier, no good references, etc.) might not keep up with rent, cause major damage to the unit (maybe even other units with smoking or bug infestations) and reduce QoL for other tenants, bringing down rents. So landlords tend to not charge too far above the market so that they can have multiple candidates to choose from. Besides, rents don't change seasonally like hotel rates - people need shelter whether it snows or shines.

 

On the other hand, you run a hotel with the presumption that people do very different things in a short-term but will pay way more per night than in a long-term unit (vacation and business, mostly). You also capture the revenue from the unit before a guest uses it, maybe months in advance. You mitigate rowdy guests by having a whole infrastructure that keeps units clean and ready to go for the next guest. And unless it's REALLY bad,  guests aren't going to ask for a refund over behavior from other guests. So hotels don't really need to screen guests and charge whatever the market can bear at any given moment. 



#17 VicHockeyFan

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Posted 11 May 2018 - 03:38 PM

I don’t see any possible way that on balance, high paying tenants would be worse than low paying ones, in terms of damage or nuisance or whatever.
<p><span style="font-size:12px;"><em><span style="color:rgb(40,40,40);font-family:helvetica, arial, sans-serif;">"I don’t need a middle person in my pizza slice transaction" <strong>- zoomer, April 17, 2018</strong></span></em></span>

#18 Casual Kev

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Posted 11 May 2018 - 05:04 PM

I don’t see any possible way that on balance, high paying tenants would be worse than low paying ones, in terms of damage or nuisance or whatever.

 

Because you want to weight candidates against other ones. A landlord can just advertise a much higher rent than usual, then work his way down until he starts getting multiple applicants. He doesn't have to handcuff himself by having to pick a single candidate through a bidding process. The fit matters due to the aforementioned reasons, and in a low vacancy setting it's highly unlikely you'd have only one candidate willing to pay similar above-market rents. 



#19 VicHockeyFan

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Posted 11 May 2018 - 05:10 PM

The bidding process can include the bidder submitting other criteria. This is all about me, my references etc., and also here’s what I’ll pay.

They will still get as many or more applications as the old system. Plus it can all be done online, if advertisers would use better/more photos, plus floor plans.

Devon runs a fancy website buys it’s ridiculously short of photos etc. After 40 years of renting some buildings you’d think they’d have been able to take some photos and dimensions of individual suites. Air BnB model.

Edited by VicHockeyFan, 11 May 2018 - 05:15 PM.

<p><span style="font-size:12px;"><em><span style="color:rgb(40,40,40);font-family:helvetica, arial, sans-serif;">"I don’t need a middle person in my pizza slice transaction" <strong>- zoomer, April 17, 2018</strong></span></em></span>

#20 Mike K.

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Posted 13 May 2018 - 05:33 AM

Thanks everyone, keep them coming.

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