Income Property

admin — Fri, 03 Feb 2012 00:20:15 +0000

Toronto Income Property Newsletter:February 2012

A few postings ago, Iwrote about being patient if you are looking to buy an investment property inCentral Toronto. I had no idea how truethis would be for the start of this New Year. Demand is still greatly outpacingthe current supply, and some of the recent sale prices have defied logic. Take a moment to check out the “Sold IncomeProperties” on the Plex homepage to see how the market has been performing inyour neighbourhood. If you would like tohave more detailed sales info on a specific area of the city sent to you,please send me an e-mail.

I’d like to wish allof you a Happy Valentine’s Day and if you are an NFL fan, all the best for agreat Super Bowl party.

The income propertymarket in Toronto has indeed started off this year with a bang. From everythingthat I have seen over the past three weeks, 2012 is looking a lot like lastyear – high prices, multiple offers and a lot of overall action. There’s nodoubt in my mind that the market is still favouring sellers and it will takelonger for most buyers to find quality plexes that make fiscal sense. We do expect more inventory to come on-linein the next few weeks, but the lack of suitable properties for January has beenvery frustrating.

Interest rates continueto be at all-time lows and it doesn’t seem like they are about to go up anytime soon. When you can lock in for fouryears at less than 3%, that’s going to help affordability and fuel a strongdemand. I also still believe that if themarket cools down as many experts figure will happen, the prices that we haveseen over the past couple of years will still hold. I do not anticipatea reduction in the prices of plexes in prime locations.

Onein six Canadian homeowners and investors who responded to a recent study saidthey planned on investing in property in the next two years. The study, commissioned by Re/Max, found thatsingle-home purchases were the most popular investment, followed by multi-unitbuildings, condominiums and townhouses. Of those who planned to invest in realestate, close to 30 per cent already owned a home and 43 per cent were underage 40. Michael Polzler, executivevice-president of Re/Max Ontario – Atlantic Canada Inc., once said Canadiansare by nature conservative investors and like the predictable returns realestate offers, even if they might be a better bang for their buck in equityinvestments. “It has an allure,” Polzler said. “You can write off your expenses and you know what you have.”

CarlGomez, an economist with Toronto-Dominion Bank, offers an opposite view. Hestates there has been a “big rush to real estate” in recent years, thanks torising prices, low interest rates and poor returns in equity markets, but he isnot convinced that trend will hold indefinitely. “People go where the returns are,” hesaid. “The tide might be turning.” If the tide does in fact start to turn, I’msure that we on the investment side of the Toronto market will see the signs well inadvance.

One factor thatcontinues to push sales of income properties is that we have a fantastic (readlow) vacancy rate. In my opinion, this is something that is not likely going tochange for some time. Some people think thatthere are tons of empty apartments out there, thus making investment propertiesan unsure bet. This is simply not the case – at least, not in the core of thecity. You may not get a crush of rentersin December or January, but once the snow clears, there are always renters outthere.

The vacancy rate inthe fall of 2010 was around 1.8%. The Toronto Shelter, Support and HousingAdministration published that 579,010 households in Toronto are rentals. I hada client call me last month looking to rent a two bedroom and wanted to spendaround 00 a month. I couldn’t findanything on MLS or on www.viewit.ca so I called a few clients who I knew hadmulti-unit buildings. No one had anyvacant units. When I show incomeproperties to clients we do see vacant suites. In many cases though, the owner chooses not to rent it out, in case thebuyer would like that suite. It’s also awkward to tell a new tenant that thebuilding is for sale – it sometimes makes the renters feel nervous.

Someanalysts see downward pressure on rents should the market level off. “The volume of incentives has softened a bitand landlords are pulling some of them off the table, such as free rent, freeparking, or renovations. This is goodnews for real estate investors.” quotes a CMHC source.

Averagerents in Toronto held steady between 2010 and 2011 and are virtually unchangedsince the late 2000s, says a report by Clayton Research Associates Ltd. Aggressive recruiting of tenants helped fill vacantunits. Even better times may be aheadfor landlords, because of continuing strong immigration and a widening gapbetween renting and owning. “Overall vacancy rates will decline over the mediumterm,” the report concludes, “thereby allowing landlords to pass rent increasesthrough more easily in the future.” Interestingly enough, rental rates haven’t gone up that much. A 2-bedroom apartment rents at an average of1395.00 per month and this number has by and large been the same for a fewyears now.

Takea look at the following vacancy rates in this chart provided by CHMC.

Private Apartment Vacancy Rates (%)
	2007	2008	2009	2010
Barrie	3.2%	3.5%	3.8%	3.4%
Brantford	2.9	2.4	3.3	3.7
Guelph	1.9	2.3	4.1	3.4
Hamilton	3.5	3.2	4.0	3.7
Kingston	3.2	1.3	1.3	1.0
Kitchener	2.7	1.8	3.3	2.6
London	3.6	3.9	5.0	5.0
Niagara Region	4.0	4.3	4.4	4.4
Oshawa	3.7	4.2	4.2	3.0
Ottawa	2.3	1.4	1.5	1.6
Peterborough	2.8	2.4	6.0	4.1
Sudbury	0.6	0.7	2.9	3.0
Thunder Bay	3.8	2.2	2.3	2.2
Toronto	3.2	2.0	3.1	2.1
Windsor	12.8	14.6	13.0	10.9

It is interesting to see how Toronto compares to otherOntario towns. Clearly, while somecities have seen the vacancy rate increase over several years, in Toronto thathasn’t been the case.

Who’s Looking For Phoenix Homes?

admin — Wed, 01 Feb 2012 19:18:21 +0000

Looking at stats is fun and often very enlightening. I use Clicky for tracking websites amongst others in case you’re wondering about the display below.

One of the interesting things is where are visitors coming from. This is also indicative of where many buyers and investors are from. In this snapshot we’re only focusing on U.S. and Canadian visitors over the last couple of months. All these are individual ip addresses so repeat visitors are, for the most part, not here, nor are my visits which I block.

Besides the obvious Arizona visitors, California takes second place as is expected. Californians buy a lot of property there. Next are Canadian visitors. 11.2% of visitors are from Canada. You can see where Canadians are buying in Greater Phoenix here.

Notice how many visitors are from the colder areas of the U.S.

Monthly Median Sales Price of Phoenix Residential Properties Over 10 Years

admin — Tue, 31 Jan 2012 14:10:35 +0000

Start by looking at the right end of the graph below in the present where it is clear by the graph and the activity in the market that prices have stabilized and many cases are on the rise without any foreign influence: by that I mean government incentives like the tax credits we had a few years ago, which did nothing, but artificially bump the market before it corrected itself after the incentives were removed.

Those are gone and prices are almost naturally coming back and improving. It’s good to see this finally.

View Similar Properties In Each Phoenix Listings Detail Page

admin — Tue, 31 Jan 2012 14:10:34 +0000

We’ve just added a new feature to each listing details page, that shows similar properties to the one being viewed.

The listings are shown at the bottom of the detailed property sheet. There are 4 initial similar listings and you can easily see more, by clicking on the blue button titled ‘View all similar properties here’

I hope you find this new feature a benefit, something that will make your Phoenix homes search much easier and efficient.

How To Differentiate Your Rental Apartment From The Competition

admin — Mon, 30 Jan 2012 09:05:45 +0000

I deal with a lot of tenants when leasing out my own properties and sometimes for clients who have purchased properties, but on a limited basis. Since I get to talk to a lot of potential tenants I know what they like and what turns them off.

The basics are important, “good” neighborhood, access to jobs, shopping and freeways: the size and amount of bedrooms are all important, but those are things many apartment communities share so the competition is similar to our offerings, but there is something, amongst smaller property owners, which makes it easy to compete against and that is the condition of the units.

One of the most common themes that comes up in my conversations with potential tenants is the quality and cleanliness of other properties they have seen, both houses and apartments.

The overall assessment is that many owners don’t prepare the properties for new tenants. They leave them dirty and that turns off most good tenants.

If your place is clean it will have an advantage over the competition. Anyway why would you want to lease out a dirty property? Some owners I’ve spoken with say that, ‘tenants will mess them up anyway’. That is not true. It is true that if you put a dirty property up for lease then, it is likely that what you’ll get is a dirty and grimy tenant that will match your style of cleanliness. Dirty apartments attract dirty tenants.

That means you need to get the apartment really clean, inside and out, especially in all the nooks and crannies, and get rid of any nasty smells or mildew smell that may be present. Nothing will differentiate your place like cleanliness.

By the way. The same goes when selling your home. It needs to be clean.

Arcadia Lite A Neighborhood Between The Giants

admin — Thu, 26 Jan 2012 17:34:30 +0000

A wonderful small neighborhood with ranch homes, palm trees, lots of character and a strong sense of community.

The Biltmore, Arcadia or the Camelback Corridor it’s not. This area is in disputed territory, no one knows where it belongs. Now at least it’s a bit clearer. This is Arcadia Lite.

While not Arcadia proper the sentiment is more toward the east then west. Arcadia Lite is bound by Campbell to Indian School and 32nd St. to 36th St. The name has been around while but only recently did the street signs receive that added neighborhood sign as pictured above. There are about 500 homes represented in this neighborhood.

They are mostly ranch homes of medium size from the mid century and many remodeled homes. While still in a transitional phase the trends are good. Some of the homes are simply beautiful and it seems that residents care to preserve the character of the area and it’s architecture. The neighborhood is between Arcadia and the Biltmore each of which offers a lot to its residents from jobs, shopping, dining, culture and nearby the Phoenix mountains.

Home range from the mid 0,000 to near half a million.

Arcadia Lite Homes For Sale

#arcadia-lite-homes-for-sale#

A Short Annual Review Of 2011 Greater Phoenix Real Estate Market

admin — Thu, 26 Jan 2012 17:34:30 +0000

2011 was certainly an interesting year overall, but then again I have yet to see a year that was not. I’m not going to say too much about the year: I’ll let the numbers speak below and you can always hit the archives to read the month by month plays.

What is clear is that 2011 was a busy year, especially when you compare it to 2008 when only 58,388 properties sold.

Take a look at how attached properties took off, especially condos and townhomes. Sales went up much more then the market overall: 2011 compared to 2008.

Lender Owned Sales

Bank owned sales were above 2010 levels, but 10K units less then 2009. 2011 was a big year for REO properties mostly because more people had confidence in the future of the economy and real estate values so these were literally scooped up.

Short Sales And Pre-Foreclosures

Short sales are one of the reasons we had fewer REO properties on the market. Many lenders prefer short sales to foreclosures for a multitude of reasons which I have covered before.

Normal Sales

The big news is that normal sales, rocked. 34,366 normal sales were recorded. That is whole bunch more then the previous years.

Trustee Notices and Trustee Sales

Notices of trustee sales or foreclosure notices were down a whole bunch compared to 103,341 in 2009 and even 2008 or 2010. Trustee sales too went down, partially because third party buyers took some of the slack. Good stuff.

New Home Sales

Not surprisingly new home sales were in the hole at 5,927 units. Look at the previous years for comparison. They did pickup toward the end of 2011 as overall inventory took a nose dive and demand grew.

But, that’s all in the past: let’s get back to the now and focus on the future.

House Prices Lowest Since 2000…

admin — Wed, 25 Jan 2012 12:24:30 +0000

House prices now under €200k, lowest since 2000…

HOUSE prices in Dublin have fallen below the €200,000 barrier for the first time since the early months of 2000.

Values fell by almost 17pc last year – the fastest annual decline in almost two years, official figures have revealed.

The average cost of a home is now about €165,000 based on prices at the peak of the property boom in February 2007 while in Dublin prices have fallen to €198,260.

The Central Statistics Office (CSO) has reported prices down by 47pc in the last five years.

On top of that huge crash, the record for December shows house prices falling at their fastest rate since February 2010 and a steady increase in the rate of decline all through 2011.

The average price paid for a house nationally in February 2007 was euro €311,078, while in Dublin it was €431,000, according to the accepted report on mortgage drawdowns by Permanent TSB.

Based on those figures and the CSO’s rate of decline, average prices in the capital are now just below the €200,000 barrier.

House prices have fallen so much they have now reached affordable levels for thousands on average salaries, a major new study claims.

The first of its kind, the global survey found it now takes the equivalent of little more than three times the average salary to buy a house here.

That compares with 10 times the average salary of €36,000 a year during the boom.

The price plunge puts houses within reach of teachers, nurses, gardai and office workers for the first time in years.

But with the prospect of further price falls and banks refusing mortgages to many applicants, the latest findings are unlikely to spark a major lift in demand.

Nonetheless the comprehensive snapshot of the market provides a critical insight.

The study is part of a major international examination of prices in cities across the globe.

It was carried out by the prestigious Demographia International Housing Affordability Survey.

Its experts looked at 325 cities in English-speaking countries such as Australia, New Zealand, the UK, the United States, Canada, Hong Kong and Ireland.

It found housing in Waterford to be the most affordable followed by Galway, Cork, Dublin and finally Limerick.

Wendell Cox, principal of the Illinois-based Demographia said: “The bubble is over. Prices have continued to decline. We have housing prices back to where they’re supposed to be.”

The definition of affordable is that houses cost around three times the annual income of people living in the city.

This makes Dublin more affordable than Limerick, despite higher prices in the capital.

Galway and Waterford were the first cities outside North America to be rated affordable in the eight-year history of the Demographia International Housing Affordability Survey.

Assuming an average price of €150,000 and a saved deposit of 20pc (€30,000) a prospective buyer would have to borrow €120,000 which is a little more than three times the average earnings.

The findings may put more pressure on banks to acknowledge the new reality and start giving out more mortgages.

Only €2bn worth of mortgages was given out last year — compared with €30bn mortgages at the height of the boom.

Auctioneers now estimate that one in three house are sold for cash and do not involve a mortgage.

But moves by Finance Minister Michael Noonan in last month’s Budget to hike the amount of mortgage tax relief for first-time buyers taking the plunge this year may help stabilise the mortgage market, experts have said.

Bank of Ireland and AIB have both committed to lending more to new buyers, while Permanent TSB cut its lending rate for new buyers with effect from yesterday. It was the first cut in its new customer lending rate in four years.

Ireland was also the only nation without cities listed in the severely unaffordable category. Waterford, at 2.8 times, was the most affordable city among the five Irish cities surveyed followed by Galway (3), Cork (3.3), Dublin (3.4) and Limerick (also 3.4).

In contrast, the index was 12.6 in Hong Kong, by far the priciest market. And Canada, despite being larger in size than the United States with just one ninth of the population, continues to grow less affordable.

Report by Ed Carty, Thomas Molloy and Charlie Weston – Irish Independent

Ireland Property – Daft Property – http://daftproperty.blogspot.com

Multifamily Shows Strong Prospects For The Next Few Years

admin — Tue, 24 Jan 2012 07:21:31 +0000

An indication of the popularity of multifamily properties is the obvious lack of inventory and the activity when decent properties do hit the market. There is no doubt, small multifamily properties are popular with real estate investors.

The 2-15 unit complexes did get hit pretty bad. There was a lot of speculation, what seems like many years ago in 2003-2007. Many of these properties shot up sky high in price and found willing buyers. Of course, as we all know, most of these came crashing down and went through the arduous short sale or REO process to new owners who often got them at mid 1980′s to mid 1990′s prices and pretty much instant awesome returns.

The larger complexes in the commercial realm never really hit on bad times. What did happen is that construction of new units went down dramatically so rental demand for what was left was pretty high. Also some of the larger complex owners were able to more easily restructure loans, though I know a few owners who, through some diligent work were able to do the same with their fourplexes, but those are rare cases.

I got a little off track, though.

A recent report titled ‘The Year Ahead, Real Estate’s Best Bets in 2012′ by Robert Freedman and Nichole Odijk DeMario in the Realtor magazine, indicates the following trends.

2011

Vacancy rate: 5.4% | Rental rate change: 2.5% | Net Absorption: 238,398

2012

Vacancy rate: 4.6% | Rental rate change: 3.5% | Net Absorption: 126,621

2013

Vacancy rate: 4.5% | Rental rate change: 3.8% | Net Absorption: 102,687

They also note:

“Apartment rentals are once again expected to be the best-performing commercial sector.”

How Far Is It From This Home To…

admin — Sat, 21 Jan 2012 20:09:50 +0000

One of the cool easily accessible tools within the Phoenix homes search is the map section.

The map section shows you where the homes is on a live active map. But there is more.

You may want to know how to get from your current home to this home.

You may want to know the distance from this potential new home to your job, family or favorite park.

You want want to know one one of several of these things. In fact it should probably be part of your due diligence when vetting home for your short list.

Well you can.

Each listing has a map and directions tab. At the bottom of the page you can simply put in your ‘from’ address and voila, you’ll get a map of the route and distance.

It does not have to be an address. For the sample to the right, I picked a random listing and chose the Phoenix Children’s Hospital. So you can put in the address or location or other name place.

Search Phoenix Homes Now.