http://www.thegridto.com/life/real-estate/rental-illness/

http://www.moneyville.ca/article/1064037–bidding-wars-erupt-for-prime-rental-condos?bn=1

The market for rental condos is becoming almost as hot as Toronto’s resale housing market with bidding wars breaking out among tenants trying to snag prime units.

While some 21,000 units are now under construction in Toronto — 5,707 of them in the downtown core — demand for rental condominiums continues to far outstrip supply, housing experts say.

That’s driving some tenants to offer up to six months’ rent in advance, or more rent than condo-owners are asking, especially for increasingly rare two-bedroom units. Continue reading →

Susan Pigg – Toronto Star – September  28,  2011

Note: to see  the video and article click here.

Toronto Councillor Adam Vaughan can tell the minute he looks at a condo building in his downtown ward if it’s full of renters or home to owners.

“The bigger the building, the higher the rate of renters,” says Vaughan.

The optics can be even more obvious when he steps inside. Even newer buildings can have the feel of university dormitories with shabby lobbies and cheap carpeting meant to keep down maintenance costs for investors who own a unit or two but may live half a world away.

With Toronto’s condo market among the hottest in the world right now — almost 68,000 new units are now in the planning stages or under construction across the GTA — investors are cashing in big time on what looks like a sure bet compared to battered stock markets. Continue reading →

I know a small landlord who had a tenant without insurance. The tenant caused a fire – you know the rest. Although the landlord was covered with his own insurance, the payment of the claim would have meant in an increase in his premiums (possibly on all all the properties insured under that policy. For your protection as a landlord it is essential that you require all your tenants to provide proof in insurance before they take possession of your property.

When you describe this requirement to a prospective tenant it is essential that you describe it as being for their benefit. See the following article from the Toronto Star: Continue reading →

Canada’s housing market is in a bubble that’s set to burst and prices could plunge by as much as 25 per cent, a major independent research firm warns.

“Housing valuations have lost all touch with fundamentals and household debt is at a record high,” economists at the research consultancy Capital Economics say in their most recent Canada Economic Outlook, issued Wednesday.

“Our fear is that, with the housing bubble now close to bursting and commodity prices retreating, Canada will go from leader to laggard.”

The report predicts a fall in house prices by as much as 25 per cent over the next three years. Continue reading →

Sell your house and rent: If you’re a baby boomer entering retirement, that could be the financial move of a lifetime.

The case for selling the family home starts with the fact that years of strong price increases have hugely increased the value of homes across the country over the amount paid for them. What to do with the proceeds after you sell? Invest them conservatively and rent your next home.

More related to this story

• Six signs it’s time to buy a house
• Monthly home ownership costs higher than renting
• The pitfalls of buying a foreclosure house

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The optimist’s view on housing

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Where to buy U.S. real estate

Video

Preparing for bigger mortgage payments

Rushing into the market today only makes sense if you’re willing to buck convention and rent. If you buy again, you could reap big profits from your current home and overpay for your next.

Understand, this is not a doomsday call on the Canadian housing market. It’s just an argument that we’ve seen a ton of upside in house prices and that the next few years may bring incremental further gains or some downside.

Selling now can be a way of removing risk from your financial future, says Ted Rechtshaffen, president of the financial advice firm TriDelta Financial. If you own a house, a big piece of your personal wealth is tied up in one sector and in one region.

“The only way to capitalize on what your house is worth today is by selling today,” Mr. Rechtshaffen said.

There are definitely benefits to downsizing and buying a smaller home or condo rather than renting. There’s a far better selection of condos and houses for sale than for rent. Psychologically speaking, many people have a bias against renting because it’s seen as giving up control and living without roots.

There’s also the argument that renting isn’t financially smart, but it doesn’t hold up well for aging baby boomers.

Mr. Rechtshaffen says his firm’s long-term financial planning models use a 4-per-cent average annual gain for house prices and a 6.5-per-cent average annual gain for a diversified non-registered investment portfolio. Those are pretax numbers, of course. Sell a principal residence and you pay no taxes on your profit.

You can rig an investment portfolio to be fairly tax-efficient by focusing on dividends and capital gains, but you’ll still get dinged to some extent by taxes. So estimate a 5-per-cent after-tax return from investments, Mr. Rechtshaffen suggests.

Now for living costs. You’ll have no mortgage payments if you buy, but you’ll pay property taxes and face upkeep costs that can be steep if you have an older home. Renters pay rent and the same utilities as owners. How does it net out? Mr. Rechtshaffen estimates renters paying $1,500 a month may find they’re spending only $700 or so more than owners on a net basis.

Financial planner Rona Birenbaum said she’s talked to clients about selling a house and renting, but mostly in situations where money is being spent faster than anticipated and there’s a need to unlock equity in the home.

Selling a house for many hundreds of thousands of dollars and then investing that money safely can make you feel financially secure, Ms. Birenbaum said.

“That’s the plus side of doing this,” she added. “The minus is there’s a great temptation to encroach on that capital. It requires a fair amount of discipline in how you manage your cash flow.”

Still stuck on downsizing into a smaller home or condo? So are a lot of your peers, which is why downtown condos are no bargain. The average price for a resale condo in Toronto was $326,750 in the first two weeks of this month, according to the Toronto Real Estate Board. Laurin Jeffrey, a Toronto agent, said $600,000 is a good ballpark amount for a nicely situated downtown condo.

If you buy a condominium, prepare yourself for stiff condo fees (include day-to-day maintenance, property management fees, amenities such as a swimming pool and workout room, cable TV and contributions toward a reserve fund to be used for major repairs). I’ve heard two stories in the past couple of weeks about people planning to move out of condos as a result of fee increases or special levies for maintenance. “There’s no rent control on maintenance fees,” Ms. Birenbaum said.

Your age may also play a role in determining whether it’s better to buy or rent after selling the family home. Mr. Rechtshaffen estimates you’d need to be in a home seven or eight years to offset the costs of moving in and then moving out again later on. Of course, this assumes your house is appreciating while you live there.

Renting is not on for most people, but it’s worth a thought if you’re a baby boomer with a house you’ve been thinking of selling. The peace of mind you get from locking in a good price could make it the financial move of a lifetime.

Boomernomics: Whether to buy or rent after you sell the family home