Not going to be politically correct on HST and Rents

Thanks to pandering by our Provincial government to all the powerful tenant groups in our province allowing another year of marginal rent increases as they implement HST.

It's ridiculous that they are making landlords shoulder more of the burden of the HST. What do I mean? The government will close the loophole allowing landlords to apply for above guideline rent increase (source Renters to get HST break)

Expect rent to only go up by the CPI next year as property owners have to pay more for trades to maintain properties, utilities and other services associated with making properties livable.

This on top of the bureaucracy involved in kicking a deadbeat tenant out makes HULK ANGRY

Toronto's city core is booming

Read an article in the Post (My Life in Suite 703: Core, hardly a snore)

and made me think of the Above picture by way of Black Jet Inc.

Lots of places for people to live in the core over the next 5 years...however, the skylines of Markham, Scarborough, Mississauga, Thornhill, Vaughan and Brampton will also be transformed.

The GTA is growing up...literally (thanks to the Greenbelt).

Adam Vaughan VS Brad Lamb

I receive this picture of the site Brad Lamb and Peter Clewes were looking to develop.


The picture came to me by way of a reader with the following note:

Rejected because of the height and the neighbours? What`s that in the
background?

I guess the bribe wasn't big enough.

Recalibration of the Condo Market

Networking with a few builders and financiers this week some interesting stories came out.


1. Land is expensive and scarce. Most developers are not willing to speculate that if they buy the land at a high price they will generate enough revenue with a high price unit.

2. It's still tough to get construction financing and land financing on projects.

3. Most of the smaller and inexperience builders are gone. Tougher financing requirements and the huge bureaucracy at Toronto City Hall are huge barriers to entry for new developers.


As a result the market is re-calibrating after the recession. Starts and New openings are picking up, but its going to have a different feel.

Development Merry Go Round

Councilor Adam Vaughan was one of the city officials to vote down Brad Lamb/Peter Clewes project next to King Street's Royal Alexandra Theatre .

I can see his reasoning, part of making a livable city is to have a mix of old and new. If there is too much development, the new buildings will have lease rates will based on today's construction costs and the older properties will have property taxes based on the value from the development potential.

This results in fewer cool and trendy local shops that gives a neighborhood an identity and replaces them with big chains than can afford the higher costs.

On Brad Lamb's side, there are very few sites that make sense, and those that have potential are priced high as owners hope developers will speculate and buy their property.


Councilor Vaughan will be appearing on Inside Toronto Real Estate on April 21st.

Peter Clewes and Brad Lamb will also be appearing on a future episode.

Stay tuned as we will see Royal Alexandria project come up again (going to the Ontario Municipal Board for appeal).

Source: National Post:
Community council rejects King St. tower

10,430 sales through the Multiple Listing Service® (MLS®) in March

This market is nuts, 10,430 sales and it's mainly Toronto (vs the rest of the GTA i.e. the 905) that's leading the charge.

Consider this:



Yes there is a condo craze going on...but there is huge increases in detached properties in the 416. WOW, I believe it.

So does how our market compare to other markets that I frequently look at

Vancouver 2,473 sales in February

This is a an increase of 67.1 per cent compared to February 2009. However, 2473 sales is a 7.6 per cent decline compared to the 2,676 sales recorded in February 2008 and were 13.5 per cent behind February 2007 when 2,859 residential sales were recorded on the Multiple Listing Service (MLS®) in Greater Vancouver.


Edmonton 3,728 residential listings in March

This up over 30% from a year ago and up 246% in the first quarter. Residential sales of 1,571 properties in March were up 15.1% from a year ago and 77.3% in the first quarter. Sales were up from 1,307 in February: a 20.2% increase.


Taking a look at the most recent housing Charts available at TREB, we see how hot this market is when comparing to 2007.

For the love of us buyers, please go down.

Big Mac Index: Inflation and The Canadian Dollar

According to StatCan, there is huge demand for Canadian debt-instruments as people around the world are losing faith in the US dollar.

Expect the Canadian dollar to continue to strengthen against the US as people around the world dump US assets and invest in our commodity based dollar (good news for Mining Centre of Canada: Vancouver?).


What does that mean for us Canadians? According to the Economist, A big mac is 13.5% higher in Canada than in the US.

This will be a downward pressure on interest rates

New mortgage rules for rent to limit first-time homebuyers

So now CMHC is only going to take 50% of the rental income from basement apartments. Not good (I wonder if CRA will do the same). Expect to see values come down in Vancouver and Toronto where this was a popular option.

I always thought having a tenant pay for part of your mortgage as a prudent strategy to decrease your expenses so you can save and invest that money into property in the future...CMHC feels that's speculating.

I love how the tenant association gets quoted saying its a good thing when smaller landlords have been the saving grace for the rental industry because very few purpose built projects will be built.

House Flippers in U.S. Crowd Courthouse Steps in Hunt for Deals

Loved reading This Business Week article on Flipping

It's amazing how much money is being made in the US downturn by flippers buying foreclosed homes, repairing them and flipping them off to buyers and investors.

These investors are licking their chops at Canadian investors looking to buy property in the sunbelt and you will see more and more companies looking for end buyers for their properties in Toronto.

This article really exemplifies what we do when looking for under-market value properties. It's a real grind it out business with lots of rewards.

My dad and I went on a fishing expedition about finding properties to flip in Seminole County (mostly tax sales) and it was really interesting going through the process of finding gems.

Most of these properties were in the 'hood and could have been had for a song...but the weird part, is that all the property liens would be transferred to us but the mortgages won't be(that's why the mortgage company usually works their butt to buy them).

Buying tax liens you were always competing against large insurance companies with money to park. Buying foreclosures you were competing with a lot experienced people who knew their stuff (and the odd seminar junky).

If trying to flip in the States, you will find immense value teaming up with a good title insurer (find those title and lien issues), a good realtor to understand what's the market value if you wanted to a quick sale and a good reno crew to do repairs as needed.

Flipping is simple but not easy.