latest investment strategy in market

[susanjohnyba]

* Buy foreclosures, homes that need repair, etc.
* Fix/Renovated.
* Re-Fi (optional).
* Rent out.


Same as always, except the last step (used to be "sell" instead of "rent out".

Once commercial bottoms out... there might be good buys in cities receiving stimulus money and putting it towards their downtown

[bg_27]

I don't know, I was watching the news last night (been thinking of picking up some rentals) and the rental market is getting softer, more vacancies (vacancy rate double last year) and prices are coming starting to come down.

I think especially with all the speculative investors that can't sell, more and more rentals will start popping up. But I think if you find a good location and not a condo/apartment you should do good over the long term assuming you can afford the payments if you don't have a renter.

[urban.one]

Calgary's vacancy rate climbing, but no price break for renters

Apartment cost second only to Toronto

By Colette Derworiz, Calgary HeraldJune 11, 2009 7:04 AM



Al Ducharme, an insurance worker who found a one-bedroom apartment in the Beltline for $750 a month, says, "I'm happier than a pig in mud."

Photograph by: Ted Jacob, Calgary Herald, Calgary Herald

CALGARY - Calgary is slowly becoming a renters' market, but the average cost for an apartment is still the second highest of major cities across Canada.

The average apartment vacancy rate increased to 4.3 per cent in April from two per cent a year earlier, according to the annual spring survey by the Canada Mortgage and Housing Corp.

Although the economic downturn contributed to the higher vacancy rates, officials with the agency said there are a couple of other reasons for the increase.

"The primary reason for turnover in rental units is people moving into home ownership, and the next big reason is people relocating for job reasons," said Lai Sing Louie, senior market analyst. "So right now, as people are moving out of the units, they are not being filled quite as fast."

Despite the vacancies, the prices still went up slightly this year--to$1,106 for a two-bedroom unit from$1,096 last spring. That's due, in part, to a higher number of luxury rental units and upgrades to existing apartments.

Several renters said it's tough to find an apartment that is reasonably priced and in good condition.

"My search was rather trying," said Al Ducharme, 27, who spent more than two months looking for a place. "People want a lot for a little. They want your money, but they don't really want to give you a lot in return.

"But I got kind of lucky with the place I found."

Ducharme, an office worker for an insurance company, said he ended up finding a one-bedroom apartment for $750 in the Beltline.

"It's warm and I've got level floors," he said. "I'm happier than a pig in mud."

Nikki Cornell, 22, visited Calgary last weekend to look for a place to live when she moves to attend graduate school in the fall.

"It's awful," she said in a phone interview from Toronto. "Compared to here, it's really expensive. It's really expensive for really small places."

Indeed, the survey showed Calgary's monthly rents were higher than in Toronto, where the average two bedroom unit is $1,093. Only Vancouver has higher rents ($1,154)among the major cities.

The Calgary Apartment Association suggests the city has returned to a renters' market.

"There's a lot of incentives that are being offered out there," said executive director Gerry Baxter, noting landlords are offering a month free rent or cable service for extended leases. "That actually works out to a decrease in the rent."

Oftentimes, he said, they are careful to lower the rent out of concerns the market will take another upswing.

"If you start decreasing the rent, at some point in time, that's totally lost income," said Baxter. "So when the market changes again, if you need to increase your rent to keep up to market, you've got a bigger gap to try to make up."

During the height of the boom, rents increased by more than 15 per cent a year before levelling off in the past year as the recession hit.

But Baxter said the costs for landlords continue to increase.

"The city hasn't reduced its property taxes, the city hasn't reduced water costs," he said. "Electricity rates continue to escalate, insurance is escalating.

"So we've got high maintenance costs and high labour costs and all of those other factors, and they don't come down. How do you meet all of your costs by lowering your rents? You can't do it."

Still, some landlords are starting to reduce their rents, he said.

One renter, Lacy Rasmussen, said she's receiving a lot of good replies since she posted an ad on the Internet for a two-bedroom apartment or condo.

"It's reasonable," she said, noting she's hopeful about her search. "There's tons out there."

Market analysts agree, suggesting there is more selection for renters than there has been in years.

"For someone looking to rent a place, they are going to have more choice," said the CMHC's Louie. "They should shop around.

"If they shop around enough, they may find that incentive that would reduce the effective rent."

© Copyright (c) The Calgary Herald




Al Ducharme, an insurance worker who found a one-bedroom apartment in the Beltline for $750 a month, says, "I'm happier than a pig in mud."
Photograph by: Ted Jacob, Calgary Herald, Calgary Herald

More empty apartments, no drop in rental rates
Last Updated: Wednesday, June 10, 2009 | 7:08 PM MT Comments15Recommend8CBC News
Calgary's vacancy rate has more than doubled in the past year, but rents remain among the highest in the country.

The city's rental vacancy rate jumped to 4.3 per cent in April from two per cent in the same month a year earlier, according to Canada Mortgage and Housing Corporation. But the average rent for a two-bedroom unit during the same period rose to $1,106 from $1,096.

Industry insiders say the slower economy has fewer people moving to Calgary, while existing renters have incentives to buy.

"Interest rates for home ownership are so low now for mortgages, people are leaving and buying new homes," said Gerry Baxter, president of the Calgary Apartment Association.

New tenants are sometimes seeing perks like free cable or even a break on rent for the first month.

"We're seeing many landlords that do whatever it takes to attract tenants to their building, [even] if that includes reducing the rents or offering incentives to attract people," he said.

"It's a very competitive market so if you want to rent your units, you have to make sure that your competitively priced. If you're not and you're overpriced, you won't rent your units and you'll have greater vacancies."

Renter Carol Anne Peterson just returned to Alberta after a few years in Eastern Canada and abroad. It only took her a week to find a rental home, which she says has all the comforts and amenities she needs at the right price.

"The rents were even higher like 10 years ago than they are now in some areas, but it all depends on what you are wanting," she said. "You can have a big fancy place for two [or] three bedrooms that are very high in rent or something reasonable."

Calgary is still the second highest in the country for average monthly rents, just below Vancouver at $1,154. Toronto follows in third at $1,093, Edmonton in fourth place at $1,059, and then Victoria rounds out the top five at $1,043.