A simple remodel of your investment property can quickly increase the building’s curb appeal and raise the property value, giving you a substantial return on investment. But that’s not the only reason to start planning your remodel design today. Here we look at some of the biggest benefits of remodeling your investment property:
Increase the Rental Value
A renovation project can make the building more attractive and in turn, increase the rental rate. And a higher rental rate will help you pay off the renovation costs. Plus, a higher-end property will help attract more stable ten8ants who take better care of your property.
Decrease Your Costs
Remodelling to new and energy-efficient products can help you fix energy leaks and reduce your utility bills. Installing new windows, doors, and high-efficiency appliances and light fixtures are some of the best options to improve your energy usage and save you money in the long-term.
If you discover structural deficiencies or safety violations in a recently purchased investment property, you need to bite the bullet and correct these issues to ensure that the property is safe for tenants and visitors. Not only is it the right thing to do, but it will help avoid accident claims and legal headaches.
Get a Better Resale Value
Giving your home a beautiful new design can greatly improve its curb appeal and increase the value of your home when you go to sell it. This is especially true if you plan to sell within a few years of your remodel, as the improvements will still be in line with the latest trends.
Remodeling your property will also help you reduce vacancy time when your tenant decides to move out. New features and appliances are very attractive to new renters and will help your property stand out amongst your competition.
If you’re looking to gain more value from your investment property, a remodel is an excellent way to increase your rate of return. You may also be able to achieve consistent cash flow that will help you to pay off the renovation in no time. No matter what major improvements or do-it-yourself project you are planning, make sure to talk to a professional property management company who can help you make better-informed decisions on the types of renovations that will boost your profits.
Looking for an excellent way to generate some more income? Have you considered converting a part of your home into a secondary suite? Not only can the monthly rental income be used to pay back the renovation, but in the future it can go toward mortgage payments, education, retirement, or just add a financial cushion to your life. Our Toronto property management pros look at some things to consider when creating an income suite for your home.
Choosing the Right Space
First, you’ll need to find a space that can be converted into a rental suite. Your basement and attic are the traditional places for an income suite, if they have sufficient height, light, and space. You may also want to consider dividing off a section of your home, like the top floor or garage, and transform that space into its own rental area. Basements are the most common choice because they offer the most square footage and privacy.
A secondary suite must have its own living space, sleeping space, bathroom, and kitchen that is separate from the primary living space. Facilities such as laundry, storage, parking, and yard space can be shared.
Check Your Local Laws
Before you draft up the plans, make sure to check the local By-laws to ensure your space will abide by all the permits and zoning rules and regulations. Laws can outline how high the ceiling needs to be, the amount of space per person, if you need a fire or sound barrier, and how many units you are allowed to have in your home. For instance in the city of Toronto, you cannot add a secondary suite unless the home is more than five years old, and secondary suites have a minimum square footage of 55 sq.m. in most of the city.
Invest Wisely on Features
When installing features, you’ll want to pick fixtures that will be durable, functional, and will last for years to come. You don’t want to spend money only to have to reinvest again after your first tenant, so make sure you pick quality features. But don’t go spending money on high-end features and designs that will have a minimum impact on increasing the rental value.
Find Your Selling Features
To attract renters, you’ll need to have a few features that really stand out, especially if you want superior tenants. What are some attractive features that won’t break the bank? Think a stylish tile shower surround, a built-in closet organizer, or stainless steel appliances – the little perks you can’t always find in apartments. Plus, if you have an available deck or patio, you can easily transform this space into a great lounge area with lights, plants, and décor.
Know the Market
One of the most important parts of owning a rental suite is to understand the market. Knowing what price to list your property at, and how much you can increase your rent each year is very important. You may want to reach out to a professional for guidance to ensure you will make the most profit from your rental.
Renting out a part of your home can be easier than you think. Plus, it can help make lots of extra income and improve your financial status. If you want to get into the rental game, Simplified Rentals can help. From planning the renovation to determining market price to tenant screening, we do it all.
When you become a landlord, it doesn’t take long to realize how a great tenant can really help make your life and job much easier. Having a good tenant means less work, less time, and less aggravation for you. But the problem is finding those tenants and holding on to them. If you’re perplexed about where to find the good ones and how to keep them, here are some tips on the best practices that can help you during your search.
Target the Tenant You Want
If you want a quiet, professional tenant with a stable income, your best bet is to go right for the source. For instance if your apartment is located near the Discovery District, use those sorts of keywords in your ad: “Conveniently located near Toronto General Hospital, perfect for residents, nurses, and hospital support staff.” Likewise if you have an apartment, condo, or rental home near a campus that would be perfect for visiting professors or graduate students, use this terminology in your listing.
Make Sure Your Apartment Looks Great
Before advertising and showing off your apartment, make sure that it is in great shape. Any repairs or painting that needs touch ups are important to finish. If you have photos of a rough, unattractive looking space, chances are that you’re not going to attract the best kind of tenants, or alternatively, you could attract no one at all. Make sure it’s clean, that everything is fresh and fixed, and that the photos are bright and taken from angles that capture the space in its best light.
Screen Potential Tenants
This is a normal practice that just about every landlord does to ensure that their prospective tenant can afford to pay rent and has a history as a pleasant, stable tenant. Run a credit check, request income verification, and call references. One question that will tell you everything you need to know from a past landlord: “Would you rent to this tenant again?”
Be Open Minded
It’s natural for many of us to conjure up images of what the ideal tenant will look like. But of course, that isn’t always how they turn out. Do not judge people solely by appearance or occupation. All that matters is that your tenant is clean, pays their rent on time and is respectful of your property and other tenants.
Be a Good Landlord
Once you have found that dream tenant, it’s important to do your part as a landlord if you want them to stay long-term. That means keeping on top of any problems and repairs and being responsive to tenant inquiries.
Use these best practices when searching for your next tenant. With the proper steps you can find and keep that perfect tenant, which can make your job a whole lot easier. A property management company can help with all steps of the process, from interviewing tenants and performing routine maintenance to upgrading the property to increase rental value.
Investing in a rental property can be a low-risk, high-reward way to secure income for your golden years. It seems simple enough: purchase a property, rent it out, collect income—but every investment strategy has its pros and cons. If you’re considering jumping on the property bandwagon to fund your retirement, here’s what you should know first:
Pros of Owning an Income Property:
- Generates monthly income
- Tax advantages
- Can earn more each year by raising rent
The first advantage of owning an income property is implied in the name: it generates income for you on a monthly basis. Anything left after expenses goes into your pocket every month. Depending on the rental value of your property and how many units you own, this could be hundreds or even thousands of dollars of additional income each month. As you pay down the mortgage, the money in your pocket only increases each month.
This additional income can be used to fund your retirement, or it can be used for anything you choose: paying for children’s education, buying a boat, vacations, or reinvesting in other property.
Aside from the fact that it can generate additional income for you each month, one of the other advantageous aspects of owning property for rental purposes is that you can increase the rental fees each year. So even if it’s generating a smaller amount that you anticipated at the beginning, it can grow each and every year to keep pace with or exceed cost of living increases.
When it comes to taxes, you can deduct most of the expenses associated with your rental property from the income you generate, lowering the amount of tax you’ll have to pay.
Cons of Owning an Income Property:
- Finding Tenants and Stable income
- Expense and Repairs
- Non-Liquid Asset
Of course, every investment has its downside. For properties, the most obvious is that they are expensive, not only to purchase, but to maintain as well. It’s not always easy to scrape together enough for a down payment, never mind the higher down payment requirements that come with owning an investment property. Generally speaking, lenders in Canada require investors to front a minimum 20% down payment for non-owner occupied investment properties.
If you live in an area where finding reliable, stable tenants is difficult, it can cause your plan to fail, drastically. Any vacancies cause lost income, and undesirable tenants can cause higher maintenance expenses.
Make the most of your investment property by working with a Toronto property management company. From choosing the right property to finding the right tenants to conducting routine maintenance, Simplified Rentals will handle each and every step of the way in order to ensure your retirement is well funded and set for smooth sailing.
There’s a big difference between selling a property and putting it up for rent, and the major distinction can be seen in the way sellers and landlords treat their properties. While rental properties might seem like smaller investments in many ways, that doesn’t mean they shouldn’t get the same TLC that’s granted to properties for sale. Taking the time and making an effort to make your rental property stand out from the crowd will make it possible for you to find long-term tenants who will treat your investment right.
Would You Want to Live Here?
As a landlord, it’s difficult to invest hard-earned money in upgrading a property and going beyond basic maintenance necessities if you are worried that the tenants will undo your efforts through wear and tear. Yet rental properties that are properly maintained are much more likely to receive appropriate care from tenants. What’s more, a rental that looks and feels more livable and appealing with command higher rents and draw in long-term, stable tenants. Keep maintenance to a high standard and ask yourself “what would I want if I lived here?” when planning renovations and upgrades.
Pay Attention to Important Areas
Potential tenants care more about the layout, size, and feel of the kitchen and bathroom more than any other room. Providing a clean, clutter-free, and properly maintained kitchen and bathroom area will have potential tenants more interested in what you’re offering. Simple, budget-friendly upgrades like changing out hardware or adding a new backsplash can make all the difference in the world.
Show the Space in the Condition You Want it Kept
Ensuring your property is in good, attractive condition when showing it to potential tenants is extremely important for a couple reasons. First, it increases the likelihood that the tenant will want the place, and maximizes the amount they are willing to pay. And second, it makes it clear that you expect them to keep the property in similar condition. You don’t want to set the bar low and make it seem as though a dirty or damaged apartment is acceptable. So make sure the unit is clean, uncluttered and in a proper state of repair when performing showings.
It is crucial for property owners to perform routine property maintenance. Make sure you address the different problems and functional issues that arise before, during, and after a tenant’s stay to ensure the property is kept in great shape throughout its lifespan and the tenant remains comfortable and happy. Leaving small issues to compound and worsen will cause much bigger problems in the future, and might even cause your rental to become unworthy of a tenant.
A property management company can help your building stand out from the crowd and market the property for rent to attract desirable tenants. From managing maintenance and repair tasks, to creating unique advertisements and conducting viewings, Simplified Rentals handles it all.
Earlier this summer, Toronto city council voted in favour of moving forward with the Landlord Licensing Program. This is a plan that has been in the works for years, with the aim towards helping to keep landlords accountable, and to keep buildings in good condition by enforcing a set of standards. This is being hailed as a major victory for tenants throughout the city in an effort to ensure a better quality of living. If you’re a tenant or a landlord, here’s an overview of what this means for you.
Who will it affect?
The licensing program so far is proposed to apply to buildings three storeys or higher, with ten units or more. There are approximately 3,300 buildings of this classification in Toronto. Enforcing building standards throughout each apartment complex and requiring landlords to develop appropriate management and maintenance plans are also on the table for City Staff to review. Tenants will be made aware of any associated information in a proactive measure to maintain these standards.
Will this hike up my rent?
The Executive Director of Municipal Licensing and Standards, Tracey Cook, assured council that there would not be an “apartment tax” as a result of landlords seeking extra compensation for licensing and development plans. With current rules set in place, landlords do have the option of applying for a rent increase, but it would be very difficult to get approval at this point in time.
Considering almost half of Toronto’s residents reside in apartments, this will help to improve the adherence to maintenance standards and help to improve the quality of living for many. However, this is just the beginning. The next steps will be rolling out the details of the program and clarifying what it will entail for both landlords and tenants.
As plans develop and standards are created, the hope from advocates of the program is that they are actually adhered to, and severe and efficient punishments are handed out when they are not. But there is a strong fear that this plan will not house the repercussions needed to incentivize landlords to comply quickly and completely. Either way, for tenants, it appears to be a move in the right direction.
Would you like to learn more about Toronto’s landlord licensing program and how it affects you as a property owner or tenant? Contact Simplified Rentals and we’d be happy to answer your questions.
Exploring the latest in the Toronto Rental Market from Fall 2015 shows little change in vacancies rates, with an increase in rentals. Demand for rental accommodation remained consistent, with vacancy rates remaining at 1.6 percent, and availability rates remaining at 3.0 percent.
As the cost to purchase a home in the Toronto market continues to increase significantly, the market has showed that many residents are delaying the prospect of homeownership and remaining in a rental property for longer.
Condominium Rental Market
As the market has shown in previous years, condominiums are where the rental market has seen the highest amount of growth throughout Toronto, pushing the vacancy rate to 1.8 percent from 1.3 percent last year. Even despite the significant growth in the supply of units, the overall demand of condos continues to remain strong.
High Demand in Downtown Toronto
Significant amount of students moving into the city for school has helped uphold the rental demand in the downtown area, specifically. Additionally, the downtown area has accounted for much of the city’s job growth over the last few years. With this combination of the student population and downtown employment, there has been a natural growth in demand for private rental accommodation with close proximity to both work and school.
Increase in Average Rental Rates
With consistent and increased areas of demand for rental spaces, the average rental rates have naturally seen an increase. The average rent for a two-bedroom apartment increased by 3.3 percent in 2015 in the GTA, up from 2.7 in 2014.
With the additional increase of millennials looking to make their first move away from home, they too have kept the rental demand strong as they represent about 30 percent of the GTA population. But even aside from millennials, elder populations and young professionals who are looking for quality rental accommodation appears to be on the rise.
Purpose-Built Rental Properties Vs. Condominiums
Even as the idea of home ownership is drifting further from reality for many, people are still looking for quality rental accommodations. As a result, newer purpose-built rental properties are increasingly competing with the condominium market. The vacancy rate in 2015 for primary rental units commanding rents over $1,200 remained above the market average, suggesting that some rental households were using increased incomes to enter the condominium market instead.
Summary of the Rental Market in Toronto
So overall, the Toronto rental market has continued to remain strong and steady. With the ever-growing housing prices, demand for rental accommodation continues to see growth particularly within the downtown area. With these growing trends, there’s no sign of the rental market slowing down anytime soon.
Simplified Rentals is committed to providing expert advice to landlords and developers about the Toronto real estate market, with a particular emphasis on residential real estate, single family homes, duplexes, triplexes, condominiums, and apartment complexes. Contact our highly skilled and professional trained staff if you’d like to know more!
When you start to think about buying a property in Toronto and renting it out to potential tenants, it seems like a great way to make a steady profit over the years while building equity. Although it can be a great investment, there are stresses that come with the job. From tenant turnover to relations with your tenant, there are several things that you will need to prepare for if you’re interested in becoming a landlord.
A recent study from HomeLet in the UK showed that out of 2000 landlords, 18% found a high turnover of tenants to be the most stressful part of renting out a property. This is a justifiable stress that you may deal with depending on where your property is, the type of tenants that you rent to, and the pricing of your rental. It can be difficult to find people that are willing to stay in your property for a long period of time which forces you to have to find new tenants on a regular basis to maintain a steady income stream.
Imagine having a rental property where your tenants were always late on rent or simply unable to come up with the cash that month. You would essentially be giving them a free ride to be in your property and be in a position where you’d be responsible for the unexpected bills that month, and initiating eviction is a stressful and overwhelming process. The HomeLet study suggests that 12% of the participating landlords found that a tenant not paying rent was another huge stress that they had to deal with.
Safety Checks and Regulations
As a landlord it is your responsibility to make sure that your tenants have a safe and comfortable home to live in. In fact, according to many local laws you will need to have regular inspections to ensure that your property is up to code for renting. Keeping up with these safety checks and regulations came as the third (10%) and fourth (8%) most stressful parts of being a landlord, respectively. There can be a variety of factors that make this more difficult such as preparing the property for the inspection and letting the renters know when the inspections are coming.
Finding Good Tenants
Although it wasn’t found to be as stressful as safety checks and a high turnover of tenants, finding good tenants is still an issue that landlords have. You will want to make sure that you choose individuals that will take care of your property, show appreciation for their living space, pay rent on time, and generally be a pleasure to deal with.
Avoid the stress of being a landlord by working with a Toronto property management company like Simplified Rentals. From screening tenants to collecting rent, we offer a full suite of property management services so you get all the advantages of being a landlord with none of the stress.
Owning a rental property can be a profitable investment. But there are some important factors that must be present in order to ensure that investment enhances your long-term financial goals. Here are five factors to look for in order to ensure a rental property will benefit you in the long run.
It’s All About Location
We all know how important location is for the profit of a property. But the flux of the market, along with new developments and timing, are all connected as well. Choosing the right timing, city, neighbourhood, and knowing what your timeline is for owning the property, are essential factors for determining what to buy and more importantly – where.
You need to consider all options before investing in a rental property. It needs to be planned out carefully in order to ensure that you have a good, steady flow of cash. So determining your ability to find tenants, security of income, the condition of the property, and timeframe for it to be ready for renting, are important prerequisites to consider before you begin this investment.
Do you plan on managing the property alone, or hiring a property management company to ensure the best results are achieved? Location and property aside, if you don’t have a good handle on the management of the property, the other factors won’t matter. This is why the safest route is to place the success of your property in the hands of an experienced, professional property management company in Toronto.
Future Growth and Trends
In order to succeed, you must constantly observe and consider the potential future of your property, along with the trends of your local area and market. Are there new developments in the area? Is the population expected to rapidly increase – and if so, what are the predicted demographic trends? Will these trends affect your ability to find tenants and maintain or increase cash flow? This will let you plan out your future actions accordingly so that if you do decide to sell, you’ll have a plan in place, along with enough knowledge to know what would be most beneficial for you.
If you’re considering investing in a rental property, consider these factors before jumping in. One of the best ways to ensure the security and profitability of your investment is to place your trust and property in the hands of Simplified Rentals, a property management team that is experienced, professional and always aims to earn you maximum profit and return on your investment.