The Canadian Parvasi - Issue 09

The International News Weekly MONEY/REAL ESTATE
18
August 25, 2017 | Toronto
What house owners should know before
hanging a 'For Lease' sign on their property
The Canadian Parvasi
TORONTO : With real estate sales softening
in many markets across Canada,
homeowners looking to unload their
property may find it preferable to hang
out a "For Lease" sign on the front lawn
rather than sell it for a less desirable
price.
While rental properties can provide
a stream of reliable income, housing experts
say the first-timer's success will depend
on a lot of factors — ranging from
the location and condition of your property
to the tax and legal implications of
becoming a landlord.
Royal LePage CEO Phil Soper says
property owners should start by getting
an up-to-date comparative market analysis
from their broker or sales rep.
"The challenge, like pricing any product,
is to find the maximum value that
you can drive in the marketplace and
keep it empty for the minimum amount
of time," says Soper.
"You can kill the entire economics of
renting your condo or your house out if
it stays empty for any extended period
of time."
Other than taking a month of turnover
to freshen up a property, he says,
you never want a rental sitting without
a tenant.
Soper adds that landlords will also
be affected by their personal preferences,
skills and available time to manage
the property. "It's not for me but other
people love it. They love the do-it-yourself
stuff. They love the regular income.
They even like dealing with tenants and
become friendly with them."
Toronto realtor Daniel Greenbaum
of Forest Hill Real Estate says one of the
key services he provides as a sales representative
for landlords is screening
prospective tenants to be sure they have
good references, are qualified in terms
of income and are likely a good fit for the
owner. "Unfortunately, once somebody
moves into a property, it's very hard to
get rid of them," Greenbaum says.
Lawyer Max Cohen, senior partner
at Cohen LLP in Toronto, says landlord-tenant
law falls under provincial
jurisdiction and the rules vary across
the country. "Alberta, for example, is a
little more landlord-friendly than Ontario
(which) tends to be a fairly tenantfriendly
environment."
He adds that landlords need to understand
how they'll be taxed under federal
law when the property is sold.
Once a principle residence becomes
an income property, there's a change
to its eligibility for an exemption from
capital gains tax — potentially a large
amount of money, depending on the specific
circumstance. "It doesn't mean that
all of the gain is taxable (but) probably
just as important you can't eliminate the
capital gains tax by moving back and living
in the property for awhile," Cohen
says.
Low oil prices continue to hit Alberta
The Canadian Parvasi
EDMONTON: Sluggish
oil prices are forcing Alberta
to dip into its reserve
fund and look for
more in-house savings to
keep its $10.5-billion deficit
from sliding further
into the red.
In his first-quarter fiscal
update, Finance Minister
Joe Ceci said the
province had expected
the West Texas Intermediate
benchmark oil price
to average out at US$55 a
barrel this year.
Instead, it's hovering
below US$49 a barrel
and isn't expected to rise
much in the near term.
"The forecast (at budget)
in March was based
on the best private sector
forecasts available.
The same is true of the
updated forecast," Ceci
said Wednesday. "What it
speaks to is a tremendous
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markets."
The province had
hoped to bring in $2.5 billion
in oilsands royalties
this year, but now expects
to take in $563 million
less.
Ceci said the government
will use half of its
$500-million contingency
fund to keep this year's
deficit from growing.
It also aims to double
the amount of money
spent on department operations
to $400 million
from $200 million.
The government will
continue to consolidate
services, streamline IT,
reduce travel and maintain
hiring restraints
while avoiding civil service
layoffs.
About $120 million
has already been found,
he said.
"It's an ongoing exercise
and I know my colleagues
in different ministries
are up for it."
Ric McIver, the United
Conservative Party finance
critic, said taxpayers
deserve more details
on the savings.
"The minister gave
himself a pat on the back
for doubling the in-year
savings projections, but
can't tell us where these
savings are coming from,
or why he's so confident
in his double projection,"
said McIver.
"One could at least
wonder whether the second
$200 million wasn't
concocted to make today's
media conference go better
for the minister."
Ceci noted there are
bright signs on the horizon.
The province expects
the economy to grow by
3.1 per cent in 2017, up
from the March budget
forecast of 2.6 per cent.
Employment is also expected
to rise by 1.3 per
cent, higher than the 0.9
per cent forecast in the
budget.
Alberta has been
struggling for years with
a prolonged trough in oil
prices, draining billions
of dollars from its bottom
line and throwing
thousands of people out of
work.
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