Tuesday, September 15, 2015

Downturns and Landmines

Alberta Oil Sands Investment Real Estate News®
Glenn Simon Inc., Suite 1217, 5328 Calgary Trail NW, Edmonton, Alberta, Canada. Tel 1-888-780-5940 Fax 1-888-276-4517
www.glennsimoninc.com   email: info@glennsimoninc.com

September 15th., 2015
Volume 19, Issue 4

Dear Friends and Partners,

I hope that your summer has been awesome. I’ve been busy with my boys, gardening, camping and enjoying as much of the Albertan summer as I can. Real Estate in Edmonton tends to take a break as well. You’ll see longer than average DOM for average properties just due to the lack of traffic. Sought after locations and incredibly well priced deals, still go fast. The multi-family market has been slower than usual with less than stellar listings on the MLS/CLS. That’s not to say that sales don’t happen - several, excellent pocket listings have been bought and sold  this past month.

With the federal election looming just 5 weeks away I’m finding some buyers hesitant to commit to a purchase and some (albeit not many here) sellers anxious to unload if over 60 DOM. What that means if you’re a buyer is that you may be able to wiggle a better purchase price between now and the election results. For seasoned investors the election timing doesn’t play such a big role in making a purchase, other than leveraging a sale. Seasoned investors have a plan in place to operate their property in a down or an up market. There are pros and cons to both and money making opportunities for each.

One maddening trend that I am starting to see is inexperienced ‘investors’ getting nervous about filling their vacancies. I’m starting to see ads for reduced rents, security deposits and even ‘1 month free’. This is a poor strategy and one that pulls all investors down. There are many strategies to employ (we list a lot here and in our media section of the website, look for “How To” articles.) that will help you get a better tenant and offer them value without dropping your rents below market value.

If you’re having trouble renting a property now, give me a call and I’ll fine tune your ad and give you some tips to help. Smart investors have  a good buying season ahead - give me a shout to see what investment properties we have that fit for you.

P.S. Want a cool mini-guide to investing in a downturn? We published a terrific booklet back in 2011 titled “3 The Critical Landmines You Need To Avoid When Investing in Real Estate”. I’d like to send it to you. Simply reply back with “3 Critical Landmines” in the subject line and your email and we’ll hit you back with a  free copy.

South East Edmonton: Holyrood 4-Unit Cashflow 

Turbo charge your portfolio. This terrific Side by Side duplex features separate (not legal - but potential to legalize) suites down. 1957 built, located on a quiet cul-de-sac, across from school and park. Walking distance to schools and transport. Close to downtown and Wayne Gretzky Drive.

This property has separate entrances to each suite; 2 X 2 bd and 2 X 1 bd, double garage, plus pad. This property was purpose built and is in fair condition. Investment capital includes $30K budget slated for further renovations to modernize, improve value, aesthetics and rentability. This is a turn-key deal. Good access to downtown and in a great, mature neighbourhood.

Comes complete with great tenants making this a totally turn-key property for you. Holyrood is a mature neighbourhood that is desirable for tenants working in the south end and downtown. HUGE upside potential due to the great purchase price, strong economic fundamentals and the proximity of this property in relation to Edmonton's desirable growing core.

Purchase price: $625,000
Total Investment: $146,090
Your Estimated 5 Year Profit: $90,498
Your pre-tax Total ROI is 62% or 12% per year

These 4 suites rent for top dollar and have everything arranged, including financing structure and incredible tenants. Your investment includes: impeccable tenant selection, financial analysis, professional inspection, insurance, financing set-up, legal fees, basic accounting, reserve fund, CMA, bi-annual statements, strategic market planning to ensure successful entry and exit, plus much more!


Edmonton has low risk of housing correction, new report says

By Alicja Siekierska, Edmonton Journal, August 4th, 2015

 The Canada Mortgage and Housing Corp. says Edmonton faces a low risk of having to deal with a housing market correction despite a slumping economy.
The organization released results from its House Price Analysis and Assessment, which is designed to detect problematic conditions in housing markets across the country.

Edmonton and Vancouver were the only two cities on the list of 15 that were cited as low risk in all four categories considered — overvaluation of home prices, overbuilding, price acceleration and overheating. GRAB THIS STORY


Alberta housing market forecast to rebound 2016

By Mario Toneguzzi, Calgary Herald, August 20th., 2015

After a tough year in 2015, Alberta’s resale housing market is expected to rebound in 2016, according to a report by RBC Economics.
The bank’s senior economist, Robert Hogue, is forecasting sales in the province to dip by 17.8 per cent this year from 2014 to 59,000 transactions — the largest drop in the country.

But Alberta is then expected to see the biggest year-over-year hike in sales in 2016 of 7.1 per cent to 63,200 units.

Despite the drop in sales this year due to a slumping economy and continued depressed oil prices, the average sale price in Alberta is forecast to climb by 0.7 per cent to $378,500 and grow by another 2.1 per cent next year to $386,600.   READ MORE HERE


Update on housing - no boom - no bust.

By John Clinkard, Journal of Commerce, September 8th, 2015 

While the term "recession" may have applied to some sectors of the Canadian economy in the first half of the year, it certainly does not apply to Canada's housing market. This view is strongly supported by the fact that, after exhibiting back-to-back declines in December of 2014 and January of this year, due in part to the negative impact of low oil prices on Alberta and colder than normal weather on the rest of the country, home sales have trended steadily higher since February. 

Moreover, despite the very weak start, the volume of sales in the first seven months of this year are 5.4% higher than during the comparable period in 2014. In addition, year to date, home sales are up in seven of the ten provinces led by British Columbia (+21.4%), PEI (+11.6%), and Ontario (10.1%).  FOLLOW THIS ARTICLE


I appreciate all your calls and emails. I'm looking forward to helping you with your next step towards building real wealth.
Your success continues EVERYDAY, let me help you build for tomorrow.

“The way to get started is to quit talking and begin doing.  -Walt Disney

Warm Regards,

Todd and Danielle Millar


P.S. Stay ahead by checking out Danielle's daily blog at Edmonton Real Estate Investor for all your cutting edge market news and information.