The Waiting Game

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


July 29, 2016

Volume 21, Issue 3

Dear Friends and Partners,

Even if you try and avoid the news, its tough to miss the tension and turbulence globally. U.S. politics alternates top position with terrorist attacks in Europe. Sadly, the attacks are winning as they increase with atrocity and devastation. Europe is in a war, whether they acknowledge it or not. Some will argue that we are too...

War, terrorism, Brexits, oil, elections - influence one another. Local economies, currencies and economic platforms react and adjust. In our newsletter we focus on economic drivers by studying macro/microeconomics and global economic trends.

Well, the trend right now is a big, ugly war ahead. Some may call it something else, but that is what it is. You can focus locally and see how good it is, sure, but I think we’ll start to see changes in our neighbour countries that will affect us. This may bode well for financial gains in long-term but the short-term trade off could be tense, tighter and diminishing daily life, until global ‘peace' is restored.

**Summer is upon us. Our newsletter will take a break and enjoy the weather, resuming September 1st. Read our blog for  updates.**

South East Edmonton: Ekota, Legal 4-Unit Cashflow



Turbo charge your portfolio. For those wanting a low risk investment in a great area with 4 units under one roof - here it is. 4-unit each 1300 sq ft, steps from park and school. 4 minutes to Grey Nuns Hospital, 15 to UOA and down town.

This is property has many recent upgrades and is completely self contained - tenants pay all utilities. 4 X 3 bedroom units with 3 bathrooms, built in dishwashers and in-suite laundry. 1978 built, newer roof, some windows, kitchen and laundry upgrades.

Terrific access to local amenities in sought after Ekota. This property has 8 parking stalls. Purchase price to include reserve fund and light renovation budget to make it standout - rolled into mortgage. This is a turn-key deal. Excellent access downtown and in the highly rent-able neighbourhood of Ekota.

Comes complete with great tenants making this a totally turn-key property for you. Ekota is a mature neighbourhood that is convenient for tenants working in SE Edmonton. HUGE upside potential due to the great purchase price, strong economic fundamentals and the proximity of this property in relation to Anthony Henday and Grey Nuns Hospital Edmonton.

Purchase price: $905,000
Total Investment: $205,200
Your Estimated 5 Year Profit $126,318
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!

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Varcoe: Watching the pendulum swing on Alberta’s fragile economy

By Chris Varcoe, Calgary Herald, July 23rd., 2016

ConocoPhillips Canada will cut up to 300 jobs this fall, while Encana Corp. expects to spend an additional US$200 million on capital later this year to drill more wells.
Oil prices slip below US$45 a barrel on Friday, while Canada’s largest driller says it’s noticed a positive change in customer sentiment in the past six weeks.

Like a pendulum swinging back and forth, the Alberta economy seems like it’s moving in opposite directions on an hour-by-hour basis.

“Sentiment is quite unsure,” said economist Warren Kirkland of TD Bank, which issued a report this week on the state of Alberta’s recession. READ MORE HERE 

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Alberta’s economic downturn will be longest since early 1980s: TD

By The Canadian Press, July 18th, 2016

CALGARY -- A new report says Alberta's current recession is expected to shrink the economy by more than double the average of the past four recessions.
The TD Bank report released Monday said it estimates Alberta's economy will contract 6.5 per cent over 2015 and 2016, which would widely exceed the 2.7 per cent average retreat of previous economic downturns going back to the early 1980s.

The estimate came after TD tripled this year's expected GDP decline to three per cent, after factoring in the Fort McMurray fires and a higher than expected drop in industry activity.

"Based on our revised forecasts, the 2015-16 recession is likely to go down in history as one of the most severe using the GDP benchmark," TD wrote. GRAB THIS ARTICLE

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Paula Simons: New EI numbers paint perplexing picture of Edmonton economy

By Paula Simons, Edmonton Journal, July 22nd, 2016

Just how bad is it?
According to new Statistics Canada numbers released this Thursday, the number of Albertans drawing Employment Insurance benefits jumped by 21.1 per cent between April and May of this year. As of May, there were 77,800 people drawing EI in Alberta — up 58.6 per cent from May, 2015.

Here’s where things get a little more complicated.

Almost one-third of those new EI beneficiaries came from the regional municipality of Wood Buffalo, where the number of EI recipients jumped by a whopping 141.6 per cent, almost entirely as the result of the Fort McMurray fire.  FOLLOW THIS STORY

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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.

“In a sense, terrorism blossomed in the advent of television. Television promotes terrorism in religion and politics” -Marilyn Manson

Warm Regards,

Todd and Danielle Millar

Batten down the hatches.

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


July 30., 2015
Volume 19, Issue 3

Dear Friends and Partners,

** Summer is here and your newsletter is heading to the beach! Issues resume again September 15th. Our Blog keeps going though - so check in regularly. **

With the sun shining and summer in full swing, it's hard to imagine winter being 3 months away… I want to remember these seasonal changes (the cycle) and do my property maintenance now, so that I’m prepared for winter. I want to prepare now, for the next real estate cycle (downturn) that is coming. It’s not good or bad, it just is. You can take advantage of ridiculously low mortgage rates, conservative buys and position yourself well with rental properties during the next buying period.

I’ve attached a few links below to articles on property investment and tips to help prepare and manage downturns, including this article we wrote in ’09:


How To Keep Investment Real Estate Profitable In Any Economy

Wherever your real estate investment is located—provided you bought it at the right price and terms—there are many ways to keep your property profitable. If you analyze your real estate, update and improve your investment team, review your long- and short-term investment plans and stay focused on the end result; your real estate portfolio will be a rock solid fortress that can weather any storm.

Analyze

The first and most important thing is to carefully analyze your portfolio.

What properties are doing well?
Are there properties that are slowly leaking dollars like a dripping tap?
If so how can you fix them?
If you don’t know the hard numbers on your properties, then you are risking everything that you have worked for. Keep your budgets in line and carefully evaluate every purchase and renovation. Once you have a better idea of where you stand, you can start to recession-proof your properties. First, your customers are your tenants, so learn how to keep them happy and decrease vacancies. For example:

Provide Internet or free cable
Give lease incentives or rewards for rents paid on time, or even the best garden.
Increase your revenue by adding rental units to your properties or other moneymaking add-ons like renting garages separately, extra parking spaces or coin-op laundry facilities. You can also refinance your mortgages with longer amortizations, increase rents where reasonable or rent your properties furnished.

Evolve and involve your team
Is your property management up to par?
Are you getting discount rates for a big portfolio?
If you have few properties are they being managed in a way that will help you grow your portfolio? 
Are their rates competitive and are they keeping your property in excellent resale condition? 
Streamline your team. I don’t mean fire everybody and do it all yourself, but rather make your team out of the best players available in your area. Once you have the all-star team, get their input and advice, use their knowledge and experience to protect and improve your assets and your position in the market. Accountants can help you lower your taxes, lawyers can protect your assets, bookkeepers keep you aware of money liquidity and property management can up the cash output of your investment property.

Be aware

Be aware of longer-term trends and statistics. Don’t get caught up in the moment—especially when making decisions. There are both positive and the negative things that are happening in headlines. Take both sides into account and be realistic as you evaluate what’s really going on. Review your business plan both short-term and the long-term and adjust it as necessary. Don’t knee-jerk react, but also don’t drift back and forth without any solid goal in site. Have multiple investment strategies all with a clear exit in place. 

This is not the first economic downturn the world has seen nor will it be the last. What is important is to mind your business and your properties to make them profitable no matter what comes your way.

Recession proof rentals HERE  and HERE

North West Edmonton: Sherwood 4-Unit Cash flow 

(Not one of my target areas, but still a solid property.) 


This massive Side by Side duplex features separate (not legal) suites down. 1963 built, located across from park. Walking distance to Parkview School and less than 10 minute drive to West Edmonton Mall. Close to downtown and Whitemud. Good access to downtown and transit.

This property has separate entrances to each suite; 2 X 3 bed and 2 X 2 bed, double garage, plus pad.

This property was purpose built and is in fair condition. Investment capital excludes $15K (PPI) budget slated for further renovations to modernize, improve value, aesthetics and rent-ability. The funds are returned at end of renovations once bank appraisal is complete.

Comes complete with great tenants making this a totally turn-key property for you. Sherwood is a mature neighbourhood that is desirable for tenants working in the west end of the city. 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: $579,000
Total Investment: $139,856
Your Estimated 5 Year Profit $78,179
Your pre-tax Total ROI is 56% or 11.2% 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!

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Tax expert pushing for new tax in Alberta

By Kevin Maimann, Edmonton Sun, July 20th, 2015

One of Canada's most influential tax experts is pushing for a new tax in Alberta.

Dr. Jack Mintz, who is currently on the Economic Advisory Council for federal finance minister Joe Oliver, spoke Monday during a business luncheon to the Rotary Club of Edmonton.
Mintz was invited to give his views on the economic and social priorities of Alberta's new government.

He said a 7% Harmonized Sales Tax -- which would mean adding 2% to the federal GST, with the added tax to be collected by the Canadian Revenue Agency and remitted to the province -- would bring in over $1  billion.  GRAB THIS STORY

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Alberta Economy: Province needs to nurture its economic gazelles

By Stephen Murgatroyd, Troy Media, July 21st., 2015

EDMONTON, AB – A colleague suggested to me recently that Alberta should stop talking about diversifying its economy. Instead, he said, we should talk about broadening the economic base.
He is right.

Of course, the province’s economy is diversified now – somewhat.

For example, Alberta opened its forests to forest companies back in the 1970s, which led to the province becoming home to North America’s largest pulp mill (Athabasca’s ALPAC), as well as several other mills. Our mills and lumber firms are efficient, productive and significant players in the Alberta rural economy, with some 18,000 jobs and significant exports ($2.7 billion in 2014). It is a $5.4 billion industry.  READ MORE HERE


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National Post View: Stop delighting in Alberta’s misery

By National Post, July 24th, 2015 

Alberta, a province with a population of about four million, has been dominating the country politically and economically for the past decade. But with tanking oil prices, industry layoffs, pipeline leaks, agricultural disasters and NDP political successes, many in the rest of the country are feeling a sense of schadenfreude: the delight in Alberta’s economic — and political — misfortunes.

To at least some extent, their feelings are understandable. It was not long ago that Alberta was at the top of its game: from the rise of Stephen Harper, to the increasing importance of the energy industry as central Canadian manufacturing faltered; Ontario’s debt rose and Quebec’s fiscal situation spiralled as Alberta remained blissfully debt free.  FOLLOW THIS ARTICLE
 
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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.

“My optimism wears heavy boots and is loud.“  -Henry Rollins

Warm Regards,

Todd and Danielle Millar

The Toilet Paper Entrepreneur - Reblogged

I don't usually go to this site but came across this fantastic post on The Toilet Paper Entrepreneur.

"7 Reasons Why The Recession Is Good For You" has some excellent reasons why spending less money, hanging out with family and friends, streamlining our businesses and eating home cooked meals MIGHT actually be good for you!

Read the blog HERE

50% Don't Notice The Recession - My Poll

Although it may be a small test group the poll results are in! A week ago I asked how the recession was affecting you and your business. I also hoped to get some really good tips on how to survive and keep investment property thriving in a down market. Like this article or how to save money at home.


The Voters Speak:

50% Noticed small change in their business but nothing dramatic
37% Noticed a definite change in their business for the worse
12% Had been hit hard

Next time I will ask for occupation or field so we could really see where people are getting hit. Hopefully next time more than 8 people will vote.

What Recession?

How is the recession affecting you?
Do you even notice that there is a recession or has your business been flummoxed? Do you find this is the time to tighten your belt or have you been expanding due to lowering prices and cheaper labour?

Are you practicing frugality- if so how anything this extreme? Any tips real estate related or in general to cut costs?

I'd like to see how everyone is doing. Please take my mini poll in the upper left corner.

The Hot Dog Parable - A New Twist

With more and more focus devoted to how bad we have things, I thought I'd dig up a mini version of the Hot Dog Parable.

The Hot Dog Parable: There once was a man who lived by the side of the road and sold hot dogs. In fact, he sold very good hot dogs....

He put up highway signs telling people how good his hot dogs tasted. He stood by the side of the road and called out, “Buy a hot dog, mister?” And people bought his hot dogs. They bought so many hot dogs, the man increased his meat and bun orders. He bought a bigger stove so he could meet his customers’ demands.

And finally, he brought his son home from college to help out in the family business.

But something happened. His son said, “Father, do you not watch television, or read the newspapers? Do you not know we are heading for recession? The European situation is unstable, and the domestic economy is getting worse.”

And the father thought, “My son is a smart boy. He has been to college. He ought to know what he is talking about.”

So the man cut down his meat and bun orders, took down his highway signs, and no longer stood by the side of the road to sell his hot dogs. His sales fell fast overnight. “You’re right son,” said the father, “We certainly are in a serious recession.”

If you're worried about the man who sold hot dogs, his story has a happy ending. Luckily for him, he had a daughter too. His daughter was able to show him that attitude, commitment and belief are what it takes to change, succeed and even sell hot dogs. After all, there are many folks who still want to buy them, 'recession' or not.