Over the past decade, real estate has been one of the best performing sectors in Canada, if not the best. There are countless stories of people who have made hundreds of thousands of dollars simply by owning a house in the right location, during the last decade. And since gains on a principle residence are tax free, there are all sorts of people who have significant wealth stored in their house.

Let’s check out a pretty chart, provided by My Friend Fernando, a Realtor out of Calgary.

As you can see, prices have gone up drastically over the past decade or so. Prices have more than doubled during that time. Interest rates have declined during that time as well, meaning the cost to service a mortgage hasn’t really gone up with prices. If you combine that with longer amortization periods, the average Canadian homeowner is still making a reasonable mortgage payment. In fact, it’s allowed them to take on all sorts of other debt, perhaps to their detriment.

Can Canadian real estate prices continue to rise? This observer doesn’t think so. Here’s why.

Cheaper To Rent

Especially in major centers like Toronto and Vancouver, it’s cheaper for someone to rent than to buy. In certain neighborhoods, the difference between renting and buying is significant – to the tune of 25-50% savings for the renter, especially in the condo market.

Why is this happening? It’s simple. All sorts of people are buying up condos, with the hope of cashing in on the inevitable capital gain. All these landlords care about is getting some of their costs back in the meantime, so they rent out the units, for whatever they can get for them.

With more and more young Canadians buying their own condos, (partially influenced by how well real estate has done) this drives rents down, since less people are doing it. Supply is high, while demand is low. And as prices have gone up, so has the cost of servicing that mortgage. So the cost of owning has surpassed renting.

A metric which can be useful is to look at the home price to income ratio. Normally, at a national level, this hovers at around 4. In certain areas of the country, the ratio has risen to 6 or 7. From that perspective, these are overvalued.

Everybody Loves Real Estate

While there’s a small minority of people who are certain Canada is headed toward some sort of real estate meltdown, it’s still an incredibly popular asset class to own. Young people are hitting up their parents for loans for down payments. You often hear people talk about buying before the market goes up again and they get priced out. The level of home ownership in Canada has reached record highs, even surpassing the levels seen by the United States during the peak of their real estate mania just a few years ago.

And really, who can blame people for having confidence in real estate? Often, someone’s house is the only investment of any significance. Memories of a stock market collapse are fresh in our minds. Investment returns have been disappointing. For many people, their house has been far and away their best performing investment.

Emboldened by recent success, people are quick to jump on the real estate bandwagon. But are they committing a classic investing sin by loving something only after it’s had a terrific gain?

What Can Go Wrong?

What would have to happen to soften the real estate market? Unfortunately for bulls, any one of several factors could put the kibosh on this party.

Interest rates are at record lows, which allows people to buy more property than they’d be able to afford if rates were at more traditional levels. As mentioned above, this keeps mortgage payments reasonable, even as values continue to climb. Many homeowners are in ultra cheap variable rate mortgages,  meaning they’ll be hit immediately by rate increases, which will happen sooner or later. Homeowners in fixed rate mortgages will have a bit of a buffer until they renew their term, but they will eventually feel the pain of higher rates as well.

Meanwhile, Canadians have record debt levels. It’s going to be difficult for many homeowners to afford an extra few hundred bucks a month, since they already carry all sorts of other debt. This is not good for the market.

Most mortgages in Canada are recourse loans – meaning you can’t just abandon your obligation like so many Americans did. The bank has every right to sue you into the stone age if you decide to mail your keys back to the lender. This could cause a situation where many homeowners would like to move, but can’t get out of their current place.

As cracks appear in the market, public sentiment will shift. People won’t automatically associate real estate as the ticket to wealth. They’ll move onto the next popular investment. This will reduce the sea of buyers. Combine that with an increase in sellers, and you get a potentially toxic situation.

There are all sorts of factors that could cause the market to fall. What do you readers think? Is Canada poised for a major real estate correction?

Related Posts:

• 5 Factors That Might Burst The Housing Bubble
• Canadian Home Resales Set Record For July
• Should You Use A Real Estate Agent To Sell Your House?

Is Canadian Housing In A Bubble? originally appeared on Canadian Finance Blog on December 29, 2011.

If you have a property that won’t sell, consider renting it. As demand rises, the rental rates rise higher with it. What was once a major headache for no real return may now be worth the time and hassle. If you’re planning to rent your home, here are a few things to consider.

Escrow

Before you rent your home, save some money. Something is going to go wrong with the home and at some point one of those repairs will be a major expense. Just for repair expenses, keep at least $3,000 to $5,000 in liquid funds.

In addition to those funds, be prepared for the problem renters who don’t pay. Eviction proceedings can cost a lot of money, take more than a year to resolve and in that time you may not receive any rental proceeds. Have enough money saved for that scenario.

Insurance

Regular homeowners insurance isn’t going to cover your rental property. Additional liability protection is needed to protect you from lawsuits that could arise from your renters becoming injured on your property.

Problem Renters

If only the world were the kind of place where everybody paid the debts they owed and took care of property that was loaned to them as if it was their own. That’s not the world we live in and if you rent long enough you’re going to get the wrong people renting. They’ll tear up your rental property, won’t pay on time or at all, and you’ll have the stress and headache of trying to get them out. Run a credit check, check references, and examine their application closely.

Property Manager

For about 10% of your monthly rental you can hire a property management firm to handle your rental property. You pay them so you can be a silent partner. They market the rental property, screen renters, collect the renal payment, and handle the repairs. Especially if you no longer live close to your property, a property manager is worth the 10% you’ll lose.

The housing market, much like the world’s banks, is loved about as much the flu but in every market, some lose and some win. Your home doesn’t have to be a loser. There’s a good chance that somebody would be happy to rent it if you have the resources to be a landlord. It’s not for everybody and you may not rent it for enough to cover your mortgage payment but that’s a worse case scenario. The chances are higher than you think that renting your property may produce a little bit of income.

Related Posts:

• Insurance You Can Do Without – Rental Car Insurance
• Four Ways to Deal with a Home That Won’t Sell
• Residential Property Investing For Beginners

Renting is the Craze Now! Here’s How to Prepare for It originally appeared on Canadian Finance Blog on December 12, 2011.

Here in Canada where the real estate market hasn’t been quite as bad, you may not be close to foreclosure but you may be one of the homeowners who still have an underwater mortgage.

If you have a home that won’t sell or is underwater, you may be looking for options and sometimes, the options aren’t in your favour. I’ve put together a list of the best of the worst options when your home won’t sell.

Stay Put

Why do you need to sell your home? Is it out of necessity or because of a want? It’s tough question to ask but could you stay in your home for another five years or at least long enough to add value to your home if it is only slightly underwater? Other options may present themselves to you in the near future.

Rent it

Renting isn’t for everybody but for those who have to move, renting your property may not be a big money maker but it will at least lift the burden of a second mortgage payment and you have the added benefit of making your mortgage a little less underwater with every rental payment.

Beware of the problem renters. Eviction proceedings can take more than a year, cost thousands of dollars, and result in no rent money coming in for that period of time. Can you afford that if it happens?

Lease it

Leasing is similar to renting except, much like a car, at the end of the leasing term the person leasing your home has the option to purchase your home at a set price that you two agreed on at the beginning of the leasing term. In exchange, you add a non-refundable premium in to the rental payment. If they get to the end of the term and don’t want to purchase the home, you keep the premium.

If somebody really likes your home at the price you were willing to accept but the financing didn’t work out for them, they may lease your home to lock in the price while repairing their credit or saving more money for the downpayment. Similar to renting, do a thorough background check before committing to the deal.

Short Sale

A short sale is when the bank or lender agrees to take less money for your home than what is owed on it. The mortgage company doesn’t want the expense of a foreclosure so they may be willing to take a settlement if you’re in pre-foreclosure. Short sales can cause severe damage to your credit so they should be avoided whenever possible.

An underwater mortgages is a reality for many homeowners but there are options to help. Your home has the potential to be an income generator for you so think outside of the box before allowing your credit to be destroyed by a foreclosure.

Related Posts:

• Should You Use A Real Estate Agent To Sell Your House?
• Owning A Home – Be Prepared For The Expenses
• Less is More: Cheap Home Upgrades that Offer a Big Payoff

Four Ways to Deal with a Home That Won’t Sell originally appeared on Canadian Finance Blog on November 28, 2011.

Here we’ll look at 3 common personal finance beliefs and dispel the myth behind them.

Myth: A credit counselor is required to repair credit.

This is not true. You can repair your own credit using patience and fortitude. Credit companies can help, but they can virtually do nothing that you cannot do yourself. The first thing is to order a free credit report. Northern Credit will give you one free report per year while TransUnion Canada and Northern Credit Bureau will provide them as requested. Report any errors in writing to each of the agencies. You can contact credit companies and work out a plan that can fit your income. You must be willing to show income statements, a budget and a plan. You may be able to re-negotiate the debt.

It is a myth that by closing accounts you can get more credit score points. Dropping a card may actually reduce your credit. It’s important to show that you are paying off credit with credit on time. If you already have or wish to apply to get airmiles card, it is one of the best reasons for having a credit card as it allows appreciation in travel miles. Do not get a new credit card if you are already in debt.

Myth: Interest rates will rise. This is the time to buy a house.

The Canadian housing market has been robust, resilient and growing. It has managed to remain outside the speculative quagmire that has snarled housing sales for our southern neighbour. The Canadian Real Estate Association changed a previous negative sales forecast to now show a 1 percent increase in sales, predicting 450,800 homes for 2011. CREA has reported only a 1.6 percent drop in sales from a year ago same period. The current average sale price, $363,500, represents an annual 7.2 percent increase, with the Vancouver market driving the lead.

Would one be desperate to rush into the market while interest rates are at their lowest? The Toronto-Dominion Bank reports home inspection rates and mortgage pre-approvals are several points down from last year. The Manpower job outlook for Canada, backing up home sales, appears positive.
This may very well be the time to get into the housing market. Due diligence must be pursued. Investigate and compare rates across the various provinces. One must understand that the Canadian economy is also part of a world macro-economic frame that is still under correction.

Myth: A college education bears multiple values.

Total student debt has been estimated at $20 billion, and student loans owed to the government increase by $1.2 million daily. With tuition rates uncharacteristically rising, up to 27 percent of students graduate with over $25,000 in debt. Defaults on the 8 percent government loans can easily compound a $30,000 loan into a $60,000 debt.

Graduating students are being forced to delay careers by taking up low-paying jobs outside their specialties. With no opportunity to build individual wealth, these students are unable to obtain credit to buy automobiles or homes.

Is college the way to go? A family’s personal finance figures importantly on planning foreseeable costs for college education. While some pundits point to a job market demanding college degrees or diplomas, others are saying the resulting student debt burden outweighs the benefit.

There’s a variety of non-repayable resources available when planning for education, just as there is a line of thought that a worthwhile profession can be obtained outside college. The family or individual must take a detailed, personal look at career prospects before committing financials or signing loans. Get a copy of “Canada Job Trends Update 2011” and go to the Working in Canada government site, among others, to obtain practical views of job outlooks

Related Posts:

• Recommended Personal Finance Books
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Dispelling 3 Personal Finance Myths originally appeared on Canadian Finance Blog on September 1, 2011.

Whether you make it a side project or do it as pastime, house flips are an exciting activity that can be highly profitable if you know what you’re doing. You can engage your family as well, if you like.

The principle may be familiar to you from various reality shows or TV programs. To flip a house means to purchase a run-down property (a condominium unit or a house), invest in its renovation, then sell the renovated property to an end-buyer for profit.

As you may expect, location and timing are everything. Of course, merely making the necessary repairs and upgrades usually pays off generously, but the real potential is in the planning of the transaction. If you expect that a neighbourhood will become more popular in the future, you’ll do better flipping a house there than doing the same in a declining neighbourhood. If you think that the market will pick up soon, get your house now so that it’s ready for the hype.

The real cherry-pickers will meticulously seek old or abandoned houses in prominent neighbourhoods and snatch any shabbier house that has posh neighbours. Not only does this approach often maximize the return on investment, but the neighbours will be happy to see that the dark spot of their home area will receive a facelift.

A professional real estate agent experienced in house-flipping will be a great boon when you’re looking for good candidate houses. (Learn more about investing in Calgary real estate here.) Not every Realtor® is skilled in this technique and few are true specialists. Those who are, however, do it because they love the adventurous nature of flips from the bottom of their hearts — just like you do.

Once you’ve found a promising house and secured the necessary funds, it’s show-time. First, you must master the technicalities of the repairs, such as maintaining the stability of the house, engineering requirements, and liveability standards and appliances. While you’re figuring this out, your family can help you mow the lawn in front and behind the house, remove broken windows and doors, or locate all the loose bricks or floor pieces. Of course, you can pay somebody to do it, but it’s a great opportunity for a bonding experience and, in the end, you will have achieved something together. Once you’ve “prepared the workplace,” you can call in the professionals to take care of the house or condo and get it back in shape.

After the hard work has been carried out, you can engage your family in picking the colour scheme for the interior and exterior and deciding how to decorate the yard or the driveway so that it appeals to potential buyers.

Sometimes, your Realtor may be interested in chipping into the repairs in exchange for a share of the final margin. This might ease the financial burden for you and allow you to perform more extensive repairs than you could fund by yourself. Ask your agent whether he or she is interested in such arrangements.

Author Bio: Written by David Tsegai of Calgary Real Estate, a real estate firm specializing in property investment in the Calgary area.

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This Is Flipping Fun! originally appeared on Canadian Finance Blog on August 8, 2011.

So we knew we were going to end up moving by the end of the month. What we did not know is that we were going to be moving to Vancouver Island, a full week ahead of the end of the month. Suddenly we went from having all the time in the world for a relatively simple move, to having absolutely no time and a huge cross-ocean (technically) move. To further complicate things, we are not moving into our new place, we will be moving into a storage locker and will be living out of our car and off the generosity of friends and family for a few weeks before we find a place to settle down in. Yikes!

So as soon as I knew we were moving, I immediately set about doing what I always do with these large things. Researching. A quick google search of “how to move” lead me to a number of relatively generic lists, but it was good to start somewhere, and I knew it might help jog my memory of things that actually needed to be done. The scariest part, however, was finding out that half of these lists started with “two months prior to the move…”. Yeah, our timeline was suddenly about two weeks from making a decision to having to be gone, so it would be significantly shorter. Throughout the last week or so, I’ve learned a number of ways one can save a lot of money by planning out ahead of time a few things, and timing them accordingly.

Eat Through Your Freezer

I’ve written a whole other post on this subject, and if you plan on doing this, right before your move is the best possible time. Go through your freezer and write down everything that is in it. While you’re in there, toss anything that’s been in there for longer than a year, and anything else that might be suspicious. You don’t want to risk food poisoning just before you pack up your truck to move. Now start planning all of your next few weeks or month’s meals around the things that you have in the freezer. The point is that, if you time it right, you can have an empty freezer and a slightly fuller wallet by the time your move rolls around. We, unfortunately, were not able to accomplish this task. We’re doing the best that we can, but I can only eat a certain number of bulk bagels a day!

Time Your Rentals

Right at the end of the month and the beginning of the next is always the busiest time for rental trucks, moving companies, and storage lockers. If you can move at a different time of the month, you stand a much better chance of getting a vehicle reservation that the company will actually honour, and you might even find a deal or two. The storage place that we are moving into is currently having a buy one month get the next free promotion. So because we are moving into it at the end of the month, we get a pro-rated cost for the remainder of the month, and the next free. We essentially get a month and a bit (all that we will need) for the cost of less than a third of a month.

Coordinate With Your Employer

The summer season is the time of the year where my job is in most demand. Everyone is looking to take their vacation in the summer, so if you haven’t booked holidays it is all hands on deck. Therefore, planning a move right around the busiest time of the season is less than ideal. If you can, try to time your move around your already booked vacation time, or do it during a slower season so that you can take a few days without bothering anyone.

Tell Your Life To Calm Down

Moving is stressful. Even easy moves just down the street still require you to pack everything in your home, coordinate friends and family to help as they can, moving truck rentals, unexpected costs, and plenty more. If possible, plan to move when the rest of your life is as low-stress as possible. Have a major life change coming up? Perhaps wait to move, or get it out of the way ahead of time. I don’t recommend trying to move while also looking to change you and your spouses’ jobs, for example, or just after you had your first kid. Let the dust settle, and then consider moving. Moving requires a clear mind and heavy problem solving. Too often when you are stressed you do quick impulse purchases to fix problems, rather than taking a slightly longer road to get to the same end cheaper. Try to avoid these costly decisions by moving when you have less on your plate to deal with.

How have your moves been timed?

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Timing Your Move originally appeared on Canadian Finance Blog on July 20, 2011.

People do make big money in this area of investment, and it’s not by accident. Successful investors are those who know how to deal with all aspects of investing in property, including neurotic housing and rental markets and dubious-looking investment propositions.

Property investment basics

There are two common streams of residential property investment:

• Housing sales- The commonest form of investment, and theoretically straightforward, this is a high-capital investment, dependent on market moves.

• Housing rental- A revenue-creation approach to investment. Also the primary revenue stream for portfolios of properties.

It’s no exaggeration to say that you must be thoroughly conversant with all the issues related to either form of investment, right from the start.

Purchasing an investment property

Successful investors buy properties based on their potential for returns, either as direct sales profits, revenue potential, or both.

To assess the value of a property for purchase, you need:

• An accurate valuation of the market price and the upside potentials of the local market. This also means valuation of the downside of a property, the lower market prices in that area for that type of residence. The real value of a residential property is typically somewhat lower than the market top, and an averaging of similar properties provides a more reliable indicator of a price.

• Costing of your intentions regarding property development, upgrades, renovations, and other works. This valuation should be conducted on a real-cost basis, including legal and other fees. Important: Always consider these costs in terms of their relative value to your purchase, because you aren’t going to realize the capital value of improvements until sale or rental.

• A clear view of local market conditions- This is very much a risk management process. Assessing the market movements involves looking at price moves in recent years. A 5% return on a property isn’t a particularly good investment performance, and you could get far better returns in other markets.

A good investment property, defined

A really good investment property has some clear characteristics:

• A good local market- Meaning clearly consistent performance over time with regular demand, (check auction turnover figures) and no doubts about price downside. The ROI in these areas is usually excellent, and you don’t get stuck with an unsalable property.

• High quality premises- Forget entirely about the “handyman’s dream” properties or any rundown looking places, unless you’re an expert. Those properties can cost very big money to fix, and the choice is either deep pockets or demolition.

• Clear upside on sale price- The evaluation process shows the median price range and you can assess your capital return potentials quite accurately. A return of 8-10% is viable, under that is debatable.

• Good rental market- The right property has locked-in value as an income stream.

These are all quality controls on your investment. Get the strategy right, and you’ll get your investment moves right.

Author Bio: Tom Mallet is an Australian freelance writer and journalist. He writes extensively in Australia, Canada, Europe, and the US. He’s published more than 500 articles about various topics, including property investment and investment property.

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Residential Property Investing For Beginners originally appeared on Canadian Finance Blog on June 13, 2011.

We currently live in about 900 square feet, and we use every inch of it. Our storage cupboard is full to the point of bursting, our closets are full, and our outdoor space is packed. After two years of wedding presents, purchases, and new furniture, we have filled the space that we live in. So when we started looking for a new place to live, we knew that we would need at least 900 sq ft, plus outdoor space, in order to put all of our stuff. Once we realized that we would probably end up paying 30-50% more each month in order to keep that square footage, we had some more conversations and came to the conclusion that perhaps we should try to live in a smaller space.

This, to me, is the easiest and simplest way of explaining that my stuff costs me money. It doesn’t just cost money to purchase it, it costs money to store it, maintain it, move it out of the way, move it back again, and relocate it. It might be hard to put a particular price on any of these things (just how much money is your time worth? What about your energy? What could that space be used for otherwise?), but the simple reality is that if you own less stuff, you have more money in your pocket.

The simple reality is that I love to be at home. I like to be comfortable, well fed, and entertained. For me, there is hardly anything better than going home after work and relaxing for the rest of the afternoon and well into the evening. I do not become bored if I am left at home, sometimes for days on end. In addition, my wife loves to cook and to bake, and those things take up a significant amount of room in the kitchen. A small apartment sized kitchen is difficult to deal with when those are two of your main hobbies, and the room in which you spend most of your time. Therefore, we have, to this point, been okay with spending more money on our living space, and therefore, more money on our “stuff”. Faced with the realities of the housing market, however, we have been forced to make a tough decision, and as mentioned, will be temporarily trying to live intentionally in a smaller space, and therefore, at a smaller cost.

In order to deal with the transition, one of the things that we will be doing over the next few weeks is to start packing – but with two intentions. The first being the things that we will be bringing to our new place. These are things that we have been using everyday for the past two years. Our computers, TV, certain kitchen appliances and clothes, for example. The other intention will be to pack things away that we don’t regularly use. I know that I could go through my closet and pull out 30% of my wardrobe because I haven’t worn any of them in 6 or more months. Why would I waste my time and energy bringing them to my new place to not wear them there? I know that a lot of the things in our storage closet are just that – storage. They aren’t regularly used, and while we can’t exactly throw them out or give them away, they don’t need to be stored in our new place. We may attempt to unload some things at family or friend’s houses, or we might look into renting a storage locker for a few months. Our outdoor furniture, while useful, will serve no purpose at a place with no outdoor space. Again, we may simply put it away for a day when we do have a patio again, or we may get rid of it altogether.

While none of these decisions are easy ones, they are ones that could result in our family saving some money, and during this point in our lives, that is what we have chosen to pursue. What tough decisions have you made that have saved your family some money?

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Your Stuff Costs You Money originally appeared on Canadian Finance Blog on June 8, 2011.

Here’s 13 reasons your rental suite is still empty.

1. You didn’t post pictures

While some of the best places that we’ve found so far were listed on craigslist without pictures, not including photos is an immediate turn off. If you are going to post your rental suite on craigslist, include photos. If you don’t, I am going to wonder what you are trying to hide. It is not like you are going to trick someone into living in your place, so not including photos just seems lazy.

2. You didn’t show up

When you agree with someone to view your suite, do everything in your power to be there. While I have yet to be stood up, I have had to wait 15+ minutes for a landlord to arrive. When you are trying to view 5 or 6 places in a row, being put 15 minutes behind schedule meant that I was now late for the rest of my appointments.

3. You were unable to make time for an appointment

If you advertise your suite is for rent, expect people are going to want to come by and take a look at it. Don’t, for example, put up a posting on craigslist and then immediately leave town for 3 days. You will receive phone calls about your suite, and saying, “well, maybe next week” is not an acceptable response.

4. The rental suite is dirty

Granted, as a landlord you don’t always have control over how the suite will look like if you still have your current tenants living in the rental area. However, you can most definitely make the request that they keep it as clean as possible. I know of a couple of landlords who have “sweetened the deal” by offering a month’s free rent for keeping it neat and tidy, or in our case, a bottle of wine per showing.

5. You were dirty

Even if you can’t fully control how the suite looks, you can definitely control how you look. I’m not asking for a suit and tie, but I do expect that you are wearing appropriate attire. I was greeted by a landlord that seemed to have just woken up, as they were still in their pyjamas. I was also shown a suite by someone who was wearing clothes that were absolutely filthy. If you look filthy, I expect the area you occupy to also be dirty. That does not make me want to live in your space.

6. The pictures you posted are misleading

This one was really frustrating. I totally understand that you want people to look at the pictures and think “I want to live there”. However, when you start taking pictures from angles to mislead people into thinking that they are getting space that they actually aren’t, then all you are going to get is a disappointed potential tenant. The suite we saw looked big – because the photos were taken from the hallway outside the rental space, giving the illusion of larger rooms and a hallway. Even worse is photos of how the suite looked before it was lived in by six teenage boys, or photos that are so dark it is hard to tell what exactly is in the picture.

7. Your suite is illegal

I don’t exactly know building code off the back of my hand, but I do know an illegal suite when I see one. If, and when, I do walk into an illegal suite, I look around, and then I walk out.

8. You are asking too much

I totally understand that you are willing to wait for the right buyer. I also totally understand that you just put a lot of money into the house or renovations for the suite. However, if you are asking for a $300 premium for the privilege of living in your home just because you lack a grasp on the housing market, don’t expect people to be banging down your door. You will lose even more money not renting out the suite rather than renting it out at a fair price.

9. You’re a nudist

…

10. You don’t speak English

I live in a very multicultural area. However, if you post an ad in English, and have an English sounding name, then I feel like it is your responsibility to ensure that the person who answers the phone number you listed actually speaks English.

11. You don’t leave a contact phone number

I totally understand that you are afraid of receiving spam telephone calls from telemarketers if you post your phone number willy nilly all over the internet. However, if I email you and ask you to phone me and I leave my phone number, then I expect you to call me. Or, if you do choose to email back, because I left my phone number, I expect you to leave yours. It is hard to sit outside someone’s house, hoping it’s the right one, sending an email to confirm just because you don’t want to give anyone your phone number.

12. You list inaccurate measurements

I’m not in the construction trade, and to be honest, I very rarely calculate square footage just for the heck of it. However, do not just estimate that your place is 1000+ square feet. If your ad lists 1000+ sq ft, then I expect 1000+ sq ft. Not two 6×10 bedrooms, a bathroom where you can’t close the door if you are sitting on the toilet, and a kitchen that has four cupboards. If you list the square footage (and you should), you should measure it first. Even better, list the dimensions of each of the rooms!

13. You list an inaccurate price

Only $950 a month! your ad screams. However, that doesn’t include you having to pay for utilities, which is another $150. So really, rent is $1100, you just didn’t want to list it. If you are expecting your tenants to pay for utilities, just list it in the price. Or, if you are doing a percentage of the utilities, make that clear up front as well.

In the end, all tenants are really looking for is a good, honest deal, with a good, honest landlord. Anything to make your place seem better than it actually is will simply put off most potential tenants – or at the good ones. Do everything you can to be as upfront and clear in the beginning, and you will ensure that you get yourself a good tenant.

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13 Reasons Your Rental Suite Is Still Empty originally appeared on Canadian Finance Blog on May 25, 2011.

Get a Feel For the Market

If you have the opportunity to know that you will be moving in advance, take advantage by getting a feel for the market. Perhaps it has been awhile since you have checked out the average cost of rental suites, and perhaps the going rate for certain amenities has changed. Browse through your local newspaper or craigslist, call a few places that you might be interested in, and perhaps a few that are out of your price range or ideal location. See what you can get for what price, and keep notes on the places that you are going to. While there are bound to be a number of landlords asking for a lot more money than their place is worth, you can get an idea of what you can get within your price range by visiting a number of places before you actually have to make a decision.

Make a List

The next thing that you ought to do before you start seriously considering rental suites is making a list of needs and wants. Needs are absolute must haves – things that the place you rent has to have in order for you to consider living there. This could be anything from number of bedrooms (if you have children, etc), whether or not it has access to a dishwasher or laundry, size of the suite, or anything else that you feel is critically important to you living there. Doing this ahead of time will help keep you in check when you find that absolutely beautiful modern wonderfully located apartment – that just so happens to be 350 square feet. You and your three children may not enjoy it as much once you move in.

View Rentals, Keep Notes

If possible, start looking for your new place as early as possible. If you have the choice of moving whenever you would like, you have the benefit of being able to say no to a lot more places than someone who has to move within 3 days. So start looking at soon as you possibly can, at least six weeks if you are able. After you view a place, write down notes about the size of the suite, the number of bedrooms, the rental cost, and the contact information. All of this will add to the list that you hopefully already made giving you a good idea of what is a “good deal” in your particular location.

Make a Renter’s Resume

In certain markets, you have to distinguish yourself from other applicants, just like when you are applying for a job. So set yourself apart by creating a renter’s resume. List your previous dwellings and landlords, as this is information that will probably be asked of your anyways. Also include what you’re looking for (long-term, short-term), as well as your current job, or other income. Add whether or not you smoke or have pets. Being able to simply hand the owner a sheet of paper with all this information is a lot easier than hoping that they remember when you call and ask for a place.

Wait For a Deal

Every landlord is different. Some are just hoping to make the most money possible, so they don’t care who they rent it to as long as they are able to pay the money every month. Others are not at all concerned about whether or not they are making the most money, as long as their tenants fit with them and their lifestyle. If you are the type of person that is considered a good tenant, it might be worth holding out and looking for a place that values quiet, long-term tenants over maximal money. Our current landlords intentionally kept the price of their suite low so they could pick whoever they felt would fit the best. If you have the option of waiting to find the right fit for both you and the landlord, you can bet that you will end up getting your money’s worth.

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How to Find the Best Rental Apartment originally appeared on Canadian Finance Blog on April 27, 2011.