Rent Your Home in Vancouver

Rent Your Home in Vancouver

The decision of what to do with one’s largest asset is not often as simple as “buy” or “sell”.  There are many factors to consider when re-evaluating a previous homeownership decision.

Smaller properties like apartments and townhomes are more often thought about as investments for rental purposes, but single-family homes can also be used for this purpose.  In many areas, demand is high for rental homes and with a limited supply, the return can be quite attractive as tenants may be prepared to pay substantially more for a property that can accommodate their entire family with pets.  Home rentals in many Vancouver suburbs and neighbourhoods are generating anywhere between $1.50-2.50/sq ft per month.

In addition to the rising rental returns available in a tight market, there are other factors to consider.  People are often put in a position where living in the home they have bought is temporarily inconvenient.  Some are offered jobs across town or even overseas.  Others need to relocate closer to a relative in need of care.  We often see retirees thinking about downsizing, but unsure of whether they’re ready.  Or baby boomer parents who wish to keep the family home for their children’s use in the future.

If you are attached to the home and area you are living in and the temporary reason for moving will likely have you back again, why go through the headache of selling the home and then trying to find something similar again?  Transaction costs alone could be significant, not to mention furnishing the new home and customizing it for your needs via renovations.

Renting your home for a few years may turn out to be a more economical decision than going through all that hassle, but who would I be renting to and how is my home going to look when I get it back?

To Whom Should I Rent My Home?

We see all sorts of interesting individuals and families that prefer renting to owning.  Some are overseas visitors, here temporarily to visit relatives or work.  Others just don’t want to have a home restrict their job mobility, or want to invest their savings in something other than real estate.  Some self-employed people are not able to get mortgages at the most favourable rates, so they can rent a larger and nicer home than they could afford to buy.  People renovating or rebuilding their own homes are also in need of accommodations that are not dissimilar to what they are accustomed to.  Those in these situations and others don’t fit the typical stereotypes of renters as transient, low income earners, or those with damaged credit.  More often than not, our applicants for multi-million dollar properties are more than capable of taking care of your home the same way they would if it were their own.

If you would like more information on renting your home, or would like to receive a rental evaluation of your property, please contact me.  Our team and industry contacts can help you decide what the best decision is for your situation.

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Vancouver Rental Market Statistics

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This is the third post for this little project.  I am attempting to track Vancouver rental market statistics for houses, duplexes, townhomes and suites within houses on the North Shore. First, a disclaimer: these numbers are not intended to be instructive for the setting of rental amounts.  I strongly urge you not to use them for that purpose or in making any other financial decision.  There is not enough data available to create reliable statistics in this market, and the methodology is unscientific.  Instead, you should rely on the local market knowledge of a licensed Rental Property Manager for advice.

Methodology: Craigslist is the only source being considered for the time being.  I am filtering for properties that have 3 bedrooms or more and with a minimum price of $2000/month.  Apartments are not included.  Whether a rental property is furnished or unfurnished is not considered.  Properties with incomplete information are not included.  Listings that appear to be scams are also excluded.  Listings are collected from the 7 days prior to this post.

Additional info: Both median and mean numbers can be skewed by just a few listings.  Values in one neighbourhood could be vastly different from those in the adjacent neighbourhood.  We are tracking listing prices.  Actual rental prices could be different for each property.  I will start this by focusing on North and West Vancouver only.  If it remains an interesting exercise, I may expand it to include areas of Vancouver proper. Data collected from February 23rd-March 1st.

Notes:

Any month/month changes do not allow us to draw any conclusions.  We won’t know how accurate this is until we see many months of data.  Theoretically, unique listings should be rising due to seasonal effects, but we have not observed that as of yet.  Anecdotal evidence of tight rental market conditions confirms a general rise in rental asking prices.  However, the rise in median rental prices for North Vancouver vs. our March numbers are noticeably skewed due to fewer listings at the lower end.

Numbers also appear to have a bias to the upside due to excluding properties under $2000.  I will consider similarly excluding ultra high-end properties ($15, 000+) going forward to see if that provides a more useful set of data.  Once again, this is a work in progress.

Vancouver Rental Market Statistics – April, 2015

Rental Market Number of unique Listings Mean Rental Price Median Rental Price Avg. Price per Sq Ft.
North Vancouver  53  $4, 258  $3, 875  $1.80
West Vancouver 72  $7, 298  $5, 000  $1.92

 

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Rental Home Staging

In order to maximize your potential rental income, it is important that your home shows well to tenants browsing for their ideal home.  There is a common misconception out there that homes which are “just for rental” don’t need to be maintained to the same standard that an owner would expect.  This is often not the case.

While spending 10’s of thousands of dollars on renovations might not be recovered with a higher rental amount, an argument can be made to expend some resources on ensuring the most important parts of the home receive some TLC.  At the higher end of the property market, professional rental home staging may also be appropriate.

The kitchen is by far the most important room in the house in terms of “make-or-break” decisions for tenants. It is often the space that receives the heaviest use.  The kitchen is often a gathering spot for families and guests.  If tenants are embarrassed to have guests see their kitchen, it can be a major deterrent to them renting your home.  Flooring should be somewhat modern and at a minimum clean-looking, likewise with the major appliances.  Counter space is not always something you can control, but generally, the more the better.  Double sinks, garburators and dishwashers are hugely beneficial to some families that do a high volume of meal making.

The bathrooms in the house are similarly important for many.  Few are willing to use a bathroom with mouldy caulking around the fixtures, shower heads and taps that barely work, cabinets that are disintegrating, or toilets that look like something from the Victorian age.  A bathroom can receive a significant upgrade for a very reasonable expense.

In deciding what to upgrade prior to offering a rental home, you should be considering how long you expect it to be a rental.  If it is a long-term plan of yours, then increasing your rental income potential by 20% could make it very worthwhile to expend $15, 000-25, 000 on upgrades at the outset.

Other Rental Home Staging Considerations

Of course, there are other considerations worthy of attention.  Ensuring that the home is clean and without any residual smells from previous occupants  is very important.  Walls might need a fresh coat of paint, carpets might need to be cleaned and things like door handles and light bulbs should be uniform throughout the home.  Yards should be landscaped at a minimum level and any clutter removed that might make spaces look smaller than they really are.

Taking some of these steps will go a long way in staging your home appropriately to attract the best tenants possible.  Of course, you should seek the advice of a Rental Property Manager to advise on what makes the most sense to focus on, and whether your expenditures are likely to be recovered.

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