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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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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Should I Allow Pets In My Rental Home

 

Whether or not to accept tenant applications with pets is an issue that every landlord has to ask themselves before listing their property.  The usual response to the question is a direct “no way”.

Of course, there are good reasons for this.  Who would want to take the risk that someone’s poorly trained cat or dog is going to inflict significant damage to their home – beyond what can be recovered from pet and damage deposits?  A high-end wood or laminate floor could require refinishing or replacing from excessive scratches.  Carpet could get stained and destroyed.  The smell of pets can linger for weeks or months after they move out, potentially scaring away future tenants.  All sorts of horror stories can be thought of without much effort.

However, even with all of those risks, offering your home to potential tenants with pets might still be the correct course of action.  Why?  A few reasons.

First, if other landlords (your competition for good tenants) are also forbidding pets, then you are increasing the pool of potential candidates.  By how much?  Based on a poll and using 2006 census data, 36% of Vancouver households have a dog.  National numbers put a similar number of homes with cats.  If we assume at least half have both cats and dogs, then over 50% of households have either a cat or a dog.  It wouldn’t be unreasonable to increase that number in suburban areas that are more pet-friendly environments than the downtown core, for example.  Suffice to say, you are at least doubling the number of potential tenants by keeping an open mind about allowing pets.

If so many other landlords are forbidding pets, the law of supply and demand dictates that the price you are able to receive for a pets allowed property is very likely higher than otherwise.  More people chasing fewer properties will drive the price of those properties higher.  Expecting a 10% increase in rental income is not a stretch.  With this added income, in addition to the protection of damage and pet deposits, a good justification can be made to allow pets.  Just a couple years could cover the cost of completely re-doing your flooring, should that be necessary.

Another reason for considering pet owners as your tenants is not as easy to quantify.  It is commonly held that pet owners (dog owners in specific) are more reliable, and more responsible than those without a furry friend.  While this certainly doesn’t hold across the board, there is some element of truth to it.  A pet can be a stabilizing influence.  Drug addicts, transients, and those without stable employment can’t usually care for a pet.  But those with pets are more likely to be in a stable life situation – a good quality for tenants in general.

Nothing beats meeting a pet face-to-face, however.  An experienced property manager will always want to meet the pets, like they want to meet the family.  How does the pet behave?  How does the owner project their expectations, and what is the reaction?  What is its breed and disposition?  How old is it?  Well-trained dogs are easy to distinguish with poorly behaved ones.  A pet owner will almost always describe their pet as well-behaved, quiet and friendly.  But nothing beats seeing for yourself.  Just one more reason to have a property manager on your side who knows what to look for!

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Should I Rent It Furnished

I am often asked the question whether it is better to rent a home furnished or unfurnished.  While there is no standard answer to this question, there are pros and cons to both that you should be aware of.

Furnished properties are convenient for a very specific type of renter – usually an out-of-towner that is only here temporarily.  These candidates might be very happy to forgo buying furniture, and they are often willing to pay a higher price for that convenience.  People in the film industry and mining industry often come to Vancouver and have their accommodation prearranged for them by their employer.  If you have a property that is attractive for these purposes, offering your home furnished could yield very good returns.

However, these types of people can be few and far between.  And for certain types of properties, they are almost non-existent.  If the goal is to have your home rented on a long-term basis and with the least possible potential for headaches, furnished properties are rarely a good choice.

In addition to shorter terms and worries about your precious artwork or new Natuzzi sofa, a furnished property isn’t always going to attract a higher gross monthly rent.  Why wouldn’t something that comes with more bring a higher price?  Because we are a nation of consumers.  Most of us have accumulated many belongings over the years – we like them and want to keep them.  Renting a home furnished means they would have to pay to put their things in storage.

For this reason, unfurnished properties are often in higher demand, and with a larger pool of potential renters, the amount of gross monthly rent you are able to realize is sometimes higher than the same furnished property.

Luckily, you don’t have to make a concrete decision!  Properties can be advertised to be available both furnished or unfurnished.  You can also negotiate to leave certain items for the tenants in return for some consideration.  By doing this you can maximize the potential pool of renters and your return on investment.

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How To Avoid Rental Scams

With recent stories like this and this in the news about unwitting rental hunters being scammed out of their deposits, now is a good time to review some precautionary steps to take.

There are a few variations of the scam, but most have gone something like this: prospective tenant comes across ad posted on Craigslist, they inquire with the number posted at which point they’re told to submit an application and a deposit.  If the tenant asks to see the property first, the “property management company” impersonates a buyer’s agent to gain access.  Again, a deposit is requested “to secure the rental.”  The ad disappears, the phone numbers are no longer in service and the property turns out to be not for rent at all.  The deposit goes “poof.”

Craigslist is indeed a good place to look for a rental property.  It has the largest inventory of properties under the same roof.  Most legitimate property management companies (including Orca Realty) post their listings on their own website and on Craigslist as well.  It is impossible to ignore the number of eyeballs it attracts.  For a property manager to not utilize this resource, in most cases, is a disservice to their clients.

So, as a renter in search of a property, how do you best protect yourself against fraud?

– Ask questions, lots of them.  If the property manager cannot give coherent answers, chances are he/she hasn’t been to the property.

– Ask to take a picture of the property manager’s identification (driver’s license) and ensure the name matches with that of their business card.

– Always view a property before you sign a contract.  If you are forced to rent sight-unseen, try to have someone else view it for you (this is what relocation specialists often do).

– Do not pay a deposit until you have a copy of your signed tenancy agreement.  Many property managers do want to ensure your ability to pay (especially for luxury properties) by asking for your first month’s rent and damage deposits before the move-in date.  The Residential Tenancy Act does not allow them to ask for anything beyond this.

– Ask to visit the property manager’s physical office to arrange for the signing of a tenancy agreement and payment of your deposit(s).

By taking these steps, you will ensure that any potential scam artist sees you as too difficult and they will simply move on to an easier target.  Do alert the police if you feel you are being targeted by one of these scams.  Happy hunting!

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