Rental too high

[OldIslander]

The price of anything -- any service, product, rent (business or home) -- is set by one thing and one thing only, and that is supply and demand. If there were lots of rental units available, and demand was low, rents would be much lower. But right now, there is a shortage of rental units, and a lot of demand -- ergo, record high rents.

In Canada, there is little incentive for investors to create more rental units. The tenancy regs make it almost impossible for owners to deal with bad tenants. Who in their right mind would want to invest millions in low or medium cost rental units, when their hands will be tied, dealing with some of the miscreants who will rent them. The landlord is usually portrayed as the evil, money grubbing villain in the media. Seldom do we hear about the horrors of bad tenants.

There are many, many different ways investors can put their money to work, rather than endure all the ugly hassles of the rental market. Who are we to tell successful people who have earned wealth, how they must invest it? If we make it too difficult to earn a return of their rental investments, they'd be dam fools to invest in the first place.

There are many bad landlords, too. But when the pendulum swings -- supply increases and demand falls -- it's the bad landlords who will lose their tenants first, and the good landlords who will retain theirs. Although that's not much comfort to the folks who are struggling to find a place now.

[forum]

Fact of the matter is, someone screwed up big time regulating housing in Canada. Its completely messed up right now.

People look at debt like it's a complete joke. Have $700K in debt? Pfffft...who cares. Let the kids pay for it.

[dominik]

Fact of the matter is, someone screwed up big time regulating housing in Canada. Its completely messed up right now.

People look at debt like it's a complete joke. Have $700K in debt? Pfffft...who cares. Let the kids pay for it.

It appears to be that way, considering real estate is now Canada's primary industry, ahead of forestry and tourism. Speculation into real estate to the extent which it was allowed has definitely caused a dangerous upset throughout Canada's real estate market.

@Even Steven,

Maybe I should have clarified, willing should be more along the lines of ability (and choice to pay more if able), whereas being forced to which equates more to having no choice, paying or being homeless regardless of affordability. The latter now being what actually controls the local and national rental market.

It should be seriously concerning when the Bank/Mortgage stress tests are performed and the results come back with nearly 1 in 3 Canadians not being able to afford their "Mortgaged" home. The new regulations coming in do seem pretty strict however I think they may bring back some stability.

I should also point out that this is by no means simply a Canadian problem, we are seeing similar situations at different levels throughout Europe and South America as well.

[Even Steven]

Maybe I should have clarified, willing should be more along the lines of ability (and choice to pay more if able), whereas being forced to which equates more to having no choice, paying or being homeless regardless of affordability. The latter now being what actually controls the local and national rental market.

No, you don't have to explain it, I get what you're saying. I've never thought about this way, but I do appreciate where you coming from.

But let me ask you this.

You have a house to rent out. You put an ad in the paper. Somebody calls and wants to rent it and asks how much it is - you say $2,000/month. Are you supposed to ask them at that point if they can handle it? Or you're supposed to ask what they're willing to pay for it? I just don't see how you'd implement this in an any meaningful way. I really don't see how you can put this into practice.

But good for you thinking of something besides dollars and profit, I'm not able to think that way, so I appreciate your input.

[dominik]

Maybe I should have clarified, willing should be more along the lines of ability (and choice to pay more if able), whereas being forced to which equates more to having no choice, paying or being homeless regardless of affordability. The latter now being what actually controls the local and national rental market.

No, you don't have to explain it, I get what you're saying. I've never thought about this way, but I do appreciate where you coming from.

But let me ask you this.

You have a house to rent out. You put an ad in the paper. Somebody calls and wants to rent it and asks how much it is - you say $2,000/month. Are you supposed to ask them at that point if they can handle it? Or you're supposed to ask what they're willing to pay for it? I just don't see how you'd implement this in an any meaningful way. I really don't see how you can put this into practice.

But good for you thinking of something besides dollars and profit, I'm not able to think that way, so I appreciate your input.

In reality as a landlord you'd have to at least ask yourself that question, otherwise you could be ending up with rent payment delays or in the worst case lost rent payments. In essence that is where credit checks come in. I think the long term impact will be on the communities, through less money being spent which will in the end cause an upset that will force some sort of action in the communities.

The only way I see to enforce rent management policies is through rent control, which is naturally not a very welcome subject and it does bring potential downsides which are more community based (can create marginalized neighborhoods etc.), rather than just financial issues.

The issue is very complex and I wish I had all the answers, all I can do is try to analyze the situation and try to improve upon it somehow, either through education or personal action.

[Ka-El]

I have to say I am sure glad that I am not renting anymore. Housing costs are not going to go down by any appreciable manner anytime soon. As much as you pay for a home now, you can bet it will be worth substantially more in twenty years (how much rent will a person pay in that time). At the same time, rents are also just going to continue to increase as the demand for housing continues. I know it is not easy, but it wasn’t easy twenty/thirty years ago either. Getting into a home and out of the renters pool is part of a sound long term financial plan and part of the path to ultimate financial independence.

[Sige]

When we bought our duplex, it came with a renter in place - a single mum putting herself through university. She paid $600/month in rent. I was also a single parent myself in my earlier years and I knew what it's like money-wise. We told her that as long as she was going to school we would never raise her rent, that she could depend on it being the same, no surprises down the road. It was my way of helping someone out. When she graduated four years later, we gave her a month rent free as a grad gift. She's now a social worker in Victoria and is doing very well.

I don't fault people who charge as much as they can for their rentals, but I personally couldn't do it - I don't want a ton of money for our suite. I'm happy enough to get enough to help out and retain *good* tenants.

[forum]

I have to say I am sure glad that I am not renting anymore. Housing costs are not going to go down by any appreciable manner anytime soon. As much as you pay for a home now, you can bet it will be worth substantially more in twenty years (how much rent will a person pay in that time). At the same time, rents are also just going to continue to increase as the demand for housing continues. I know it is not easy, but it wasn’t easy twenty/thirty years ago either. Getting into a home and out of the renters pool is part of a sound long term financial plan and part of the path to ultimate financial independence.

Lucky for me I can just keep cranking my rates up to match the mortgage costs. A night out at McDonalds in Kelowna is going to be $75 soon.

[Ka-El]

Lucky for me I can just keep cranking my rates up to match the mortgage costs.

how much are you charging to mow lawns now?

[Grandan]

Kelowna's housing crisis:
https://www.castanet.net/edition/news-s ... htm#212079
The chickens are all coming home to roost. The problem with the the housing crisis lays at the feet of the City of Kelowna Planning Department and past City Councillors who have bowed to pressure to stifle the growth of housing in areas outside the urban core except for massive amounts of single family dwellings in the South Mission.
Planners have doled out planning perks with severe restrictions on some areas using the logic that "we are not ready for development in that area". Other areas are given the green light simply because that area is favoured.
To use an example, the Valley Road N- Sexsmith area (south side of Sexsmith ) is inside the city centre core area with the lowest DCC's yet it is excluded from the Permanent Growth Boundary. Meanwhile all the surrounding hilltops either have housing such as Wilden or will soon have housing such as Diamond Mountain (just south of John Hindle Drive)

The Valley Road N- Sexsmith community has bus service running through it servicing Hwy 97, UBCO and beyond. Access is available to downtown and Orchard Park. The Valley Road N - Sexsmith community is within walking distance of both Dr Knox middle School, N Glenmore elementary and the new sports complex at Valley and Cross yet it is excluded from the Permanent Growth Boundary. This area is bisected by 3 major traffic corridors and will continue to see increased traffic into the future.
While the OCP speaks in glowing terms of the need to build higher density along major roads, this area has been excluded from the Permanent Growth Boundary. The OCP speaks to walkable communities and then ignores this area in favour of remote hilltops and developments on the fringes. What is wrong with these people?

[Queen K]

Housing crisis is leading to more and more people simply out of the loop for gaining the first month's rent and last months and then being able to afford to live there

I can't imagine what it takes to decide to "shed squat" and hope no one finds out in the cold of Winter.

https://www.castanet.net/edition/news-s ... htm#218548

Two homeless people were arrested Friday morning for allegedly squatting in a Kelowna shed.

Just after 8 a.m., police responded to the 2200 block of Aberdeen Street after a man noticed the padlock on his large detached shed had been cut off.

The property owner then noticed a man peering out a window from inside.

“RCMP general duty officers responded to the scene and subsequently arrested both a 33-year-old man and a 28-year-old woman, both of no fixed address in Kelowna,” said Cpl. Jesse O’Donaghey.

The pair remain in police custody, but charges have not yet been laid.


Ans where do these people go after the police can only charge them with trespassing? Do we even jail people for trespassing? Right now in minus 4 and the ice isn't even unfrozen on my mud puddles, it's kinder to keep them in jail with food and bathrooms.

Seriously housing and rental availablity is in crisis.

[Queen K]

The tired old "get a job" is going to be rolled out. But there is nothing to say they weren't working. Just needing a place to "be."

And getting a job requires a few things: clean clothes, address and transportation, because guess what the first question usually is, "do you have reliable transportation." Nothing to say they didn't have a car either. I'm going to say, "not likely." But once poverty sets in, it's a vicious cycle. Completely vicious.

[CapitalB]

Kelownas biggest rental problem is from airbnb places bloating up the average prices by renting out monthly in the off seasons at really high prices. They charge extra for being furnished and nice and all the people that own unfurnished possibly less nice places decide that they'll charge %90 as much as the other guys. So now renters have two problems to face; Lack of longterm rental housing because airbnbers just want to rent out in the winter and lack of affordable housing because all the longterm places charge tonnes because the airbnb places set the price precedent.

[Queen K]

That happened to a friend of mine, she was desparate to get a place and took on with the provisio that she had to move by a certain month, for the Airbnb to start up again from June to Sept.

The issue for the people squatting in the shed may be a bit more complicated or not at all, the question is, what is the solution?

If you write on here, "maybe they should move to a more affordable community" the dogpile you is incredible.

If you write, "tell them to get a job," well, I hope I addressed that from the get go.

If you say, "they should be charged to the fullest extent of the law"? Okay, trespassing carries what sentence? A week?

Where can people go exactly, in this community where they aren't kicked out at 7 am?

[Symbonite]

It is time to kick the North American mindset where you are expected to leave the house at around 18. more and more the age of going out of the house is getting higher but the go out and get your own house should be like more like an asian style mindset where you buy a larger house and 3 of you families parents kids uncles live in one place and "invest" into the property and everyone pools in.

im sorry im going to stereo type people but if you look at foreigners from Asia they will have multiple families...and guess who is more ahead after a few years...they are....