Toronto Income Property Newsletter: March 2008
Hello everyone. I’m pleased to announce that my new booklet entitled “Live for Free, to be free to live” is finally here. This book is a very handy guide for anyone looking to purchase a duplex, triplex or multiplex in the G.T.A., and is especially beneficial for live-in investors and first-time buyers. I have taken all the key pointers and observations that I have learned from my years of experience in the field and neatly summed them up in this simple and easy-to-read publication. After months of rewrites, typeface and layout changes the first several hundred copies came off the presses in February. I am happy to report that the initial responses have been very encouraging.
For those of you that have known me for the past few years, the “Live for Free” concept isn’t new. I wrote my first version (a whopping fourteen pages) back in 1999 before I had even obtained my real estate license. I was shocked to find at that time that with all the myriad of books on real estate investing, there were very few that talked about living in income properties and how best to buy and maintain them. There was also very little written specifically about the Toronto income property market, which is indeed a unique animal all unto its own. Surprisingly, all these years later there still isn’t a definitive duplex or triplex strategy book so I’m hoping that my effort will fill that void.
This version is the first full-on upgrade that I have done in years with many new sections, a glossary and an investment bibliography. All in all it’s sixty seven pages, with particular emphasis on tips and strategies to maximize your chances for success. I resisted the temptation to pad the book in order to give it more volume with stuff that isn’t really relevant to a discussion of residential income properties. There are also many other Canadian investment books that do a better job of explaining cap rates or how to buy a strip mall, so I’ll leave that discussion to them. I know duplexes and triplexes, with pretty much all the ingredients that go into buying and selling them, so that is what I have tried to completely cover for my audience in this booklet.
“Live for Free” is currently available for sale through the Plex website (www.plex.ca). For the first time, I have decided to charge a small amount just to help recoup some of my upfront production costs. You can purchase the physical guide itself for $14.95 plus $2.00 shipping and handling. You can also get a link to download the book digitally as a PDF file for only $9.95. Just click through to the format that you desire and you will be taken to PayPal where you can easily pay by credit card. I don’t intend to make a profit from this book but there is a cost to printing and mailing them out so that is why I have applied these very nominal charges.
I am also working on a new webpage dedicated specifically to the book to be ultimately found at www.liveforfree.ca. I think that there are a lot of people out there, not just in the Toronto vicinity, but potentially all around the world that can benefit from the information I am providing. That is why we are starting to work on a book webpage separate from our real estate company website. I’d love to hear your thoughts and comments and love it even more if you could help me spread the word and even assist me in generating a few extra on-line sales.
O.K. – enough shameless promotion. Now on to a few topical issues: The new Toronto Land transfer tax went into effect at the beginning of February. Many of you have been asking about what the early read is on its impact. I can definitely say that (from my perspective) February was a slower than average month and sales were less than the same time in 2007. However, the weather has been terrible and it has been very cold. I think that this is more so the reason that the sales numbers may seem a little sluggish. I just got back from Florida to get away from our winter and I’m sure that I’m not the only agent that did the same thing. When the weather is really bad, none of us relish getting out there to trip through properties. As I stated in my past newsletters, I think that this extra upfront fee will be absorbed by both buyer and seller and it ought not to have a huge impact on our market.
TREB’s statistics of housing sales have shown an interesting trend since City Council’s approval of a Toronto land transfer tax last October. When City Council approved the Toronto land transfer tax, it also decided to exempt home purchases made by December 31, 2007. In both December and November of last year, there was a significant increase in market activity. For example, although the month of December typically sees less market activity because of the holidays, in December 2007 housing sales in Toronto were up by 26 per cent over December 2006, significantly higher than the 6 per cent increase for the GTA as a whole. Obviously, when the final numbers come in for February we will be able to get a more complete picture as to this tax’s real effect on the market.
The final numbers for 2007 came out a few weeks ago. Take a look at the chart below and notice how 2007 had higher sales volumes than other year in the past twenty. For all the market analysts who have been predicting a downturn in the market, it’s hard to expect these sales numbers to continue to spike up indefinitely.
I believe that the huge glut of condo sales have helped produce these past few record-breaking years. Once they slow down (and they will!) then we’ll start to see the volumes subside a little. Since income properties represent less than 10% of the total inventory (and I think it’s even less), I don’t feel that they really impact sales volumes that directly. My golden rule still stands: a quality income property in a great part of town that doesn’t need a lot of upkeep will always be desirable since these properties fuel themselves.
That’s it for this month. Go to the Plex site and grab a copy of “Live for Free” and tell all your friends about it. I always appreciate all the help and kind words. See you next time.