Monthly Archives: August 2015

Selective Discrimination

Renting-property

After spending 20+ years working in the Real Estate Industry, we’ve seen enough to shock even the hardiest individuals. I’ve always found it extremely frustrating to see constant stigma and open hostility and discrimination if someone was a property owner/landlord. Discriminating against someone based on their “source of income” is a clear violation of the Canadian Human Rights Act. However, the clear and open hostility, from government officials, police, Media, The Residential Tenancies Branch, and the general public would never be accepted if it was directed at any other minority group! If fact, we see examples of the media addressing issues of racial discrimination on a daily basis in either newspaper or TV.  Yet, for some unfathomable reason, society feels it’s acceptable to take a stand against the mean, nasty, greedy property owner. For one and one reason only – their “source of income”. This is a clear violation of Human Rights Act! Yet no media have EVER (that I have seen) raised the issue of how unjustified this discrimination is.

Last time I checked, statistics said that approximately 50% of all rental units in the city were owned by small “Mom and Pop” operators. These numbers may have changed, with all the new building in the last year or so. However, these are the people that work hard at a regular job, scrape together the savings for a down payment on an investment property, in the hopes that it will give them a better return on their savings than a bank interest rate that is often less than the rate of inflation! They are your neighbors, your co-workers, your family and your friends. They are generally good honest people who work hard just like you do. Yet, the outright hatred and open hostility they face is so overwhelming, that many become frustrated and sell off their property to eliminate the stress of the discrimination.

One recent seller told me that after a tenant literally shot up the suite with a gun; walls, ceiling, everything has to be replaced. No way to collect the damages from the tenant. It’s the owner’s responsibility to track the tenant down and attempt to impose a Queen’s Bench garnishment order on their bank account or place of employment in order to collect the damages. They can close their bank account or leave it inactive. They can quit and work somewhere else, if you can’t track them down, you don’t collect. 

On the flip side, our Provincial Government openly discriminates against the landlords solely because of their source of income. If a landlord owes a tenant money, the RTB can redirect the rent from that house to pay the judgement to the tenant, if the landlord doesn’t pay. If that isn’t enough, they can order rent re-directed from ANY other property you own to pay that settlement. So, they do the work of collecting for the benefit of the tenant, but the landlord is left taking time off work to continually chase down a tenant that keeps changing jobs, and banks. The only difference between the two groups is the source of income. 

The misguided and WRONG attitude by our illustrious Government and Media is that Landlords are all rich, savvy, with lawyers and employees and lots of time on their hands to have someone else look after chasing down tenants who refuse to pay their debts. The REALITY is they are hardworking people with full time regular jobs they cannot afford to take time off from because they are left with $20,000 repair bill! Where is the fairness? Where is the justice? If you, as the Government, are going to collect for one group of people (tenants), how can you LEGALLY discriminate against the other group (Landlords)?! If you can re-direct a landlord’s income to pay a tenant, why can you not redirect a tenants’ income to pay the Landlords what they are owed?! There is something seriously wrong with this system. 

Yes, there was a well-known Property Management Company that was recently disciplined by the Manitoba Securities Commission. The individuals responsible have been held accountable and are no longer in a position where they can cause further issues. However, the overall public and media attitude has become that much more hostile towards Landlords and Property Management Companies as a whole as a result. Why are we judging the group by the actions of one or two? Why do we allow people to get away with this type of generalized hatred? When it comes to discrimination based on race, color, sexual preference, etc…, open discrimination like this would be front page news and people would be protesting in front of the Legislature. Yet it seems discrimination by source of income, painting all Landlords with the brush of a few bad apples, is acceptable and commonplace and everyone turns a blind or critical eye. 

For the record, we used to own a number of rental properties and a property management company. I’ve seen and experienced this discrimination first hand and it is extremely stressful and so full of hate – just because we owned/managed rental property. We rarely collected from tenants when the RTB issued a judgement. When we finally sold our last property we were left with approximately $50,000 – $60,000 in unpaid judgements and considerably more for those that never made it to a hearing as they disappeared before you could ever serve them paperwork. Just before I retired I had an experience that would stay with me for the rest of my life. I was filing paperwork at the RTB offices downtown. There was a middle aged ethnic couple there with a RTB officer and they were crying. They couldn’t get a tenant out of their house and the RTB wouldn’t explain the correct procedure to them. “It’s all online – it’s all on the paperwork”. They obviously did not speak English well and no one would help them. I spoke to them and found out the tenant had been there for more than 6 months without paying rent. Utilities were being unpaid and they could no longer pay for the mortgage on the rental house and their own house. They were being ordered by the RTB to pay the utilities on the rental property. They had tried 3 times to evict the tenant, but they didn’t serve the paperwork in the right order, or the right form, etc. They had filed and had a number of hearings but because their paperwork was “not in order” the tenant was allowed to stay rent free, and they were told they had to refile and start again and wait for a new hearing. They were behind on their home mortgage and were at risk of losing both homes if they couldn’t get this sorted out. They both worked full time and couldn’t continue to take time off work, they needed the income. They were recent immigrants and had put all their savings into the 2 homes. I spent some time with them and the worker, showed them what they had to do and in what order. They were very grateful and I can only hope things turned out well for them. I couldn’t understand why our Government can offer language interpretations services to tenants in multiple languages but will not make any effort for the Landlord. That day I returned to my car and cried. It was so unfair and there was nothing I could do to change it. The hatred and stigma and unfairness of it all was more than what I was prepared to continue living with. That day I decided I wanted out of the business and began selling off every last property. I’ve never been happier!

We saw everything. A client was thinking of purchasing a property and requested we go have a look at it. We walked in with the realtor to find water pooling through the kitchen, living room and to the front door. There were 2 young boys, maybe 6 – 8 years old. They were sitting on the sofa playing video games and the electrical cord and video box was on the floor and was centimeters from water pooling around it. I had rubber soled shoes and ran to the electrical outlet and unplugged everything seconds before the water surrounded the electronics. The kitchen faucet was left running, dishes and empty alcohol bottles were overflowing. The children hadn’t eaten, mom was passed out on a mattress with a baby maybe 6 months old crying beside her. The milk in the baby’s bottle was curdled and chunky. We called social services and police. Another image I will always remember. We’ve seen piles of human feces in homes where the water was turned off for non-payment. It’s hard to get rid of that image!

We’ve seen suites where there have been murders; suicides and attempted murders and attempted suicides. People just angry and frustrated with life and think it’s Ok to take out their frustrations on other people’s property. The amount of damage we have seen over the years is well into the millions of dollars. This never reaches the news. The odd time someone hears about it they think “rich property owner can afford it”. Really?! Then why do we hear about it when someone goes on a vandalism streak and smashes car windows in a neighborhood?! Why doesn’t the same attitude apply? You’re a “rich car owner” after all… The number of people who contact me selling their rental properties, always with the same horror stories and frustration is insane. This is such a black eye on Manitoba. It’s time someone took notice and began working for change!

Years ago, after evicting a tenant for not paying the rent, he called our home and threatened my 6 year old daughter in the most foul language, and told her he was coming to kill us all. I grabbed the phone away and blocked his number instantly and called police. There was nothing they could do because “it was a Landlord/Tenant issue” call the RTB. The RTB doesn’t deal with issues like that – they told me to call the police! Unbelievable! He threatened my 6 year old child! No one gave a damn cause I was a Landlord! Didn’t matter, but someone can be sitting taking pictures in a park and everyone hears about it for fear they “might” be a child molester. My daughter was terrified and traumatized and I couldn’t do a thing except change our telephone number and set the alarm! Why? Because we were “landlords”! Just so very sadly wrong in every aspect. Just wrong!

The reality is that right is right and wrong is wrong. It is not right to destroy another person’s property, regardless of the circumstances. It is not alright to utter threats or assault others. It is not okay to discriminate against anyone, based on ANY of the categories under the Human Rights Act. It’s not okay to fight for someone’s rights while you openly stomp on another’s. Everyone deserves to be treated fairly and equally based on who they are and what they have or have not done. Putting people into “groups” and judging them based on their belonging to this “group” is inappropriate and unfair and unjust. I’ve always been fair and dealt with people as individuals. I just wish our Provincial Government and our Media could do the same and stop championing some groups while slaying others. Discrimination happens in many ways – it is never right or acceptable! People are not all of the same character, regardless of the “group” we “belong” to.

Highly Competitive Fall Market

Homes-sold-home-for-sale-report

Back in the spring I wrote a blog about my concerns with the number of new builds and potential over saturation of the market. Well, it seems the National and Local Media have recently come to the same conclusion and the repercussions are being seen almost instantly! Basic rules of supply and demand are in effect. The more supply, the more fussy buyers can become. As the supply continues to grow, we have seen a correlating increase to the number days on the market it takes a home to sell.

There are a number of factors that can dictate when the fall market picks up. Weather is the biggest factor, but this year it seems once the media released its observation that the market is over saturated in Winnipeg, everyone suddenly wants to get their home on the market “now”. Sellers who have been waiting for the market to peak so they can get the best dollar for their homes are suddenly rushing to get their homes listed. Others who have been slowly getting their homes ready for months, are suddenly in a panic to get the house listed ASAP. The number of calls and booked stage jobs in the last week is more than 5X what we saw last year at this time! We’re scrambling! Sellers and Realtors are all looking for an edge to get their homes sold!

I have had a number of sellers ask me what we’ve observed of the market. It all depends on where the property is located and what the price range is. Homes in the lower price ranges in the well-established, mature neighborhoods are still selling relatively quickly. Usually in anywhere from 2-5 weeks. Rural and higher priced homes can take longer; anywhere from 2-4 months is common. Homes that have been updated and look good, sell faster than those that are outdated. Homes that are in serious need of updates will sell quickly as investments, if they are at the right low price. Yes, believe it or not, we have still seen bidding wars on staged and updated properties. Not nearly as many as in past years but we have still had a number of homes sell in bidding wars.

Homes that tend to sit longer are those that are in rural areas, which typically are in lower demand due to the additional travel to the city. I personally do not understand this. I grew up in West St. Paul. It is 20 minutes to Portage and Main. I now live about half way between Winnipeg and Lockport and still it takes me 30 minutes to get to the south end (using the perimeter) and only 20-25 minutes to get to Portage and Main. Our property taxes are 25 – 33% of what you pay in the city and we have 2-3 times the lot size. We played baseball in our back yard and still had tonnes of room for a pool and multiples decks! It’s quiet and peaceful and my grocery store is only 5 minutes away! Driving home every day – getting out of the city, is a wonderful feeling as we leave the stress of the city behind and head out to the “country”! 

Homes in the newer developments also tend to sit longer. Many are priced higher so that rules out a big section of buyers. That is normal is any market! Higher priced homes just take longer to sell as there are fewer qualified buyers. Buyers expect more from a home in that price range and they can afford to be very selective. There are quite a few “knock down” and “build new” in well-established neighborhoods like Tuxedo or River Heights. Money isn’t so much as issue as the area itself and the detail that goes into the new home. These buyers are not interested in a new development. They prefer the new completely custom build in the old neighborhood!

Many new builds in developments were built as an investment and can take longer to sell. Unfortunately, walking through some of these homes (not all but enough to take notice), it’s obvious these homes were built on the quantity and not quality principle.  Drywall seems are cracking, flooring is shrinking leaving large visible gaps, stucco is falling off a home not even a year old, windows are leaking inside because they weren’t installed properly. It’s really pretty sad. When buyers walk through and see this, it scares them off not only that house but potentially the neighborhood. They are paying top dollar for a brand new home that they can see has issues. Their Realtor will point these things out to them and then they start to think, what else is wrong that I can’t see….? There’s just no way buyers will pay top dollar for that kind of shoddy workmanship! I cannot count the number of repairs KAT Reno has been called in to do repairs on New Builds! Our home may be older, but the drywall seams and the stucco are as solid as the day they were put on! No surprises for us!

I have been shocked at the number of out of town investors that have built new homes here to take advantage of the housing boom. I didn’t realize that many out of town investors were building here. Ironically, not one was actually moving here, and they were all coordinating the building process from out of town. I’ve worked with many investors over the last 20 years and some will do what needs to be done and what is right, others will always cut corners to save money. There is simply no way you can stay on top of the building process and ensure the quality of the work being done from afar! How can you possibly stay on top of a complete new build from another province? When we do major renovation work for clients, we request they are available every few days if not daily to review the work and respond to questions. That just can’t happen with an out of town investor. Add a Builder who may be a little lax on his quality and knows there’s no one inspecting…. Let’s just hope if you are purchasing, you know who you are buying from!  Will they stand behind their Build?  Only time will tell…

Tire Kickers Vs. Genuine Clients

dining room 

We’ve all been there. Someone calls and is in a panic to get something done NOW! As soon as possible, it’s urgent. We do our best to accommodate, without taking time away from already scheduled clients. You meet with the individual, go over all the details. They are in full agreement, have you book a time and date. Then, between the time they book and when they are to issue a deposit they change their minds. In some cases, they don’t even have the courtesy to let you know until you start to chase them to find out what is going on. It is very frustrating.

It’s so difficult to distinguish the “tire kickers” from the serious clients who are just busy and can’t get to it right now. Often clients misjudge how long it will take to get everything completed before we can stage. They genuinely want to proceed, but need more time to get things done. This is not unusual. De-cluttering is a big job and often takes longer than anticipated.

The biggest frustration are the ones who demand you drop everything and come out today or tomorrow. I always give an estimate over the phone based on the size of the space and how many rooms are to be staged. If they are comfortable with the estimate, than I set up a meeting to provide a firm quote. I explain terms and conditions and explain our booking procedures. 

It’s really quite simple. I provide our next available date for staging. I ensure we allow time to source, pull, and pack the necessary stock. Depending on the job, this may require a few hours to a few days if we need to source items outside our warehouse or shop for specific items. Then we require a deposit at the time of booking, before we will commence any work. This protects our time against the “tire kickers” who absolutely “want” to stage, insist you book them in and then change their mind the day before. We’ve had a few times over the years where we’ve trusted people, only to have them change their mind after we’ve pulled all the stock and packed everything. Interestingly, these are also the ones who refuse to pay anything for your time. Very dishonest people. Then I’ve had clients who decide to take an offer, they cancel but are more than happy to pay for the time we’ve spent on planning/packing their job. I just LOVE these clients. They are the reason I trust people! Unfortunately, not all people are like this. 

Without a deposit, all the time spent planning/packing is wasted and I’ve just paid my employees hours and hours for absolutely nothing!!! It didn’t take long for me to change that policy! If you are serious, you will give me a deposit to reserve the time and to pay for the time required for designing, pulling stock and packing. If you sell or decide not to stage after the work has been completed, you will be billed for the time and work that have been put in. Sorry we simply do not work for free. We are running a business and have to cover the cost of the time involved in planning and preparing a job.

If you receive an estimate today with a booking date next week when we are available, please do not take a week to decide and then expect it staged the very next day. When I give a booking date for staging, that allows us time before that date, once we have approval and a deposit, to get everything, designed, planned, sourced and packed. If you do not give me the go ahead until the day before, you’ve just lost a week! Keep in mind, you are not our only client and our only estimate. I always tell people, that date is available right now, but we have multiple estimates out and clients who are in the process of getting their homes ready. The first one to confirm a booking with a deposit is the one who will receive the time slot. I simply cannot reserve time slots for people in the “hope” that they will be ready and will decide to go ahead. Basically if someone is serious, they have no problem confirming a date and issuing a deposit to reserve the date. I understand delays happen, and if someone needs to push us back a few days or week, that can often work in our advantage and we can use the time to plan another job. I rarely bill someone for a reschedule, but if we have costs involved that incur losses, those are billed back to the client. 

We try very hard to accommodate our clients and meet their deadlines. However, just as we respect our clients time and meet their deadlines, we request mutual respect from our clients. Please do not treat us like we “owe” you something for nothing. I do not know you and I owe you nothing. If you choose to hire us, we do a great job, are friendly and accommodating, however, we do require a deposit upon booking and the balance of the payment the day of staging. I’ve never had someone unhappy with our design on a job. So Tire kickers, who want to waste people’s time can go kick someone else’s tires. I have some pretty awesome clients waiting for my time.