# Looking for Property Manager for my new condo in Montreal



## chautm (Jul 4, 2016)

Hi everyone,

I am looking for a property manager for my 2 bedrooms condo built in 2015 in Montreal. 
I would really appreciate if someone can provide me some experienced property managers in Montreal and their services information (service fees, their responsibilities, etc.)

Thanks


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## Quotealex (Aug 1, 2010)

Where in Montréal is the condo located?


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## chautm (Jul 4, 2016)

Quotealex said:


> Where in Montréal is the condo located?


Mercier-Hochelaga.

Thank you


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## Just a Guy (Mar 27, 2012)

You probably won't find many that are interested in managing a single unit. There's a lot of overhead that doesn't make it worthwhile. Then you need to consider the conflict in bad times...one renter, two units. Your single unit, another person who owns several, which do you want to keep happy?

When you're small, you usually have to self manage places.


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## Quotealex (Aug 1, 2010)

Just a Guy is right. As a favor to a friend living another country, I manage a few of his condo units in the "sud-ouest" district of Montreal since he was having a hard time finding a management firm at an affordable rate. I believe most firms was were asking something like 10% of the monthly rent plus one month rent for each new leases as well as 15% for any repairs work done....


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## chautm (Jul 4, 2016)

:frown:
Thank you so much.


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## chautm (Jul 4, 2016)

Hi

I will relocate for a job in another city within Canada and may be back in Montreal after 1-2 years. During this period, I can only occasionally visit Montreal. I don't want to sell the condo neither. I don't know what to do if I can't find out property management firm. Any advises, suggestion in my case?

I am looking at this website RAGQ (a rental furnished apartment/condo website ): anyone has used this service before?

Thanks


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## canabiz (Apr 4, 2009)

Do you have any family member or friends in Montreal who can *manage* the property while you are away? I use the word *manage* here pretty loosely as your condo is new and it should be fairly low maintenance.

The hardest part is to find quality tenants. You can either do that yourself or find a property management firm or a realtor who can do that for you. I don't know the rate in Quebec but it is typically the first month rent here in Ontario, or more specifically, Ottawa where I am located.


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## Mukhang pera (Feb 26, 2016)

I agree with JAG that you should expect to self-manage a single unit. But, even with you living in another city, if should not be all that difficult.

As cannabiz suggests, maintenance should be a minor issue with a new condo. As well, it's a condo, not a house, and there are not all the building envelope and grounds issues to think about. But even then, it's not all that daunting.

I own a duplex in California. I have lived in Canada and other parts of the world while managing it on my own for nigh on 20 years. Not a big deal. The few changes of tenancies have not even required me to hire someone to find a new tenant. Each time, I have recruited the outgoing tenant(s) to find a new tenant. I am sure that will have some CMF readers rolling their eyes. It has worked very well. I have never had a problem tenant. In fact, the last time I had a change of tenancy, the outgoing tenant took photos of the place and posted them on a rental website. Then he screened tenants for me and sent me emails advising about each showing and interview. He ran credit checks. Finally, after a week or so, he sent me an email listing all of the applicants and ranking them in order of choice, as he saw it. He gave reasons for each ranking. I went with his #1 pick and it worked very well. That was years ago and #1 pick is still there. I paid him something for his time, which he deducted from his last month's rent, but it was much much less than the equivalent of a month's rent.

As for maintenance, while I lived there I got to know a few maintenance types...plumbers, electricians, etc. So, if a tenant contacted me saying there was a maintenance problem, I would give the tenant the contact details for the appropriate repair person and let him schedule an appointment. My maintenance guy would then contact me to report on what, if anything, required work and at what cost. I could give approval, they could then schedule with the tenant, I would pay on my credit card and the receipt would be emailed to me so I would have it in my file for tax time. 

Also, as cannabiz suggests, if you have any friends/family in the area, that can provide some backup. I have that backup in California, but I have never needed to call on it.


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## humble_pie (Jun 7, 2009)

Mukhang pera said:


> I own a duplex in California. I have lived in Canada and other parts of the world while managing it on my own for nigh on 20 years. Not a big deal ...
> 
> 
> As for maintenance, while I lived there I got to know a few maintenance types...plumbers, electricians, etc. So, if a tenant contacted me saying there was a maintenance problem, I would give the tenant the contact details for the appropriate repair person and let him schedule an appointment. My maintenance guy would then contact me to report on what, if anything, required work and at what cost. I could give approval, they could then schedule with the tenant, I would pay on my credit card and the receipt would be emailed to me so I would have it in my file for tax time.




this went on for 20 years? plumbers & electricians would compose chatty little notes about their proposals for repair & then they would e-mail these billets-doux to you for your approval?

mukhang we all know you are a legendary figure of irresistible & romantic proportions. But for the life of me i can't figure out how you get repair persons to do this. Me i can barely get them to come to the house. The ones who are reliable & competent are totally inundated with business these days.

once they arrive at the house, they want to get to work PDQ, not spend any time rhapsodizing in e-mails. Then there's the question of whether they can write at all, in any media. Usually i'm given hand-scribbled work orders that are beyond dyslexic. In a broken mixture of english & french.


.


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## My Own Advisor (Sep 24, 2012)

Maybe interview a few folks from list here?
https://www.yelp.ca/search?cflt=propertymgmt&find_loc=Montréal,+QC


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## Mukhang pera (Feb 26, 2016)

HP, to read your words, I suppose I must recognize that I have been fortunate indeed. 

I have really had very little - perhaps zero - difficulty in getting things done quickly competently and at reasonable prices. On a number of larger items contractors have come out, given an estimate and, in some cases, set out options. As to the latter, one example relates to the sewer line from the house to the city connection under the sidewalk. The lot is large and has a lot of mature growth on it. Some in the form if sizeable trees and the roots like to get into the sewer line. The tenants know when it is happening because drains start to slow down. A couple of times the tenants called Roto Rooter and had the line Roto-Rooted. That fix is cheap, but only good for about 2 years. So then I had another contractor go in who came back with one plan that would cost about $20k. The tenant called Roto and asked about options. This is what he emailed me (this was in 2004):

I finally got all three quotes from RotoRooter.
The supervisor in charge was off on a job site for 4 weeks and not returning messages...I got the owner involved and we finally got the numbers.

1) Spot repair the damage under the house and spot repair the main break in front yard - $5800
2) Spot repair under the house and replace the line in front yard - $8900
3) Replace everything, front to back $19080

I would definitely recommend option 2. I fear if you went with option 1, we would just have more front yard problems within a year or two as that's where all of the trees are (whose roots cause all of the damage). When looking through the video camera, I could see other areas in the front yard that are starting to have problems, and option 1 would not replace them. Option 3 seems too expensive, and feels like overkill. There don't seem to be any trees interfering with the line in the backyard, so it seems much less likely to have problems.

I can fax any/all of these proposals to you if you'd like. Just let me know the fax #.
****
Here's another email from the same tenant, in 2005:

I received the quote from the painter. To be honest, I'm not sure I trust
it. It seems very very low to me - it also seems very low to the window guy,
to Carla, and to some of the interior decorators Carla works with.
Basically, everyone who's counsel we've sought on the matter. That said,
here are his numbers:

Windows only $3870
Downstairs interior $2930
Exterior stucco $2250

I obviously hate to look a gift horse in the mouth, but if you consider that
3 years ago, Carla got two bids for the interior downstairs, one for $5000
and one for $6000, I'm not so sure about these guys.

I would like to get another bid or two, and want to try to figure out if we
can really trust these lowballers or not. If we can, that's obviously great,
but I'm just not sure.

In the meantime, do you want me to go ahead and get started on the window
order? It will probably take about 2 months to build the darn things, so we
have plenty of time to finalize the painter situation. If so, I'll find out
payment plans, etc. You want to charge via credit card, right?

****
These are but a couple examples of how, with the help of tenants (and the right tenants will help...it's in their best interests) things can be managed quite nicely from afar.


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## Just a Guy (Mar 27, 2012)

humble_pie said:


> But for the life of me i can't figure out how you get repair persons to do this. Me i can barely get them to come to the house. The ones who are reliable & competent are totally inundated with business these days.


Humble,

You need to establish relationships with these people. When you own a number of properties you get some pull...steady employment outweighs a single contract with a lot of these guys. It also helps that I represent several boards and work with several property managers, so I do represent a lot of work.

The other part is helping develop some of these guys when they are starting out, hooking them up with larger contracts, helping them get their foot in the door as it were.

It's very tough when you only call on people once or twice ever year or two. As I said in the other thread, real estate takes long term planning to really succeed.


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## humble_pie (Jun 7, 2009)

^^


but all the chatty e-malls are coming to you from your tenant, not from the actual contractors or tradespersons themselves, no?

speaking of the tenant, he sounds more like a brother or a cousin or a son-in-law ... at the very least a co-owner of the property ...

but as i say, you yourself are special & magic. No other landlord in cmf forum ever posts about how his tenants are recruiting & interviewing plumbers, sewer repairmen, house painters & potential replacement tenants. I suppose when the contractors start the actual work, the tenants then good-naturedly serve as project manager as well?

mukhang is it possible that you've invented the equivalent of the driverless car? the ultimate managerless real estate investment property. could this be a book in the making?


.


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## humble_pie (Jun 7, 2009)

.

i have some friends who invest in small commercial strip properties. They go for long-term leases which they describe as net-net-net. Apparently the tenants - all businesses - pay for their own repairs, renovations & utilities as well as all property taxes.

i imagine that, in effect, what my friends are doing is bankrolling the mortgage. I imagine that their rents would be less, given the burdens being assumed by the tenants. But at least they rarely hear from their tenants.


.


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## Just a Guy (Mar 27, 2012)

Humble, perhaps commercial real estate is exactly what you need with their triple net leases. The rents aren't significantly lower, the work involved is significantly less as the tenants are responsible for everything, but of course the risks are significantly higher. In a downturn, the property may remain vacant for years, if not decades at a time.


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## Mukhang pera (Feb 26, 2016)

humble_pie said:


> ^^
> 
> but all the chatty e-malls are coming to you from your tenant, not from the actual contractors or tradespersons themselves, no?
> 
> ...


True, HP, the chatty e-mails come from the tenants. Over the years I have had the same type of relationship with more than one tenant of the place. But hey, at least the chatty e-mails are not coming from me, like the old song...gonna' sit right down and write myself a letter...".

As I said, there has never been any difficulty in getting tradespeople to come out and to get written proposals, forwarded by the tenants, whose views I always welcome. On occasion I have found it expedient to call or email a contractor directly to ask a question, negotiate or such, but I have found the process very smooth. That is probably unusual, especially over such a span of time. But that is why I am encouraging the OP to consider self-managing his rental condo. He might have an equally easy time. He might become a couch potato landlord, a role I have perfected.

And yes, to some extent tenants have acted as project managers. I have cultivated them to feel like "a brother or a cousin or a son-in-law ... at the very least a co-owner of the property". It is their home. Helping me to get maintenance and repairs done cost-effectively and efficiently serves us both. So far, all my tenants have seen it that way. It has made it a bit of a driverless car. And, as I said in another thread, in all of this, in close to 20 years, there has never been a vacancy of either suite for even one month. The only vacancy at all was when, some time ago, I prorated the rent for the tenants' last month, to allow them to vacate a few days early and not pay for the full month, which suited their moving plans, and I used those days to have the place painted as I had promised to the new tenant. So, that time I had a vacancy of about 3 or 4 days. 

Another point is this. I charge somewhat less than market rent. I did not buy the property as an investment and, from the outset, no doubt improvidently, I have never seen a need to wring every last dime out of it. If it brings in a bit of income, that's nice, but that was not the driving force behind the purchase. It's the kind of "investment" that JAG would admonish as making no sense. It's in an expensive city. Take Vancouver. The last place I owned there is now worth about $3 million. How much rent would you have to get for it to be a good ROI? A lot more than the market will bear, I am sure. That house was an ordinary 4 BR, 2,700 square foot house on a 33-foot lot. I cannot imagine it renting for more than maybe $6,000 a month. In fact, I recently went online and found a nicer place a few blocks away (probably worth more like $3.5 million) asking about that much for rent. After property tax, maintenance, etc., a rather meagre return.

My CA house would maybe fetch USD2 million today. The rent is $7k/mo. On 2 mil, that's a rather slim return. Happily, I am too unsophisticated to see just how bad it is. To rationalize the whole debacle, this is what I do. I recall that when I bought it for less than USD600k, I put down CAD300k. From that starting point, I perform my head-in-the-sand analysis. So now, the rent is $7,000. The mortgage payment is $1,700, of which $1,100 is principal. I am actually foolish enuff to regard the principal repayment as an aspect of positive cash flow! How delusional is that? Taxes are about $800/mo. and insurance another $200. So my monthly bills are about $2,700. I budget $1,000/mo. for maintenance and repair. Over the years I have had some big bills, but some years the bills are small and I doubt I have paid anything like $240,000 in total over 20 years. It would, however, be well over $100k. I could go back through my tax and other records and determine the amount exactly, but I am content for the purposes of this post to simply say that repairs/maintenance have been $1k/mo.

So, according to my fool's analysis, I receive every month $7,000, minus fixed expenses of $2,700 = $4,300, minus $1,000 for maintenance/repair, for a net pre-tax income of $3,300 U.S./mo. on an investment of CAD300,000, without counting principal repayment as having any value. At current exchange rates, that $3,300 U.S. is about $4,100 in northern pesos. So, in my fool's paradise, my ROI is CAD49,200/yr., or better than 16%, on an "investment" of CAD300,000. So please, don't tell me to grow up and realize that my "investment" is about CAD2.5 million and my return is a paltry 2%. THAT dose of reality might lead to a major depressive disorder that all the king's horses, all the king's men and all the fluoxetine on the planet cannot reverse.

I am happy in my ignorance. Were it otherwise, to be a real investor, worthy of the name, I would have to sell what I have and take what what might turn out to be $2 million net and buy perhaps a couple of houses in Windsor, Ontario, maybe a couple more in Pouce Coupe, B.C. and one or 2 in The Pas, Manitoba. Would they be filled with happy, chatty tenants who would invite me to stay when in town? Probably not.


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## Berubeland (Sep 6, 2009)

Humble Pie, I too want to find these magical tenants as do most of my clients, many of whom I am helping out of horrible situations. 

Currently I am helping an owner, he assumed the tenant from a previous owner, he's going on 9 months rent due, his previous manager quit because she didn't know how to handle Landlord & Tenant Board matters, the tenant has appealed his eviction to the higher courts. His wife works full time as a nurse, he's a contractor, he came and served me the Appeal papers in his Mercedes. 

Then I had the one tenant who cut the grass, that was a good deal before he punched the other basement tenant in the face and I had to evict him, then I had to evict her because she didn't pay rent. That owner was in Denmark when this went on. 

I do have a ton of excellent tenants, they pay the rent in full and on time, leave the place broom clean when they leave, but I think it's a complete lack of competence and responsibility on the behalf of the landlord to get the tenants to quote work and evaluate contractors. This is just asking for disaster and trouble. 

Being a landlord is work, no one is giving you free money. You have a job to do to take care of the property, either yourself or your property manager or real estate agent or whatever. The tenant's primary responsibility is paying rent and in Ontario, you the landlord are responsible for snow removal and lawn maintenance and property maintenance. 

I have said before that you should be close to your rentals so you can oversee and step in if necessary and even at 10% of a month's income, there's no property manager that can afford to do the very serious work now being required to legalize your house and apartment and make it comply with Fire regulations and city bylaw. Bad tenants will report you and sue at the LTB at a drop of the hat and there goes your lovely dreams of carefree money. (Again) 

I have said this before and I'll say it again, your pm makes say $60-$200 per month. This includes paperwork, rent collection, tenant interaction, tenant turnover work, some quoting of contractors etc. Property managers have to be careful about the people they hire to do your work, they need to hire licensed, insured, WSIB compliant companies. These companies cost more because they have to pay taxes etc. Property managers cannot stand next to a painter and say brush right, brush left. We hand the guy the key and go inspect the job when they are done. These are the realities. 

When I started in this business many landlords did the work themselves and were tradesmen. They added value to the property and did a very decent kind of business. Tenants understood that if they paid $700 for a basement apartment, it might not be legal and if they called the city and the fire department, they would be evicted. Now tenants are shocked that their actions and their reporting to these different agencies has consequences for them. 

I've been shocked by the increase in two working tenants who don't pay their rent, because they know they can get away with it. It's completely ridiculous and I'm actually considering starting a collection agency just to deal with these bad debts and brand their credit reports. 

So for those who have read Just a Guy and Mukhang Pera's post, I think they come from another dimension. Just A Guy is still finding all these great income properties and I think Mukhang has had the same tenants for 10 years and even though his house is 2 units, he rents the whole house out as one unit and it's under rented by $1000 per month, by his own admission. 

My 2 cents.


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## Berubeland (Sep 6, 2009)

Commercial property rents are higher than residential. Commercial evictions for non payment are easy breezy compared to the crap we have to put up with in the residential world. 

But you need a bankroll. When you have a vacancy you will have to clean and repair that space to bare walls. It might stay empty for a good while. 

I manage a strip plaza, and it is quite easy to get the rents.


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## Just a Guy (Mar 27, 2012)

I suppose when you work in an job, you get tunnel vision. Employees, who only see a small part of the business, or industry, often think they are experts...GTA or Vancouver doesn't have cheap rentals...must mean the entire world is the same to some.

Of course, the middle managers often think they know everything, and that they could run the company themselves...no clue as to what the CEO may know about the greater picture.

People who work in a larger world, at a higher level, often do things that others can't fathom. International banking for example, is completely different than what most of us are aware of. they make money doing things that seem rediculous to others...trading currencies, billions at a time on margin, playing fractional changes...

Canada is a big place, different provinces have different rules and opportunities, none of them are the same. When some provinces boom, others bust. Some seem to have better tenants than others. Some provinces are very tenant friendly, others aren't. Then there are those who invest internationally...say places like Phoenix, Las Vegas, etc. All of which have made tremendous returns for people who bought in at the right time.

I've had a tenant do major work at their own expense, it's not common, but not impossible. I've had lots of good tenants, I've had my share of bad ones too. The longest I've had to battle was about a month and a half after serving an eviction to regain my property. I've had places trashed, but not often. Most of my places are usually a quick day or two of fix/cleaning. 

So far, I've managed to avoid the real nightmare tenants, probably due to my experience and a bit of luck. There is always luck in business and life, some of it good, some of it bad. 

Of course, if you go into a situation with a negative bias, instead of looking for opportunities, I'm sure you'll manage to prove yourself right. If you don't find what you want at home, you have to look elsewhere.

Where I live strip malls are all but abandoned, or torn down for redevelopment...of course, I don't believe that applies to every place in the world, but I certainly wouldn't want to own one near where I live. Also, I'm sure calgary's commercial real estate is probably turning into a bit of a nightmare to the investors right now...two years ago, it was probably a cash cow. You need to know the area you're investing in, and know the macro trends as well, look for crisis as it usually spurs opportunities. For example, Calgary may be a good commercial opportunity in the next few years, if oils doesn't recover too soon. Combination of overpriced market, broken leases, bankruptcies...Get in near the bottom, when people are hurting and ride the wave to the top...

It's not a nice way to make money if you think about it, you're making money on other's suffering or mistakes, but then "ethical investing" hasn't really performed well over the years.

I'm sure "experts" out there will continue to deny there are opportunities out there, but that's fine. The world needs employees to work for people who make money.

Personally, I can't understand how she remains in business if all her clients are losing money hand over fist, with no way of ever being able to make money in such a terrible industry...

However, I know a lot of people who jump into real estate thinking it's an easy way to make money...it's not, it's work.


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## humble_pie (Jun 7, 2009)

.

guys the mere thought of owning a rental property gives me life-threatening allergies. What if i had a tenant who would lose his job or something worse would happen? right away i couldn't accept any rent money ... sob ... i'm one who supports shelters for at-risk youth & other homeless ...

but still, i adore reading the landlord chronicles of berubeland, just a guy & mukhang pera. All three have vastly different approaches but it's obvious that all three do an excellent job, render a fine service to their tenants, provide quality housing, support civic life in general & enhance the communities where their properties are located.

in addition, berubeland & mukhang are entertaining & fun, while just a guy is probably the decent-responsible-fair-minded-landlord of every tenant's utmost dream.

thankx for all the posts, guys.


.


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## Berubeland (Sep 6, 2009)

Just a Guy, 

Life is too short to even respond to your idiotic comment. 

Once again to reiterate earlier comments going back a long time to warn the unwary. I don't believe Just a Guy has any properties at all, never mind the magical ones he owns. 

I actually wish I was an employee, I'd get more time off and a better boss.


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## peterk (May 16, 2010)

Mukhang pera said:


> My CA house would maybe fetch USD2 million today. The rent is $7k/mo.


Ah, there it is... Perhaps the emails from Mukhang's tenant is actually from the tenant's paid personal assistant? :biggrin:

I would consider myself to be about as good a tenant as could be, certainly willing to be accommodating of any number of situations as they crop up with patience and understanding (like the city half burning down and not being able to get a new fridge delivered to your apartment for 2 months). I'd of course be willing to put in an hour of work here and there if it means an easier life for my landlords and everyone involved.

But major home repairs on a house, interviewing, selecting and overseeing contractors, making $20k decisions on type and scope of repairs? Ha! That is ludicrous. I don't know if I'd ever do that unless I was being properly compensated in some way or it was my relative's house and he had a good reason for not doing it himself...

Perhaps people at the $7k/month rent level are of a different stock though. Maybe they have assistants that do the work, or stay at home spouses that want what they want exactly? Who knows, sounds too good to be true.


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## Just a Guy (Mar 27, 2012)

Don't know about mukhang, but in my case the tenant was a professional contractor, he lived in my place for a long time. I never raised the rent in all the years he was there. He decided he wanted to make changes, asked if it was okay, and did it. Wasn't anywhere near $7k/month in rent.

Have had other tenants who've made improvements, built a fence so they could have a dog, that sort of thing...I paid for the supplies, they applied for the permits and did the work. Again, not high rent, but they wanted a dog. Again, I didn't raise their rents over their years of staying.

Good relationships do work.

Funny how people are willing to lie to themselves. As a business owner, I at least know that I routinely have to go for new job interviews (more than anyone who actually has a job in fact), and that I'm an employee. It's called getting new clients and working for them. Maybe some people generate money out of thin air though...they don't actually work for someone else...of course, they also don't understand the definition of "won't respond" either, so what can you expect.

Of course we do agree on one thing, she definitely has a terrible boss. Some suffer from the "small dog syndrome", when they encounter something they can't handle, they go on the attack...lots of barking, not much thinking. Fairly common trait in property managers I've met.

I'll admit, it's a very tough job. Not very rewarding as your successes usually involved getting rid of a terrible tenant after a big battle...I understand how they become jaded, and always assume the worst. 

Toughest part of real estate is keeping the emotions out of it.


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## kcowan (Jul 1, 2010)

Mukhang pera said:


> for a net pre-tax income of $3,300 U.S./mo. on an investment of CAD300,000, without counting principal repayment as having any value.


How does it look after tax?


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## Mukhang pera (Feb 26, 2016)

Berubeland said:


> So for those who have read Just a Guy and Mukhang Pera's post, I think they come from another dimension. Just A Guy is still finding all these great income properties and I think Mukhang has had the same tenants for 10 years and even though his house is 2 units, he rents the whole house out as one unit and it's under rented by $1000 per month, by his own admission.


Fair comment Berubeland. I do think I come from another dimension, certainly as for as being a landlord goes. And yes, my house is rented at well below market, which I freely admit.




peterk said:


> Ah, there it is... Perhaps the emails from Mukhang's tenant is actually from the tenant's paid personal assistant? :biggrin:


Actually, with the one tenant who now rents the whole house, partly for his office, I do hear from his assistant more often than he.




Just a Guy said:


> I've had a tenant do major work at their own expense, it's not common, but not impossible.


My current long-term tenant has always taken care of minor repair/maintenance issues without even mentioning same to me. Partly in recognition of discounted rent.

I'll make one further admission which, had it turned out badly, I would never admit to having made such an egregious error of judgment. However, things went well, so I'll tell the story.

My current tenant is in a business that I know little about, but it's a big industry in that town. He is part of what might broadly be described as the entertainment industry. It seems to be feat or famine. In the year or so before 2013, he called me once in awhile to ask if he could pay rent late. I agreed. Then he would ask if he could underpay and make it up later. Again I agreed. By late 2012 he owed just shy of $30k. I told myself that if it reached $30k, I would take action. I was spared because he caught up in January 2013. But then the pattern started again. I kept a record, of course, which I updated and forwarded to the tenant from time to time. It reads thus:

Payments 2013 

Jan. 3,360
Jan. 25,175 rent current
Feb. 3,360
Mar. 6,360
Apr. 10,000
May 0
Jun. 6,660
Jul. 6,660
Aug. 3,330
Sep. 3,330
Oct. 0
Nov. 6,360
Dec. 3,330

Total rent for 2013: $79,020
Total paid 2013: $57,750
Balance owing: $21,270

2014

Jan. 0
Feb. 0
Mar. 1,600
April 2,000
May 2,177
June 1,500 + $382 paid direct to LA Housing
July 1,700
August 3,300
Sept. 3,200
Oct. 4,000
Nov. 9,000 
Dec. 8,000

Total rent for 2014: $6,660 x 12 = $79,920
Total paid 2014: $36,859
Balance owing: $43,061
Add balance from 2013: $21,270
Total owing as at Dec.31/14 $64,331

2015


Jan. $8,000 as per Anna’s Jan. 23 email.
Feb. 8,000
Mar. 8,000
April 8,000
May 8,000
June  8,000
July 8,900
Aug. 8,000
Sept. 28,000
Oct. 6,730
Nov. 6,730
Dec. 6,730

2016

Jan. 6,730
Feb. 7,860
2013 & 2014 arrears = $64,331, reduced in Jan./15 by $8,000 - $6,660 = $1,340 to $62,991; reduced in Feb./15 to $61,651; reduced Mar./15 to $60,311; reduced April/15 by $8,000 - $6,860 (new rent amount) = $1,140, therefore $60,311 - $1,140 = $59,171; reduced May/15 by $8,000 - $6,860 = $1,140, therefore $59,171 - $1,140 = $58,031; reduced June/15 by $8,000 - $6,860 = $1,140, therefore $58,031 - $1,140 = $56,891; reduced July/15 by $8,900 - $6,860 = $2,040, therefore $56,891 - $2,040 = $54,851; reduced Aug./15 by $8,000 - $6,860 = $1,140, therefore $54,851 - $1,140 = $53,711; reduced Sept./15 by $28,000 - $6,860 = $21,140, therefore $53,711 - $21,140 = $32,571.
From the arrears of $32,571 owed after receipt of the Sept. 2015 payment we must deduct (as agreed) $8,183 for expenses incurred (I am awaiting a few receipts from Anna) + $20,000 paid when I was there. Therefore the arrears then became $32,571 - $28,183 = $4,388. After September 2015, rent of $6,730 per month was paid for Oct., Nov., Dec. and January, with actual rent being $6,860 per month, so an underpayment of $130 per month x 4 = $520, so I would calculate current arrears at $4,388 + $520 = $4,908. 

Feb./16 payment of $7,860 ($1,000 extra) reduced arrears to $3,908.
Mar./16 payment of $7,860 ($1,000 extra) reduced arrears to $2,908.
Apr./16 payment of $7,860 ($1,000 extra) reduced arrears to $1,908.
May/16 payment of $8,768 reduced arrears to 0.

I told almost no one about the mounting arrears, even the first time they got up to about $30k. I was not really upset about it because the tenant overall paid enough to cover the mortgage, taxes, etc. If I had been called upon the subsidize the bills, I might not have let things slide as i did.

I knew what I would hear and the one or 2 friends to whom I mentioned the arrears situation. Of course, that gave the same advice. I was told the situation was hopeless, would only get worse and in the end the tenant would be gone and I'd never see any of the arrears. I was told to waste no time in kicking him out. However, I felt I knew the guy and that he would somehow keep his word. And he did. This was the guy who, in the good times, would call me to say he was going to be away from home quite a bit in the next few months, so he was having his assistant deposit 3 months rent in advance. And she would.

The tenant is of that elusive sort to which JAG made reference:




Just a Guy said:


> I've had a tenant do major work at their own expense, it's not common, but not impossible.


When I lived in the house, it had a roof deck over the garage that had fallen into disrepair before I bought. When I left, I dismantled the whole works and took out the rickety staircase up to the deck. The whole thing was an occupiers liability problem waiting to happen. This is what was left when I was done:



Some time after my current tenant took over the whole house, he asked permission to restore the roof deck at his own cost, undertaking that it would be done professionally and with proper permits, which he arranged in my name as owner. The result looks like this (with some photo editing to protect the innocent and perhaps not-so-innocent):






I do not have a pic, but he also replaced the crappy aluminum garage doors with high quality wooden ones.

I cannot attach more pics to this post, so I'll continue in another.


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## Mukhang pera (Feb 26, 2016)

Story continued:


When I lived there, the grounds were high maintenance, with lots of grass to cut, etc. When I started renting, I paid to have a gardener attend every 2 weeks. My tenant asked permission to landscape at his cost. The net result was more attractive grounds and no more need for a gardener. My tenant and his wife do the little that is required. A few pics:


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## Mukhang pera (Feb 26, 2016)

Just a Guy said:


> Toughest part of real estate is keeping the emotions out of it.


Oh dear, forgive me, for I have failed. My one and only rental property was once my own home and it was carefully selected to be such. All the tenants I have had have, in a sense, been residents of my home, not just a rental property. I think they have felt that and my relationship with all has been not strictly landlord/tenant, but friends, partners, associates, etc. All the things landlords are told to avoid. 

There's emotion attached for me because it was my home and, in the early days, I kept it so I would have it to return to. There is now little chance of that, but I am still attached to the place. I like it. I like owning it. I am proud of it. I have an orange tree in the backyard as shown in one photo. I love my orange tree because I cannot have one here in B.C.! Knowing that property there, even 1,300 miles away, I find uplifting. Hard to explain. Not really logical and certainly unbusinesslike. I go there about once a year on average and I am welcomed into the place to which both my tenant and I have an attachment. All very unconventional. But it has overall worked very well for me. I know of no one else similarly situated. It is a situation sui generis.



kcowan said:


> How does it look after tax?


All I can offer on that score is that it could look better. That is mainly because I am still working and also I have pension income. That I can split with my wife, but all else accrues to me and is taxed at a fairly high marginal rate. The rental house I owned before getting married in 2003 and it is in my name alone, as is the income. I have never really looked into it, but I reckon it would trigger significant tax and other costs were I to transfer a title interest to her, so that she could report a share of the income and pay tax at her marginal rate. Then, like me, she would have also to file both U.S. and Canadian returns. 

I have mentioned this on the forum before, my quandary about whether to keep the place for my wife's long-term benefit or whether to sell out and do something else. Right now, I wish she was the only person on title and the only recipient of the income. Leaving aside issues of attribution rules, etc., if she could be the sole recipient and sole payer of tax on the income, we'd be much better off.


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## Just a Guy (Mar 27, 2012)

Yeah, that's one of the reasons I'd never rent a former home of mine. I'd hate to see it trashed by a bad tenant. 

You've been lucky with your tenant. Personally I don't want to count on luck, so I try to minimize things that could possibly upset me. 

Better to sell, keep the memories good, and buy places specifically for rentals. Besides, homes rarely make good income properties. You can buy multiple properties and lower your risk for the same equity.


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## humble_pie (Jun 7, 2009)

Mukhang pera said:


> I am still attached to the place. I like it. I like owning it. I am proud of it. I have an orange tree in the backyard as shown in one photo. I love my orange tree ...
> 
> The rental house I owned before getting married in 2003 and it is in my name alone, as is the income. I have never really looked into it, but I reckon it would trigger significant tax and other costs were I to transfer a title interest to her, so that she could report a share of the income and pay tax at her marginal rate. Then, like me, she would have also to file both U.S. and Canadian returns.
> 
> I have mentioned this on the forum before, my quandary about whether to keep the place for my wife's long-term benefit or whether to sell out and do something else. Right now, I wish she was the only person on title and the only recipient of the income. Leaving aside issues of attribution rules, etc., if she could be the sole recipient and sole payer of tax on the income, we'd be much better off.




first, you do have the best trees! me i slightly prefer those ancient pale pink douglas firs on the BC island property, but the california orange tree sure is a sweet-looking arboreal treat.

next, it's true you did tell us about the cali property & how you'd like to put it in your wife's name.

i'm assuming that, even if you conveyed its ownership into a corporation in which madame could hold shares, there would be a deemed capital gain disposition of the asset at the time of the conveyancing?

alas, market value at time of conversion to rental property --> $2M present day value in USD = taxable capital gain of possibly something like $1 million USD (notice the cost base is value as of the date you ceased using the house as principal residence & commenced the rental business instead.)

a similar problem presents in some stock portfolios. Older holdings dating back 2 or 3 decades can have high paper capital gains today. The happy difference is that, in a stock portfolio, an investor can take small gradual steps every single year to raise his cost base, so that the eventual gains on disposition will be less. Such an investor needs to start this discipline a good number of years before dying, of course.

unfortunately, with a real estate property this gradual flotation of the cost base - a bit like raising a ship through a series of canal locks - does not seem possible.

still, though, you will most likely have to do something about that valuable california property some day. Otherwise your heirs will face the tax problem ...

PS would you be facing a possible US estate tax problem with the california property? keep in mind that the $5 million USD threshhold is for US resident taxpayers ... alien non-resident estates get a pro-rated proportion of that $5M based on the ratio of US assets in the total estate of the deceased ... this leads me on to the idea of a trust.

many canadians hold US real estate in a trust in order to escape estate taxation. Is it possible that a trust to benefit a minor child could help in some fashion? trust deeds often contain articles directing that income & even capital can be paid out to the parent or guardian of a minor beneficiary ...


.


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## Mukhang pera (Feb 26, 2016)

humble_pie said:


> first, you do have the best trees! me i slightly prefer those ancient pale pink douglas firs on the BC island property, but the california orange tree sure is a sweet-looking arboreal treat.
> 
> still, though, you will most likely have to do something about that valuable california property some day. Otherwise your heirs will face the tax problem ...
> 
> ...


Thanks HP. The place does have some nice growth around it, but i too prefer the forest here.

The tax issues you have touched upon have kind of kept me immobilized. I have not delved into it too far, always procrastinating, but one reason for the procrastination is this concern that just about any kind of move will trigger undesirable tax consequences. And maybe it's like a chess game...make a move and you cannot unmake it. An appropriate expert might have some ideas to lessen the blow. 

Your idea of a trust to benefit a minor child just might be worth a look.


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## humble_pie (Jun 7, 2009)

Mukhang pera said:


> The tax issues you have touched upon have kind of kept me immobilized. I have not delved into it too far, always procrastinating, but one reason for the procrastination is this concern that just about any kind of move will trigger undesirable tax consequences.



so common, i do the same thing myself. Although not even owning any stately or fruit-bearing trees to sweeten the blow.

but it is what it is. A difficult problem waiting for a solution.

.


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## kcowan (Jul 1, 2010)

and I believe that, without a trust, taxes have to be paid by the surviving spouse.


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