Scott McGillivray Blog

Finding Good Tenants

February 9, 2012

The caliber of your space dictates the caliber of your tenant.

One of the keys to being a successful investor is having the right tenants. Rather than depending on luck to get quality tenants, why not ensure you get the best right from the beginning. The biggest mistake that landlords make is taking the reactive approach to dealing with tenants. Being proactive will ensure you’re in the driver’s seat and that things run as smooth as possible. Never discount the fact that there are great tenants out there looking for great places. Typically the better condition your place is in, the easier it will be to rent, tenants will be wiling to pay more, will stay longer and will be less likely to miss a payment because they don’t want to lose a the place.

4 Features that most tenants look for:

  1. Safe
  2. Clean
  3. Modern
  4. New floors

 

Not a difficult to achieve and slightly exceeding it will make your space the cream of the crop.

What has your experience been in finding tenants?

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Flooring Tutorial!

January 16, 2012

I always get questions about the flooring products we use on Income Property and the best flooring options to put into rental suites. In the list of top five things that renters, or buyers for that matter, are always looking for, new floors is always up there. Wood floors are non-allergenic, more hardwearing and much easier to keep clean than carpets – especially if you’ve got tenants coming in and out every year. Here are three options for flooring and the low-down on each:

 

Hardwood:

When we talk about hardwood floors we are referring to a plank that’s been cut from the tree as a solid piece of wood.  The width can vary from 2 ¼” up to 12” and the thickness can be anywhere from 7/16” to ¾”. Hardwood floors are nailed down into place over a wood subfloor. It will react to changes in humidity and needs to be laid with expansion and contraction in mind. Because of how it reacts to moisture, it should only be used in above grade installations, so it’s not the best option for basements. It can be sanded down and refinished a number of times until the nail heads are showing and can come prefinished or unfinished when installed.

 

Engineered Hardwood:

Engineered hardwood starts with a piece of hardwood veneer that is glued onto a number of wood plies in the opposite grain to add strength and stability. You can get engineered hardwood in all sizes and wood types and it looks exactly the same as traditional hardwood but has some additional benefits. It can be installed as a floating floor over existing flooring (including concrete) or be glued or nailed down. Because of the cross-graining effect of the different layers, it won’t react negatively to humidity and have issues with expansion and contraction. It is extremely durable and can still be refinished a number of times. It’s also easier to install and to replace a single plank if necessary.

 

Laminate:

Laminate flooring is a multi-layer synthetic flooring product fused together with lamination process. There is actually a high quality photograph of wood placed under a clear protective layer, over a layer of fibreboard and a melamine bottom. The top layer of laminate is extremely durable and stain-resistant. It is a much more affordable product and can still provide a great look. They are easy to clean and because they aren’t affected by humidity they can be used in basements with excellent results.  Installation is also straightforward as they come with a tongue and groove or “click” system that a homeowner could install him or herself.

 

What are your experiences with flooring? Have any tips to share?

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Doing your homework: Looking at Comps

December 20, 2011

If you’re looking to purchase a home you need to do your research and looking at comparables is an excellent way to gauge a property’s true value. A comparable property is one that is similar in size, condition, neighbourhood and amenities. Reasonable sellers know that their price must reflect the market comps to be competitive. When looking at comparables, you should be looking at three types:

 

* Recently sold comps – How does the property you’re looking at compare in price with ones that recently sold? Is it more or less expensive? Your real estate agent should be able to provide with you the accurate information.

 

* Comps that are currently on the market – If there are a few homes for sale in the area that you are looking in, check out the other properties and see how they actually compare to the one you are considering. Go to their open houses and see if they are truly comparable in terms of size, condition, etc.

 

* Recently on the market but didn’t sell – It may indicate that the house you are considering is overpriced if a similar property was taken off the market because it didn’t sell. And if there are a whole bunch of similar properties in a neighbourhood that are for sale at the same time, the overall prices should be lower. Your real estate agent should be able to provide you with this information.

 

Did looking at the comps help you buy or sell your house?

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Love the Numbers, Not the House

December 12, 2011

Buying a property can be an emotional experience but when you’re buying an income property you should be falling in love with the numbers, not the house. Real estate investing is a business and you need to look at all of the variables closely before you take the plunge to see if it makes financial sense. Profit margin, the ratio of profits earned over your total costs over a certain period, is determined by a number of factors:

 

- purchase of the rental home

- mortgage interest rates

- taxes and insurance costs

- repairs and maintenance

- how much rent you can charge

- vacancy and credit loss

 

Each of these factors is important and savings in any area will contribute positively to your profit margin. If after doing the math you aren’t loving the numbers, you shouldn’t be making the deal.

 

Tell us about your real estate buying experiences!

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Exterior Holiday Lights: the RIGHT way!

December 7, 2011

If you’re thinking about decorating the exterior of your home for the holidays, you’re running out of warmer weekends get it done! So if you’re going to head out there, here are some tips for doing it properly and safely:

 

Using Ladders

- Always have another person with you and have someone hold the bottom of the ladder steady. Watch out for uneven spots or where a leg of the ladder could sink down unexpectedly, like into damp grass.

- Don’t go up on to the roof without wearing a harness. Better safe than sorry

- If you don’t feel comfortable going up the ladder don’t do it! There are lots of options for lighting including stake lights that you stick in the ground and ones you can hang on the inside of the window for a great look!

 

Hanging the Lights

- Be sure you are using exterior lights and exterior rated extension cords! Don’t connect more than 4 strings of lights or consult the box for the manufacturer specs for your product.

- Don’t drill into your mortar joints or bricks. There are clips available that work with the mortar joints so that you can hang heavier objects like wreaths without damaging your brick.

- Don’t staple onto your roof and put holes in your shingles

- There are tons of eaves trough clips available now that you can easily clip your light strings into with no damage to your home.

- Note: If you have water collecting in your eaves your lights can get frozen into them and it makes it very difficult when you want to take down. This is a great reason to clean out your eaves before winter!

 

Save Energy This Winter!

- There are tons of LED holiday lights available on the market now in all different colours, shapes and sizes. If you love the traditional look of incandescent lights, they even make LEDs that look identical.

- LEDs are 80% more efficient than traditional incandescent lighting and last about 25,000 hours – that’s 12 holiday seasons!

- They are also safer to use as they don’t give off any heat

- LEDs are extremely durable and individual bulbs can be replaced

- I also recommend setting a timer for your lights to save energy

- Some big box stores actually do a light exchange where you can bring in your old incandescent lights and they will recycle them and give you a discount on LED strands so be sure to check out your local stores for any deals this holiday season!

 

Do you have any great tips for decorating the exterior of your house? 

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Cold Weather Prep – Get Ready For Winter!

November 15, 2011

For many of us, the cold weather is coming and there are lots of things you can and should do to get your home ready for winter. Taking the time to do a few little fixes can help you save on your energy bills and avoid headaches this winter!

Furnace – If your furnace is 20 years old or more it’s worth the investment to replace it with a high-efficiency model. Fall is also a good time to clean and/or replace your furnace filter. And if you’ve never had your ducts cleaned, you probably should.

Windows & Doors – Fall is a great time to check out the seals on windows and doors. Drafty windows can be sealed up with new caulking and doors with weather stripping. These are easy projects that you can do yourself.

Roof – When was the last time you inspected your roof? An asphalt shingled roof has a lifespan of 12 to 20 years, while a slate roof can last 60 years or more. Look for signs of water damage, sagging or any light shining through and replace any shingles that need it.

Eaves troughs – You should be cleaning them out this twice a year. Clear out any leaves and sticks that will block your eaves and downspouts, which can lead to dangerous ice accumulation. Once clean you can consider installing gutter guards to prevent future blockages.

What do you do to prep your house for winter?

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Behind the Bathroom Walls

November 7, 2011
We get tons of questions on what types of products to use behind the bathroom walls and what we use on Income Property. Here’s a basic run down of how we do a bathroom project:

For shower areas, which means inside the shower/behind the tiles, we generally use a cement board like Durock, a tile backer and then a Schluter waterproofing system.

For damp areas like the bathroom (outside of the shower area), we generally use a greenboard drywall product like DensArmor from Georgia Pacific.

If you’re going to be doing any work, go to the manufacturers’ websites and check out the product information and support sections. Research is the key to knowing which is the best product for your particular area and application.

And don’t forget; when in doubt hire a professional!

Tell us your bathroom reno stories!

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Your Landlord Success Stories!

November 1, 2011

Being a landlord can seem like a daunting task, so we want to hear from you! We want to hear your success stories about being a landlord so we can collaborate and help others who are thinking about taking the plunge. Do you have any tips you can share about being a landlord that you think would help others? Did you have a great experience getting and retaining good tenants? What has made your experience of being a landlord go smoothly?

Share your success story below!

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How To Find Good Trades

October 28, 2011

We get an overwhelming amount of requests for recommendations for trades people, and while I can’t suggest an individual contractor in your area, I always start by doing my research. I’ve provided a checklist below that I use to find good trades:

1. Ask family and friends for recommendations. Word of mouth is often the best and most honest advertising.

2. Phone the trades people on your list, interview each of them and include the following questions:

  • Are they licensed?
  • Do they have insurance?
  • How long have they been in business for and what is there area of expertise?
  • How much money do they require as a down payment for the work?
  • How much time do they expect the project to take?
  • Can they provide you with a number of references and photos of recent projects?
  • Do they guarantee their work?

 

3. Think about the interaction you had with the company or individual during your interview – were they courteous, knowledgeable and forthcoming with information and references? A first impression is a pretty good indicator of your future interactions.

4. Next, follow up on the references provided. Ask about their experiences and if the work met the expectations of the contract.

5. Get bids from a number of different companies and when you’re ready to proceed, be sure to get all of the details in a written contract and review it carefully. Ask questions if you have them.

6. Finally, never pay the full amount until the job is completed and you are satisfied with the work.

The more information you have the better. Good luck with your projects!

Do you have any tips for finding good trades?

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