Small Rental Unit, Small Budget, BIG Impact

A properly furnished space can usually be rented out for more money per square foot than a similar unfurnished dwelling. An improperly furnished space, however, can make your rental unit less appealing and more difficult to rent out. We all know how much of a financial crunch an empty rental unit can cause, especially if we are relying on that rental income to help pay the mortgage. Luckily, it is not that difficult or expensive to furnish a small unit.

Here are 10 easy decorating tips to maximize your investment property ROI.

1. Avoid oversized, overdone furniture. Instead choose smaller pieces that can serve more than one purpose.
2. Properly placing mirrors and mirror finishes will reflect light, add dimension, and help the space to appear larger.
3. Do not use dark paints for the walls and avoid dark furnishings.
4. Open up as much floor space as possible by utilizing hanging shelves and, if budget allows, hanging a flat screen TV on the wall, and equipping the unit with a fold down desk or eating space.
5. Maximize your use of vertical space by hanging shelving over door frames.
6. Avoid flotsam and knick knacks which can be construed as clutter and may not be to your renters taste.
7. Try to make your rental unit as unified as possible. Breaking up your condo into visual sections can make your unit appear smaller.
8. Free up counter space in the kitchen and utilize kitchen specific organizers and storage items. Hooks, cupboard shelves, magnetic spice jars on the refrigerator are all great ideas that are quite inexpensive.
9. Proper lighting can go a long way. If natural lighting is scarce, compensate with plenty of electric lighting.
10. Lightly colored walls and furnishings do not necessarily translate to boring. Try choose bright accents or light wall colors that go outside the beige and cream palettes.

With these ten tips for decorating for small spaces, you should have no problem maximizing the return on your small decorating budget and your small investment property.or more small home decorating tips, visit our source for this article, Globe & Mail, Tricks to Make Small Spaces Seem Bigger

Moving Up? Keep Your Existing Unit as an Investment Opportunity

It is that time again. University and college students are frantically searching for convenient and stylishly small units that they can temporarily call home. This past week we had two colleagues in our office take time off to help their young adult children hunt for apartments near their chosen school. I am sure our office is not the only one to experience a flux in excited parents that are helping prepare their brilliant children for higher education.

So why is this news pertinent to a website that focuses on Canadian mortgage refinancing? This time of year presents the perfect opportunity for those of us who are considering moving up to a larger condo and keeping our smaller units as a real estate investment property, especially if the existing property is close to or easily accessible to a university or college. Due to the high amount of student renters, the transition from dweller to landlord can be almost seamless.

Bachelors and one bedroom condo units represent a great opportunity to earn a rental income. Many investment property owners believe that we can get the most “bang for our buck” with smaller units because they can inexpensively be “fixed up” with some new flooring and a fresh coat of paint. When compared to larger units, it can also be much less expensive to furnish a bachelor or one bedroom.

Tiny budgets can make a big impact when working with a small space, as long as your budget is spent carefully on items that are sure to attract tenants. To learn more about making a big impact with a small unit and budget make sure to read tomorrow’s post Small Rental Unit, Small Budget, BIG Impact.

Real Estate and Mortgage Comparison Made Easy? Not by Stats . . .

Real estate and mortgage comparison can be a tricky proposition - especially between markets and over time. Statistics do not necessarily make an objective analysis easy. Yesterday's housing sales and price numbers released by the Toronto Real Estate Board (TREB) are a case in point. When comparing markets over time, or between geographic markets, the same numbers can tell two very different stories.

"Prices remained stable throughout the GTA in July," according to the latest sales numbers from the TREB. "At $371,427 the average price increased slightly more than one per cent from $366,012 recorded in July 2007 and nine per cent from the $342,034 figure of two years ago." So is the market relatively flat with a very modest 1% year-over-year gain over last year's record setting levels, or is it relatively healthy with an annualized 4.5% annual growth rate over the past two years?

The housing sales stats released yesterday by the TREB show a number of such often-contradictory indicators:

• In the City of Toronto, the average house price increased less than one per cent from July 2007, a record-setting month, but was up10 per cent from July 2006.

• In the 905 Region there was a 3% price increase from July 2007 and an 8% increase from July 2006.

• Overall sales declined 12 per cent from July 2007 record of 8,912 but increased 10 per cent from 2006.

The interpretation of such disparate statistics - what they mean, and what the driving forces behind the numbers are - is, of course, left up to the analyst doing the spin. The National Post's analysis is that the numbers for Toronto reflect the effect of the introduction of a new municipal land-transfer tax that encouraged buyers into the market before it took effect, and what we are seeing reflects the first-time buyers who would otherwise have postponed their purchases. Contrarian doom-saying political analyst and M.P., Garth Turner chastises the federal government and continues to predict that a 12% drop in sales levels from record-setting numbers a year ago is his long-heralded beginning of a U.S. -style housing meltdown.

Perhaps the best real estate and mortgage comparison analysis came from Canadian Real Estate Association president, Calvin Lindberg, in his comments last month on June's national real estate sales numbers. "In essence" says the CREA president, "Canada's housing market has pulled back from the record-setting pace set in 2007, but in most provinces it continues at or near sales levels set in the years before that. The increase in housing prices is also pulling back from the record-setting pace of last year, but we have yet to see any of the price contractions that have impacted the housing market in the United States."

If anything, the interpretation of the TREB's most recent sales numbers shows that real estate and mortgage comparison between markets and over time is a dubious and subjective interpretation. Purchasers are best served by doing the the research in their market at the time they are considering buying, and making decisions based on a long-term investment strategy, rather than speculating on the shorter term movement of markets.

Price First Mortgages and Avoid 'Bidding Wars' when Buying First Home

When pricing out first mortgages and looking at the homes those mortgages will be able to finance in the Toronto real estate market, first time buyers should not be fooled by house listings that are strategically under-valued - an all-too-common practice according to a recent article in the Toronto Star.

"Listing properties below the market value has become a common practice in the Toronto area over the past five years – creating a bidding-war mentality for buyers," according to the Star. "Even with sales down, the market cooling dramatically and active listings up by 22 per cent compared with last year, multiple offers continue in some highly sought-after areas."

"While houses sit on the market longer with more inventory available in the Greater Toronto Area, most of the multiple offers are taking place in pockets of the central city still coveted by buyers," reports the Toronto Star's Tony Wong. "But under-listing properties has created a backlash, not just among frustrated consumers, but also from some agents who say the practice is undermining the profession."

A recommended strategy that will save the time - and expense - of getting into opportunistic bidding wars triggered by the strategic undervaluation of a property for listing purposes is to first consult a mortgage broker to determine from a range of lenders the precise mortgage amount that fits your budget and with which you will be comfortable. With your bottom line firmly established, a reputable and well-resourced mortgage broker will likely be able to point you in the direction of a realtor who is savvy to both the market and to the market-ploys of real estate agents who seek to falsely inflate a home's value through an under-valued listing designed to promote a bidding contest.

Market research is perhaps the key when entering the real estate market for the first time. Researching the terms and rates for first mortgages from a wide number of lenders (with or without the help of an experienced and well-resourced mortgage broker), and working with an experienced realtor can help you avoid falling into common traps that can all too easily snare the first time home buyer - including getting caught up in the frenzy of a falsely-induced bidding war to get that "must-have" apartment or condo that other, less-wary buyers are feverishly bidding up the price on.