FEBRUARY 2013 |
www.opp-connect.com WORDS | Alain Kapatashungu
BUSINESS
Canada condos I
Rental Homes Canada creates personalized condo rentals in Quebec and Montreal. In a highly competitive market, partner Alain Kapatashungu asks the big question: should you invest?
t all depends on what you are looking for. Allow me to give you a bit of background information… Condos in Montreal, which are gaining popularity, are proving to be a very good idea for those who are eager to stay in the city center – those who are looking for the jet-set life, a stunning apartment close to downtown attractions and breathtaking views from the new residential high-rises. In the towers of more than 100 condos, indeed, investors both from here and abroad tend to buy numerous apartments in order to rent them out. However, a potential investor must be more careful if this is likely to happen – it’s well-recognized that the level of peace in a building is not the same when many condos are rented. The owners are often unhappy and the value of their condominiums goes down. When the percentage of renters goes up, insurers also consider that the risk is increased. They adjust their premiums accordingly or simply refuse to insure the building.
Can you receive any guarantees that the building you are interested in will not turn into a massive rental building? Not really. The Civil Code states that when there is a sale of a condominium of 10 apartments and more, the proponent must make a note of such information, with the summary of the declaration of condominium which comes with the budget and the names of retained professionals. Certainly, buying in downtown Montreal,
it is expected that there will be people passing through the building. You must accept that the residential component will be weaker.
The documentation provided in the sales offi ce will often give you an idea of what the building will become later on. You can often deduce that the target audiences are the vacation renters and corporate travelers.
I know some folks for whom this way of life fi ts perfectly – and they are super-happy. Many people live alone in these residential towers. They love
“Condos in Montreal are proving to be a very good idea for those who are eager to stay in the city”
to meet new people and this kind of investment enables them to do just that. It is in the borough of Ville-Marie (which includes the city of Montreal) and in Griffi ntown that you will fi nd the largest number of investors. They represent more or less 20% of the owners, says Francis Cortelino, Senior Market Analyst at Canada Mortgage and Housing Corporation (CMHC). This percentage goes down to about 10% in the vast region of Montreal. The percentage of investors has increased somewhat since 2006, but there is no great variation, Cortelino
Alain Kapatashungu, Partner – Corporate Business Development. Born in Burundi, Alain is a French real estate entrepreneur who studied fi nance and management in New York, Paris (France). He began his professional career in 2006 as co-founder and Chief Financial Offi cer in an Internet company special- izing in photo sharing on the web. He launched Rental Homes Canada in 2011. Website:
rentalhomescanda.ca
Email:
alain@rentalhomescanada.ca
said. This overview, however, can hide some individual realities, because some individual projects in specifi c sectors can attract a higher proportion of investors. The quick sales made on their side by speculators, on the other hand, remain a marginal phenomenon.
So, how do I fi nd the market? Operating in a highly competitive real estate market, I had to overcome some obstacles and challenges. My greatest challenge is to be able to showcase a building, and its condominiums within, as being absolutely unique. This can be diffi cult when you are maneuvering within a market where buyers or investors have a wide range of options; either in real estate investment or in extended stays via luxury rental properties. Knowing that, I have to make sure that I always have the right price for the right accommodation or investment. Otherwise, because of the booming market, the client might go elsewhere. In my opinion, being able to give the client choices is critical – but on the other hand, too many choices could tense the market and send the client to invest or lease outside our borders.
This wide range of options has had an immediate consequence: my clients are more demanding. This is fi ne, but sometimes they have focused excessively on the details, which at times caused them to miss a unique opportunity.
I am grateful every day to evolve within this market. You deal with many different aspects as well as real estate. I have been able, thanks to its diversity, to interact and bring to my agency qualifi ed expertise into tourism, real estate (obviously) and develop an unparalleled private concierge service for our clients – which I think is unseen in our fi eld of expertise. Thus, my team and I have gained some beautiful track records despite a highly competitive market.
I have learnt that real estate alone, for an international clientele like mine, wasn’t enough. My team and I are able to fi nd our clients the perfect apartments – either for a real estate investment or an extended stay in Montreal and Canada.
There is a real market with great opportunities for anyone wishing to establish himself or herself or buy a condominium in Montreal or elsewhere in Canada.
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