tag:blogger.com,1999:blog-31427364.post306533432358711958..comments2024-03-26T03:52:23.395-07:00Comments on Housing Analysis: Owner’s Equivalent Rentmohicanhttp://www.blogger.com/profile/06094213357140749289noreply@blogger.comBlogger10125tag:blogger.com,1999:blog-31427364.post-24557454331869095432010-03-06T10:25:31.983-08:002010-03-06T10:25:31.983-08:00This rent is to justify value of property only......This rent is to justify value of property only....<br /><a href="http://www.ownerwiz.com" rel="nofollow">Homes For Rent</a>LC Davidhttps://www.blogger.com/profile/14661553559911270375noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-83838973817269568832009-03-21T20:47:00.000-07:002009-03-21T20:47:00.000-07:00I have to admit this is by far my favorite blog. ...I have to admit this is by far my favorite blog. Thanks!buff_butlerhttps://www.blogger.com/profile/13312280863888753900noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-79208897220536911032009-03-20T01:16:00.000-07:002009-03-20T01:16:00.000-07:00Congratulations! This series is thought provoking ...Congratulations! This series is thought provoking and adds value. This is an improvement over people- bashing which doesn't add economic value, though bashing can be gratifying at times.<BR/><BR/>That said, I would advise against analysis paralysis. This is a fuzzy world. Be market-focused. Markets are dynamic. Can you capture the nature of that dynamism? You're got to pound the pavement and talk to people.JimTanhttps://www.blogger.com/profile/13480972517925246528noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-47069673031174488682009-03-19T08:29:00.000-07:002009-03-19T08:29:00.000-07:00"i wonder if given two similar condos, one owner-o...<I>"i wonder if given two similar condos, one owner-occupied, and one being rented out (i.e. investor owned), which the majority would choose."</I><BR/><BR/>Rents must cover the cost of wear and tear and other forms of depreciation. If a landlord decides to use the income from rents for other purposes and not properly provision for depreciation or perform adequate maintenance, this is nothing more than a cash advance.<BR/><BR/>Agree with patriotz it's the same market. It may seem different but I would be very hesitant to gloss over the fact there are perceived differences between market segments, seemingly manifested through the owner-occupier versus investor ratio, when the two are very similar when all costs are accounted for.jessehttps://www.blogger.com/profile/02155122147972263497noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-23086150704857192512009-03-19T00:06:00.000-07:002009-03-19T00:06:00.000-07:00Clearly an owner-occupier would prefer a non-tenan...Clearly an owner-occupier would prefer a non-tenanted property given the same condition and the same price. Getting rid of a sitting tenant incurs cost and risk. But that does not mean a segregation into two different markets, just a price adjustment.<BR/><BR/>But an investor always has the option of incenting a tenant to leave prior to marketing the property. Also of course, a great many investor owned properties are vacant anyway. Just look at the MLS. Such a property would usually be preferred by an owner-occupier over one which is currently occupied by the seller.patriotzhttps://www.blogger.com/profile/11154064267408955762noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-83167395462850975172009-03-18T23:38:00.000-07:002009-03-18T23:38:00.000-07:00Which is patently incorrect. All properties are so...<I>Which is patently incorrect. All properties are sold on the same market. A buyer does not care whether the seller is an owner-occupier or an investor, nor does a seller care about the buyer.</I><BR/><BR/>i wonder if given two similar condos, one owner-occupied, and one being rented out (i.e. investor owned), which the majority would choose.yaahttps://www.blogger.com/profile/09176358178528499599noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-11805000312290918202009-03-18T22:23:00.000-07:002009-03-18T22:23:00.000-07:00I think the argument is that there are effectively...<I>I think the argument is that there are effectively two markets, the investment market and the non-investment market</I><BR/><BR/>Which is patently incorrect. All properties are sold on the same market. A buyer does not care whether the seller is an owner-occupier or an investor, nor does a seller care about the buyer.patriotzhttps://www.blogger.com/profile/11154064267408955762noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-85967722786895225232009-03-18T15:44:00.000-07:002009-03-18T15:44:00.000-07:00On a side note, I was recently given this link fro...On a side note, I was recently given this link from CMHC about the effect different ways to count home ownership cost might affect CPI.<BR/><BR/>http://www.statcan.gc.ca/pub/62f0014m/62f0014m2003016-eng.pdfAlanhttps://www.blogger.com/profile/00449919969036824198noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-63642976044719007102009-03-18T10:28:00.000-07:002009-03-18T10:28:00.000-07:00"Since investment properties turn over more quickl...<I>"Since investment properties turn over more quickly than owner-occupied ones their impact on pricing is more than one would infer from their % of properties owned."</I><BR/><BR/>I think the argument is that there are effectively two markets, the investment market and the non-investment market and in some classes of dwellings the non-investment class dominates. <BR/><BR/>I agree that investors will set general price levels in the aggregate statistics and for markets in which they produce a significant fraction of transactions (such as condos). That doesn't help solve how to value properties in higher end "non-investment" neighbourhoods. We are left trying to infer rent that is a function of purchase price! Unless we can reference to something more tangible...jessehttps://www.blogger.com/profile/02155122147972263497noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-41870430887626265602009-03-18T08:03:00.000-07:002009-03-18T08:03:00.000-07:00One huge flaw in Somerville's argument regarding t...One huge flaw in Somerville's argument regarding the signifance of the % of properties owned by investors is that pricing is determined at the margin. In other words, it's not the % of properties owned that's significant but the % of buyers and sellers. Since investment properties turn over more quickly than owner-occupied ones their impact on pricing is more than one would infer from their % of properties owned.<BR/><BR/>Indeed I would argue that for condos in particular investors are the prime movers of the market. Owner-occupiers are incidental.patriotzhttps://www.blogger.com/profile/11154064267408955762noreply@blogger.com