Vol. 11 No. 1 March 2018
Canadaâ€™s #1 most widely read publication for Apartment Owners, Managers and Association Executives
The official publication of:
THE TAXMAN COMETH A Rental Executives National Think Tank conversation: Looking at the numbers
Real estate tech trends: Innovation through automation Technology is transforming the multifamily industry. Marketing and process automation are both empowering staff to be more efficient.
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These guidelines are creating a greater disparity of rents within buildings. Arun Pathakâ€“ p. 15
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Editor’s notes Back from March break I’m writing this after surviving March break (both my wife and daughter were off for the week). We had a great time visiting the Strong Museum of Play in Rochester with friends (I highly recommend it, as it is so much fun for both kids and adults). However, my daughter and I came down with horrible colds, which kept us indoors the rest of the week. Trying to entertain a sick 7 year old for several days will tax your patience and creativity. This issue of RHB Magazine features a RENTT panel with members of various apartment associations across Canada. Our panelists have different perspectives than rental property owners, and it was interesting to hear how issues differ across the country. They discussed topics related to rent, including changes in rent control guidelines, increasing rent in provinces where there are no rent controls, property taxes and building assessments. We take a look at real estate tech trends, which looks at how marketing automation and process automation can help to make multifamily rental property firms more efficient and effective in running their businesses. We also discuss how to communicate more effectively with your elevator service provider to get the most out of your service contract, get better service and reduce costs. Make a note on your calendar – the CFAA-Rental Housing Conference takes place on May 14 – 16 in Vancouver, British Columbia. For more information, see pages 38 – 41, or visit www.CFAA-RHC.ca. Remember to read through CFAA’s newsletter, National Outlook, as well as the Regional Association Voice. And be sure to check out “Spin Cycle” before you you’re done reading (it’s a good one). As usual, we enjoy hearing from our readers and support two-way communication. If you have any comments or questions, send them to firstname.lastname@example.org. I look forward to hearing from you.
Enjoy the issue! David Gargaro Senior Editor
4 | march 2018
Juan Malvestitti email@example.com
Marc Côte firstname.lastname@example.org
David Gargaro email@example.com
John Dickie, President CFAA firstname.lastname@example.org
Director of National Sales Nishant Rai
Regional Sales Executive (RAV) Ranjna Bhardwaj
Office Manager Geeta Lokhram
One year $49.99 Cdn Two years $79.99 Cdn Single copy sales $9.99 Cdn Opinions expressed in articles are those of the authors and do not necessarily reflect the views and opinions of the CFAA Board or management. CFAA and RHB Inc. Accept no liability for information contained herein. All rights reserved. Contents may not be reproduced without the written permission from the publisher. P.O. Box 6967, Maple, ON L6A 1S7 416-236-7473 Produced in Canada All contents copyright © RHB Inc. Canadian Publications Mail Product Sales Agreement No. 42652516
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VOL.11 NO.1 2018
contents Knowledge is POWER “It’s not what you know: it’s who you know.” When it comes to keeping your elevators running, it’s vital to know both.
Looking at the rent numbers The Rental Executives National Think Tank panel comes together to discuss issues related to rent, rent control guidelines and more.
Regional Association Voice Regional Association Voice features the latest industry news from four member associations.
Tech trends: Innovation through automation The unprecedented rate at which technology is developing and advancing today will further transform the multifamily industry.
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Spin Cycle Spin Cycle goes into the psychology behind typography, and what it means to your business.
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presidentâ€™s corner with John Dickie, Dickie & Lyman LLP As compared with the proposals first made in July 2017, the current government plan for corporate tax reform is an improvement. The changes only apply to Canadian-controlled private corporations (CCPCs), not to public companies, REITs or people who hold title in their own names. The changes will also not impact investors whose corporations earn only rental investment income, rather than active business income. According to the latest plan, income splitting through CCPCs will still be limited, but some exceptions are being put forward, most notably for business owners age 65 or older to split income with their spouses. As well, earning passive investment income in a CCPC may limit access to the small business tax rate otherwise available for active business income. That passive income change will affect real estate companies which employ more than five fullâ€“time employees, and are thus able to treat rental income as active business income. Companies with $150,000 or more of investment income will lose their access to the small business tax rate. However, they will not have to pay a super-tax of up to 73%, nor have to track second generation (and third generation) investment income, as was proposed in July. See page 35 for more details. As noted at page 38, Budget 2018 includes several other positive measures in relation to housing. Those measures include an increase in funding for the Rental Construction Financing Initiative, which is open to for-profit developers. As this goes to print, the federal legislation to make marijuana consumption (and limited growing) no longer a crime is still before the Senate. Provinces are taking a whole variety of positons with respect to consumption or growing cannabis in rental units. On another note, registrations for CFAA Rental Housing Conference 2018 are rolling in. The
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conference will take place on May 14, 15 and 16 in Vancouver, British Columbia. The Building Innovations Tour will take place in the afternoon of Monday, May 14. That will be followed by the Welcome Reception. The education sessions will take place over May 15 and 16. The CFAA Rental Housing Awards will be presented at the Awards Dinner on May 15. All net proceeds of CFAA-Rental Housing Conferences go to support CFAAâ€™s national lobbying efforts on behalf of the rental housing industry! For more information, see page 38-41 or visit www.CFAARHC.ca. Register now to join your colleagues at CFAA-RHC 2018!
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In this issue of... National Outlook Page 35 – The government has backed down on two of its proposed corporate income tax changes. However, it is still going ahead with limits on income splitting, and limiting the access to the small business tax rate for businesses with passive income of more than $50,000 per year. Grandfathering is currently off the table.
Page 38 – CFAA’s Rental Housing Awards winners will be announced at the CFAA Awards Dinner on Tuesday, May 15. The deadline for applications is April 9!
Page 40 – CFAA Rental Housing Conference 2018 will take place in Vancouver from May 14 to 16. Many speakers will address topics of interest to landlords of all sizes in BC and across Canada. Learn more and register today!
To subscribe to CFAA’s e-Newsletter, please send your email address to firstname.lastname@example.org.
The Canadian Federation of Apartment Associations represents the owners and managers of close to one million residential rental suites in Canada, through 11 apartment associations and direct landlord memberships across Canada. CFAA is the sole national organization representing the interests of Canada’s $480 billion rental housing industry. For more information about CFAA itself, see www.cfaa-fcapi.org or telephone 613-235-0101.
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CFAA Member Associations Eastern Ontario Landlord Organization (EOLO) www.eolo.ca P: 613-235-9792 Federation of Rental-housing Providers of Ontario (FRPO) www.frpo.org P: 416-385-1100, 1-877-688-1960 Greater Toronto Apartment Association (GTAA) www.gtaaonline.com P: 416-385-3435 Hamilton & District Apartment Association (HDAA) www.hamiltonapartmentassociation.ca P: 905-632-4435 Investment Property Owners Association of Nova Scotia (IPOANS) www.ipoans.ns.ca P: 902-425-3572 LandlordBC www.landlordbc.ca P: 1-604-733-9440 Vancouver Office P: 604-733-9440 Victoria Office P: 250-382-6324 London Property Management Association (LPMA) www.lpma.ca P: 519-672-6999 Manufactured Home Park Owners Alliance of British Columbia (MHPOA) www.mhpo.com P: 1-877-222-4560 Professional Property Managers’ Association (of Manitoba) (PPMA) www.ppmamanitoba.com P: 204-957-1224 Saskatchewan Landlord Association Inc. (SKLA) www.skla.ca P: 306-653-7149 Waterloo Regional Apartment Management Association (WRAMA) www.wrama.com P: 519-748-0703
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12 | march 2018
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RENTT: Looking at the rent numbers This issue brings together the RENTT (Rental Executives National Think Tank) panel to discuss issues related to rent, such as changes in rent control guidelines, increasing rent in provinces where there are no rent controls, property taxes and building assessments. RENTT panelists:
David Hutniak, President and CEO, LandlordBC
Andrew Macallum, President, WRAMA
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Al Kemp, President, Executive Director, Manufactured Home Park Owners Alliance of BC
Arun Pathak, President, Hamilton and District Apartment Association
Chanda Lockhart, Executive Officer, Saskatchewan Landlord Association
Daryl Chong, President & CEO, Greater Toronto Apartment Association
Avrom Charach, Director of External Relations â€“ PPMA
Jeremy Jackson, President, Investment Property Owners Association of Nova Scotia
RHB: Welcome to RHB Magazine’s RENTT panel. We appreciate the time and effort involved in participating in today’s discussion and sharing your experience. Our readers will benefit from your input and experience. Today we’d like to talk about issues that affect rent levels. For those of you who live in a province with a rent control guideline, what is your opinion of the new guideline for 2018? Avrom Charach: The Manitoba guideline does not cover our actual increases effectively. However, the fact that our government tied the guideline to the Consumer Price Index [CPI] for Manitoba a few years ago means that we know what it will be each year. That is a positive as compared to the 30 previous years of uncertain guidelines. Andrew Macallum: The guideline rent increase in Ontario is 1.8 per cent for 2018. It is important to understand that in Ontario, rental increases are not only limited by the provincial government and the Landlord and Tenant Board [LTB] to the guideline, but also capped at 2.5 per cent.
sets the guideline at CPI plus 1 per cent or 2 per cent. David Hutniak: For 2018, the Allowable Maximum Increase in BC is 4 per cent. Al Kemp: The BC guideline formula hasn’t changed. The formula found in the Regulations to the Residential and Manufactured Home Park Tenancy Acts is a maximum annual rent increase of 2 per cent plus the increase in the CPI for the 12 months ending the previous July. For 2018, the rent control limit is 4 per cent, while it was 3.7 per cent in 2017. RHB: What does the new guideline mean for your province this year? Avrom Charach: It means that, for approximately 15 years, the government will see a large number of AFRIs [applications for rent increase above the guideline] filed and I have no doubt that CMHC will, as usual, reflect average rent increases well in excess of the guideline.
Arun Pathak: The guideline is too low due to its being tied to CPI. Many landlords’ costs of operating rental properties go up more than the CPI, such as water and sewage rates, hydro, and property taxes. Over the last few years, many landlords have seen increases in pest control costs as much as 500 per cent. Additionally, due to the aging process, all buildings, including owner-occupied homes, need more expenditure the older they get.
Andrew Macallum: It means that every tenant in the province should expect their rent to increase by 1.8 per cent in 2018. The heavy regulation by the province of the residential rental housing industry has created a culture where landlords are very limited in using their judgment when deciding to increase the rent or not. For example, despite having an excellent relationship with a tenant who makes their rental payments on time and respects their rental home, the landlord must increase rent to the maximum guideline level to ensure they are not left in a precarious position when an emergency repair or upgrade is needed. An above increase application to the LTB would be available; however, becoming involved with the LTB is undesirable – particularly to small landlords – due to the painfully slow and negative experiences had by rental housing providers.
Daryl Chong: The rent increase guideline is too low because it is tied to CPI with no additional factor for major repairs or the cost increases driven by aging buildings and increasing retrofit needs. The solution is for the Ontario government to copy the rule in BC that
Arun Pathak: These guidelines are creating a greater disparity of rents within buildings. The little amount of cash flow from landlords’ long-term tenants is dropping every year and landlords are, instead, losing more money every year on long-term tenants who are locked in at a low rent. These tenants, in some cases,
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get trapped in their unit because they can’t afford to go anywhere else. This limits the income of the landlord, which then forces the landlord to increase the rent of the units that turn over to compensate their income. When instead all rents are allowed to be at a reasonable rate, landlords work hard to reduce turnover and keep tenants in their buildings, because it is better to keep a good tenant than to find a new one. Daryl Chong: Arun is correct to point out the discrepancy between rents within buildings. In addition, the low guideline combines with a high demand for rental units to create a growing disparity between rents in existing buildings and in new buildings. This interferes with tenant mobility as tenants who would normally move to a new building or to home ownership stay put in their existing apartment at an artificially low rent. Low rents for some tenants mean higher rents and less availability for other tenants, including newcomers to Ontario attracted by jobs, especially in major centres. David Hutniak: Costs are continuing to increase in BC for taxes, utilities, insurance, etc. In that context, the allowable increase will be inadequate for many landlords, particularly those whose rent rolls are significantly below market. Al Kemp: Because the BC formula has been in place since 2004, it is accepted. So, lobbying BC’s NDP government to remove rent controls would be a waste of effort. Rent controls only apply during a tenancy, so market rents can be achieved on turnover.
RHB: Overall, how will the new guideline affect rent levels for your members? Avrom Charach: As noted earlier, many of us use Part 9 of our Act to obtain increases which reflect our true increases in operating costs. Those that do so will not see serious deleterious effects, but those that do not take advantage of AFRIs will lose ground to higher operating costs. Andrew Macallum: Landlords have been backed into a corner by regulation from all three levels
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of government. The perception is that the left hand doesn't know what the right hand is doing. In fact, in many cases it seems like the right hand doesn't even know the left hand is there. Rents must be increased to hedge against unpredictable costs, such as unpaid rent, unpaid utility bills, student licensing fees as in Waterloo, to name a few. In a small building, it takes only one tenant to create a domino effect by not paying rent on time, or at all, that can cause great hardship. An example is extreme cold periods that were seen this winter. Higher than normal utility costs to provide heat, met with a tenant who does not pay rent, met with a landlord tenant tribunal process that is long and unpredictable, results in a heavy loss that will have a negative impact on other areas of that particular rental business, such as putting off upgrades, maintenance and/or mortgage payments. Arun Pathak: Rent levels have been increasing when there is turnover, in part due to Hamilton’s recent economic revival. Some new investors, and perhaps some old ones, are applying for above-guideline rent increases to recover the costs of improvements they are making to their newly purchased properties to keep up with revival efforts. Daryl Chong: Long-standing rental owners will see compressed incomes, as the discrepancy between rents in existing building and new building widens. That reduces the turnover rate and raises the risk of creating a vicious circle of reduced revenue leading to reduced upgrades, which lead to reduced revenue, etc. David Hutniak: Overall, the increase will allow our members to deliver quality rental housing to British Columbians. However, we are concerned about the future, as the provincial government moves to increase our tax burden with measures such as the new payroll tax. Al Kemp: Demand in BC’s major centres continues to exceed supply, causing market rents to increase more than inflation. The CPI is irrelevant to costs to operate a rental property or manufactured home community. The annual increases in insurance premiums and property
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taxes almost always exceed the increase in the CPI. RHB: If your province does not have a rent control guideline, is there any increase that tenants expect, or that landlords feel comfortable giving? Jeremy Jackson: Generally, in Halifax, rent increases ranging from 1 per cent to 3.5 per cent seem to be acceptable from a tenant’s perspective. Rent increases above 3.5 per cent will, often times, be met with some resistance. Clearly, apartments geared to more fixed income and lower income residents will be more sensitive to rent increases than those targeting the high income, luxury market. Chanda Lockhart: In Saskatchewan, tenants that rent from a member of the Saskatchewan Landlord Association [SLA] would expect to see a six month notice of rent increase. Tenants that are not renting from a member of the SLA would expect to see a 12 month notice of rent increase. The SLA recommends no more than a 10 per cent increase at any given time; however, there is no rent control in place. RHB: Are rent increases keeping up with cost increases? Jeremy Jackson: That depends on market segment. Landlords targeting low-income renters are not achieving adequate rent increases to cover operating cost increases. Rent increases for middle income and higher renters are generally sufficient to cover increased operating costs. This said, Halifax is entering into a highly competitive market period as an influx of highend rentals, currently under construction, are coming to market. As new rentals come to market, we cannot accurately predict whether landlords will be able to continue to obtain sufficient rent increases to cover increased operating costs. Complicating future rental increase is the fact that we are also dealing with rising property
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taxes and high government user fees and utilities, which are adding increased pressure on landlords to raise rents. The big unknown here is, “Will the marketplace allow for higher rents?” Chanda Lockhart: As we do not have a cap on increases, landlords are able to increase rents to keep up with rising costs, should the market allow. RHB: What is your view of the property tax system in your province? David Hutniak: The new NDP government in BC tabled its first budget in February. Where there was initial concern that a new school tax on residential properties, valued at over $3 million, would apply to purpose-built rentals – stand-alone buildings with four or more units– the government subsequently confirmed purpose-built rentals would be exempt, largely due to behind the scenes work by LandlordBC. This was a very significant exemption as the total property tax bill would have effectively doubled for many purpose-built rental buildings. However, owners of rentals with three or fewer units, valued at over $3 million, will be subject to this new school tax, which could be problematic for some, although the universe of such rental housing is not likely to be very large. Al Kemp: Within BC, mill rates differ from city to city; there is no provincial average of which I am aware. There is double taxation in manufactured home communities [MHCs]. BC Assessment assesses the value of individual homes on the site and, in almost cases, vastly exaggerates the actual value of the home. The value of MHCs are assessed based on the homes being on the sites. Further, if a manufactured home owner dies or passes away, any unpaid property taxes on the home must be paid by the MHC owner, even though the community owner does not own or benefit from the home on the rented site! Daryl Chong: In all major centres across Ontario, the municipality charges a higher rate of property tax on rental buildings of seven units or more that it does on single-family homes. In Toronto, the city property tax rate is 2.5 times higher on apartment buildings as it is on a condominium
Housing First programs: How they support landlords
ousing First is a successful and cost-saving approach to ending homelessness for individuals with mental illnesses or addictions, developed two decades ago in the United States. More recently, the Mental Health Commission of Canada conducted the largest ever study of Housing First, which was successfully implemented in five Canadian municipalities. Housing First principles include: • Immediate access to housing with no readiness conditions • Recovery orientation • Individualized and person-driven supports • Social community integration • Consumer choice and self-determination When Housing First programs are delivered with a strong fidelity to the Housing First model, the success rates are high and the benefits flow not only to the tenant but also to the community at large. The focus is on helping people with challenges to find and be successful living in communityintegrated, scattered-site housing, where the supports are flexible and portable. Rent supplements help tenants pay for private market rental units. Private landlords play a fundamental role in the Housing First approach, and so Housing First programs seek to develop effective, lasting relationships with landlords. Support to tenants is typically provided by Intensive Case Managers who are mandated to see their clients once a week. Under Housing First principles, support providers should regularly meet tenants in their apartments – more often in the beginning as the client is getting
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settled. Challenges might come when clients “fire” their workers, when clients refuse the support services or when clients become hard to locate. Support services are voluntary and if a client specifically declines service after starting in the program, that could leave a tenant in a unit without support services. Support workers who work for health organizations may have limits to what information they can provide to landlords, if the client hasn’t given consent. Client information is essentially health information that is protected by the Personal Health Information Privacy Act. This is where a Rent Supplement Agreement, signed by the tenant, the landlord, the support agency and the agency administering the rent supplement, can help to clarify who can talk to whom and, about what. Some level of tenant consent to talk to the landlord is built into a rent supplement agreement, and additional consent can be requested as well. If something goes wrong with a tenancy, landlords supporting tenants in a Housing First program need to know where to turn to for help, and what type of help they can expect. Housing First programs often have a distinct staff position intended to support the landlords. By taking in tenants through the various Housing First programs, landlords improve and save lives, and do the community a great service. Landlords also improve the industry’s public image, and support moves in the direction of portable housing benefits (which the rental industry have long advocated). In accepting and then managing Housing First tenants, landlords need to protect themselves with proactive inspections, and by staying on top of the tenancies through unit inspections.
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unit or single-family home. Other major cities charge rates that are twice as high, and that also applies in many smaller cities and towns. The situation has improved since the 1990s. At that time, the Province moved to charge all residential and multi-residential properties the same tax rate. The Province also took steps that have nudged down the municipal tax rates on rental properties, but more action is needed to make property taxes fair for landlords and tenants. Andrew Macallum: The Ontario property tax system gives a benefit to homeowners and taxes everyone else double or more, including apartments. The aim of having apartments taxed at the same rate as homeowners is going too slow. Arun Pathak: The Ontario property tax system is unfair. It penalizes tenants, who typically earn a lower income than most homeowners, as tenants are forced to pay higher tax rates than neighbouring homeowners. Avrom Charach: The majority of Manitoba renters live in the City of Winnipeg, which charges the same mill rate for rental property as homes. While we do not like the tax system, especially given that school taxes form part of it and we firmly believe those should be tied to personal income, at least we do not get penalized as rental properties in other jurisdictions do. Chanda Lockhart: The Saskatchewan property tax system is skewed against landlords that own multi-family properties. When taxes are changed, little to no changes apply to most single-family properties, but multi-family properties are consistently hit the hardest. Jeremy Jackson: The Tax Assessment Cap system in Nova Scotia disadvantages income property owners. Apartments fall outside the Tax Assessment Cap and, therefore, property tax increases are disproportionally higher than single-family homes and condo owners’ property tax rates. RHB: What is new in taxes this year, good or bad? Avrom Charach: School tax rates are just being announced and they are rising significantly. The property tax rates have not yet been announced but should be increasing by less than 3 per cent.
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Arun Pathak: Ontario has changed to using cap rates for building valuation. However, the costs are still estimated, so the new assessments are not necessarily accurate. Andrew Macallum: We are in the middle of the four-year phase-in, so taxes are either going up or down depending on which way a building was assessed last time. That means taxes either go up or down. The bad thing is the municipalities think property owners have bottomless piggy banks because they increase taxes more than inflation each year on top of the reassessment changes. Daryl Chong: New in 2017, the Province has imposed a freeze on municipal taxes on rental property for those municipalities where the tax rate gap is double or higher. The rental industry and tenants would be better off if the Province moved to make the municipalities bring the tax rates into line. With the freeze, the Province also forced municipalities to bring down the tax rate on new rental construction to match the tax rate on single-family homes and condominiums. That is a positive move, but it produces the ironic situation that older buildings with lower rents, and tenants with lower incomes, are charged a property tax rate higher than new buildings with high rent and tenants with higher incomes. That is a regressive tax system. Chanda Lockhart: In Saskatchewan, property taxes almost doubled overnight in July of 2017 and then scaled back slightly in January 2018 for a four-year phase-in. For example, I know of a 12-unit building with no special circumstances for which the property taxes went from $764 in 2016 to $1177 in July 2017, and now down to $939 in January 2018. Saskatoon, Outlook and Biggar had similar increases and decreases. Al Kemp: I don’t think there are any changes in BC at the provincial level. David Hutniak: Not a property tax… but there was bad news in terms of a new payroll tax to cover the cost of the elimination of Medical Services Plan premiums affecting companies with payrolls in excess of $500,000. This will clearly not impact the secondary market landlords, who make up a large share of the
rental industry in BC. However, larger owners and licensed property management firms will see their costs increase. RHB: With building assessments being done en masse instead of individual building appraisals, what effect does this have on local property taxes? Al Kemp: For MHCs, this can lead to a huge increase. In a given area, perhaps an MHC sells once every 10 years, but the tax assessment is based, in part, on recent sales of comparable properties in the area. For single-family dwellings, there are always several sales. Iâ€™ve heard of assessments rising as much as 40 per cent in one year, solely based on the sale price of one other community. Avrom Charach: This is a seriously flawed system and we have told the City of Winnipeg. They compel us to provide individual reporting on each property but, until you spend time and money to appeal the assessment, they do not take that into account. In todayâ€™s
environment of computerized systems, cities should use site-specific information. Andrew Macallum: The en masse assessments tend to even out building values, raising the assessed value of buildings that are worth less and capping buildings that are more valuable. Chanda Lockhart: Doing assessments en masse penalizes the apartment building owners. It is not an equitable way to charge taxes. Jeremy Jackson: With the Nova Scotia government continuing to take a status quo position by not eliminating the Tax Cap system, and showing no willingness to enter into stakeholder discussions, the situation doesnâ€™t bode well for landlords in future years. The numbers clearly demonstrate there is a runaway spread developing between capped properties (single-family homes and condos) compared to the rental apartment sector.
RHB: Thank you for your time and input.
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Real estate tech trends: Innovation through automation The unprecedented rate at which technology is developing and advancing today will further transform the multifamily industry. Innovation is empowering companies to take efficiency to an entirely new level. If you don’t have a tech strategy in place for your real estate business, now is the time to get started. Today’s executives, employees and customers rely heavily on using smartphones and tablets to complete everyday transactions, as well as stay in touch with the people and businesses that engage and serve them. To empower your staff to work more efficiently from front office to back office, sign new leases and retain residents with convenient online services, you need the right tools at your fingertips.
Marketing automation: target and engage; lease and retain Search engine optimization (SEO) & search engine marketing (SEM) Digital marketing is taking hold of real estate companies because it is agile, it can be measured, it focuses on putting your listings where your best prospects are active and it gets results. With the help of technology and service companies, real estate organizations lacking digital marketing expertise in-house can convert more leases online. Leverage the companies that will help you develop and execute a winning SEO strategy. This should include full-site audits, on- and off-page optimization, strategic feature implementation, and monthly reporting and analytics to let you know where you’re doing well and where you need to improve. For optimized SEM, you need to tailor campaigns based on property needs and occupancy trends. You should target advertising based on demographics, location, timing and mobility.
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And with the right software tools, you can accomplish all of that and see immediate results. Also, using an Internet Listing Service (ILS) with enhanced property listings provides great exposure and delivers measurable results. Online leasing Completing the entire leasing cycle online enables you to see where each prospect is in the process of becoming a resident. With searchable price options and lease terms, self-screening, renters’ insurance fulfillment and utility setup built into an online leasing process, your prospects can speed though the application process while saving your staff time and your business money. Leases can even be signed digitally to complete execution. All you need to do is hand over the keys. Resident services Making it easy for residents to review balances, make payments, and book amenities and concierge services online are a few great ways to ensure that your residents are happy and stay with you. With online concierge services, your residents can authorize guest access, track package deliveries and submit maintenance requests with photos and voice memos. These automated services also save time for your staff. Now you might be wondering, “Do my residents really want these things?” The results of the Tenants Preference Survey presented at the Canadian Apartment Investment Conference in September 2017 revealed some compelling statistics about what today’s renters not only want but expect, including: •
66% visit property websites and read reviews to find a place to live
86% want high-speed Internet (and 34% won’t rent without it)
77% who found their units online are under the age of 40
May 14 - 16, 2018
CFAA Rental Housing Conference 2018
National Discussion - Real Results Join Canada’s rental housing industry in Vancouver Canada’s rental housing conference, be part of the dialogue! www.CFAA-RHC.ca SIGN UP TO RECEIVE MORE DETAILS BY EMAILING: EVENTS@CFAA-FCAPI.ORG
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rentalhousingbusiness.ca | 25
52% wish to communicate with their property managers via email
31% use community website portals
47% prefer online debit rent payments
Chances are, if you’re not currently offering online conveniences, then you’re not meeting your customers’ expectations.
Process automation: track and analyze; maximize and profit Analytics & customer relationship management (CRM) The smartest strategy for running your back office better is automating tasks and services. This includes a streamlined CRM system so that you can quickly turn leads into leases, improve retention and maximize your marketing return on investment (ROI) with analytics that identify your most successful campaigns and prospect sources. Further, the ability to track prospects and residents through a centralized management portal allows you to enhance customer service through instant responses and automated reminders for re-engaging with residents to make sure they’re happy and apt to renew their leases. Business intelligence Today’s business decisions are driven by real-time data. Business Intelligence tools enable you to instantly view performance data across your operations, from marketing and leasing to operations and revenue. Integrated business intelligence solutions combine your real-time operational and ancillary services data to deliver key performance indicators (KPIs) and analytics that are easy to interpret and actionable. You can pinpoint ROI quickly, for example, to determine if your marketing campaigns are delivering leads and leases. And with just a few clicks you can view key data about your entire portfolio. For companies preparing paper reports and spreadsheets, compiling that information can take days. Today’s business intelligence software delivers the insight that leads to greater efficiency and increased revenue to your executives’ fingertips. Paperless procurement Ditching paper purchase orders and invoices saves significant time and money and creates a
26 | march 2018
painless accounts payable process for your staff. For property managers and vendors alike, that’s great news. With automated vendor onboarding and paperless invoice processing and payments, you gain workflows with transparency into the status of every purchase order, invoice and payment. Vendors can upload the required documents and property managers can onboard vendors through the management portal. Once approved, vendors can view all properties and companies on the same platform, with access to purchase orders (POs) and invoices. Property managers can easily process invoices and make payments electronically. No more mailing costs, paper storage, lost invoices or late fees. Bringing it all together To be competitive, you need to ensure the days of working in silos, tethered to your desk and manually processing paper, are behind you. Portfolio-wide integration, where every aspect of your business is harmonized on a single management platform with mobility, is the key to working smarter and more profitably. You’ll reach your prospects and convert leads into leases faster, make your residents happier (and retain them), empower your employees to work untethered and give your executives powerful analytics to make smart decisions that increase your revenue — all while reducing your business costs. It doesn’t get better than that. At the end of the day, by embracing innovation you will set the stage for the future and the new generation of employees who will thrive and push your business forward in this tech-savvy, automated world. Peter Altobelli, Vice President and General Manager, Yardi Canada Ltd.
QUADREAL, Canada’s newest Top Ten landlord, will be presenting a panel on creating its new State-of-the-Art integrated, operations system at this year’s CFAA Rental Housing Conference, which takes place May 14 to 16, 2018, in Vancouver, BC. For more information, please visit www.CFAA-RHC.ca.
rentalhousingbusiness.ca | 27
Communicate on the as your elevator Se You’ve probably heard the expression, “It’s not what you know: it’s who you know.” When it comes to keeping your elevators running, and working with an elevator service provider, it’s vital to know both. It makes good business sense to know who to contact, and what to say, when you need to get your elevators repaired (or find out what’s wrong) as quickly as possible. This knowledge can help you to improve the quality of service, reduce downtime and save money, which are all very good reasons to educate yourself on everything related to maintaining your elevators. 28 | march 2018
Know your service providers It can be difficult to get the answers you need for a task, as your service centre might not be located in Canada. Everything begins with the frontline worker – the person who has done the work on your elevators, and who should be most intimately involved with your issues. However, given that they will also work on other buildings’ elevators, they might not be readily available. At this point, you will have to take your concerns to the next level. Get to know your account representative or manager, as they will have more information than a call centre. Note that they are also salespeople and might require more time to get the answers you need. Next, talk to the Operations Manager, as they are required to have a broader information base and are able to get answers and resolve issues. They usually report to the Branch Manager, who would be your next point of contact should your concerns require escalation to this level.
the same LEVEL Service Provider “Smaller companies are a little easier to deal with, as they are more localized and normally have in-house call desks,” said James Frain, Director of Educational Development, Elevating Devices Training Academy and Quality Allied Elevator. “The person answering the phone might be able to assist in minor requests, like an updated ETA for their technician.” Whoever you happen to reach, you should always be able to request call back history on your equipment. Your service provider must provide you with this information regardless of your reason, as they should have it readily available. You can also request maintenance records if there are discrepancies between the Maintenance Control Program (MCP) log in the machine room and the service provider’s contractual obligations. “This might be a bit of a process with a multi-national but it is usually an easy fix with a smaller independent company,”
said Frain. “You must remember that you are paying a substantial amount of money every month for a specific service and that you are entitled to information about your equipment. This is supposed to be a customer service-based industry.”
Know your issues There are many reasons why you might need to contact your service provider. It could be part of your capital planning, which would require some detailed discussions on potential direction and budgetary issues. It could be as straight-forward as wanting an estimated time of arrival after placing a service call for equipment maintenance or repairs. Before you call your service provider, be absolutely clear on your issues and what you need. Compile the information you need, and educate yourself on the equipment and problems that you want to discuss.
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#reflections, with its biopic format, provides us with an inside look into the lives and professional milestones of Canadaâ€™s leading real estate executives. Our upcoming episode features Paul Chisholm of Berkley Property Management Inc.
To watch the trailer now, visit: www.perpetualmediagroup.ca/reflections
30 | march 2018
rentalhousingbusiness.ca | 31
What’s that? Elevator Edition Spirator
Function of the spirator: Inside Hall Door
Safeties (under the elevator)
Mechanically assists the hall door to close completely
Pick up roller assembly
Drive Machine & Motor
Function of the pick up roller assembly:
Function of the drive machine and motor:
Engages a clutch on the car door to lift the beak and unlock hall door
Lifts and lowers the elevator
A – this shows the beak inside the lock in the closed & locked position Controller
Function of the controller:
Function of the door operator:
Function of the governor:
Tells the elevator what to do, the doors to open and close, and knows when there is a problem and is not safe to run
Opens & closes elevator doors accordingly
Clamps down on the governor rope in an overspeed condition and activates the safeties
For example, if you have a question about one elevator car in a specific building, then make note of the car number or installation number. If you want to discuss a technical problem with an elevator, then provide as much detail as possible. This could include what was witnessed happening, the time frame over which the problem occurred, how long the problem has been happening and so on. “Ask your service provider for a detailed report on the service calls for the last number of months, especially if you are not happy with how the elevators have been performing,” said Frain. “When speaking to them, make note of who took the call and what was involved in the repair, and get as much detail as possible for what happened on the service call. For example, if the same problems are recurring, you need to find out why it’s happening so you can be educated on the performance of your equipment.”
32 | march 2018
B – interlock or lock, these are the two contacts that the beak crosses to tell the controller that the door is locked and ready to go C – this is the beak that locks the hall door mechanically and electrically with a shorting bar that crosses two contacts in the interlock or lock
Part of knowing about your elevators and issues includes measuring your service provider’s performance. Make note of key indicators, such as the number of service calls per year, the number of chargeable calls per year, the typical cost of a service call, the number of inspections performed and elevator down time. You will also want to make note of the number of TSSA directions for each TSSA periodic inspection, the time required to correct TSSA directions and the average number of TSSA shutdowns. These are all good indicators of the quality of your service provider’s work on your elevators.
Know your elevators It’s important to know as much as you can about your elevator equipment (see sidebar page 32). This will help you to understand what different components do, and what the elevator service person is talking about when doing repairs or maintenance. You don’t have to be an expert (that’s why you contracted an
elevator service company), but you should know what the equipment does, what it costs to replace and what to look for when there are problems. You should also perform simple daily checks to improve your knowledge of your elevator equipment, and reduce chargeable callbacks. A daily check should include the following: 1. Ride the elevator. 2. Listen for noise in travel. 3. Check door operation at each floor. 4. Check the levelling at each floor for tripping hazards. 5. Check car and hall sills (tracks) for debris – vacuum if necessary. 6. Check the buttons in the car and halls for operation and any bulbs that might need replacing. 7. Check main floor indicator for burnt out lights. 8. Check handrails in the cab to see if they are loose. 9. Make sure detector (sensor) lenses are clean.
“If the detector edge fails to reopen the door, take the elevator out of service immediately and place a service call, as this is a safety issue,” added Frain.
Conclusion You don’t have to be an expert in how your elevators work – that’s why you hired a service provider to keep them running. But you need to know who to talk to, and what to say, to make the most of your elevator service relationship.Make sure that you have all the information on hand before making that next phone call to your elevator service provider. You’ll get better results and keep your tenants happy and moving… up and down, not out. By David Gargaro, in collaboration with James Frain
rentalhousingbusiness.ca | 33
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Corporate tax changes take a new turn By John Dickie, President, CFAA
As noted in an earlier report, 80 business and professional groups came together, in the Coalition for Small Business Tax Fairness, to oppose the corporate tax changes first proposed in July 2017. CFAA is an active member of the Coalition. Due to intense opposition from the Coalition and other business people and professionals, the government
The proposed federal corporate tax changes only apply to people who receive income as dividends derived from Canadian-controlled private corporations (CCPCs), or who hold real estate through such corporations. That includes many landlords and rental housing suppliers.
Business owners can employ family members and pay them wages or salaries which are reasonable for the work they do. If a family member is paid more than is reasonable, then Canada Revenue Agency can assess the business owner for taxes as if the excess amount of salary or wages were the company’s income, or in some cases, the business owner’s income. Until the current changes, a business owner who operated through a corporation which was set up correctly could pay dividends to family members without risking the attribution of that income to him. That was a form of income splitting. The government still intends to prevent much of that income splitting by testing the reasonableness of the
has backed down on two of its four reform proposals, and has watered down the remaining two. However, Finance Minister Morneau is proceeding with revised versions of two of the proposals, as laid out in December and in Budget 2018, released on February 27. The new regime has not yet been enacted.
There are no plans to affect people who hold real estate in their own name (or with their spouse), or public companies or REITs. Investors who currently pay tax at the top personal rate on passive income should also not be affected.
payouts compared to the capital and work contributed to the business. Thanks to the opposition of CFAA and the Coalition, the government has made it clear that past contributions will justify current dividends, and has provided “bright line tests” to make it easier to know that a business and a person qualify to split income. Corporate owners will be able to split income with these people: •
The business owner's spouse, provided that the business owner meaningfully contributed to the business, and is aged 65 or over.
Adults aged 25 or over who own 10 per cent or more of a corporation that is not a professional corporation, and earns less than 90 per cent of its income from the provision of services.
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Energized for Tomorrow 36 | nov 2017
NATIONAL OUTLOOK •
Adults aged 18 or over who have made a substantial labour contribution (generally an average of at least 20 hours per week) to the business during the year, or during any five previous years. Individuals who receive capital gains from qualified small business corporation shares, if they would not be subject to the highest marginal tax rate on the gains under existing rules.
Along with many members of the Coalition, CFAA is still opposing the restrictions on income splitting. In particular, we are seeking the exemption of all spouses from the new rules, and for the new rules to begin for the 2019 tax year, rather than in 2018. Recently the Parliamentary Budget Office released a report that suggests that the increase in taxes due to the income splitting changes will be two to three times as large as the Finance Department projection.
Taxing passive income earned within a corporation Compared to income earned by individuals with a good income, active business income earned by all corporations is taxed at a low rate (and small business income is taxed at a very low rate), and that differential will continue. The government believes that differential gives business owners an advantage over other people who pay tax on their incomes at the standard rates. Until February 27, 2018, the government proposed to increase the tax rates on such “second generation” income above normal rates, potentially to 73%. The government proposed a system to track corporate income according to what tax rate has been paid on it (which would have been an accounting nightmare.) CFAA and the Coalition
strongly opposed that approach and those high tax rates. In Budget 2018, the government announced a new approach. CCPCs with less than $50,000 of investment income in a year will continue to be largely unaffected. The budget proposes to reduce the small business limit on a straight line basis for CCPCs that have between $50,000 and $150,000 of investment income. The budget reduces the small business deduction by $5 for every $1 of investment income above the $50,000 threshold. The business limit would be zero at $150,000 of investment income. See the examples in Table 1. Table 1: Sample impacts of the latest passive income plan Investment earnings
Limit of corporate income eligible for the small business tax rate
0 – $50,000
Currently, the small business limit is reduced when the corporation has taxable capital employed in Canada between $10 million and $15 million. The reduction in a corporation’s business limit will be the greater of the reduction under the new measure and under the existing taxable capital reduction provisions. The new approach to passive income is certainly a simpler approach than the original proposal, and is positive on balance.
Want to stay up to date with national outlook? Sign-up for CFAA’s National Outlook e-newsletter to receive up-to-date news on what is happening across Canada, as well as industry insights and insider information on CFAA happenings. Email email@example.com to start receiving National Outlook today!
rentalhousingbusiness.ca | 37
CFAA and most members of the Coalition are seeking an amendment to grandfather income on investments owned as of 2017. The government had promised grandfathering in October 2017, but went back on that in moving to the new approach in February 2018.
The steps to implement the increase in the Working Income Tax Benefit.
CFAA’s reaction and action While we would have preferred the government to scrap its changes to the taxation of CCPCs entirely, the government’s changes since July have reduced the impact of the reform. CFAA invites input from landlords who will be affected if the proposed changes are enacted. Member associations and landlords are invited to check CFAA’s website for CFAA’s submissions and the latest information, and are invited to email firstname.lastname@example.org with their issues and concerns. Please also send us any letter or submission you sent or send to the government on the tax issue.
Positive measures in Budget 2018
Besides welcoming the changes to the corporate tax reforms, CFAA applauds other measures in Budget 2018, and has the following comments on them.
The increase in funding for the Rental Construction Financing Initiative, which provides direct CMHC loans for energy efficient, mixed income communities, including some to be built by for-profit developers. The steps to address the housing shortfalls in Indigenous communities.
38 | march 2018
That is a difficult problem to solve, especially with the limitations on financing imposed by the reserve system which involves common ownership, and prevents ready access to financing.
CFAA and the landlord community approve of measures to provide low-income people with the incomes they need, especially measures that reward work and offer a path to greater self-sufficiency.
CFAA Rental Housing Awards 2018
CFAA’s Rental Housing Awards winners will be announced at the CFAA Awards Dinner on Tuesday, May 15. The deadline for applications is April 9. The categories open to many landlords include: • • • • •
Renovation of the Year Rental Development of the Year Off-site Employee of the Year Property Manager of the Year On-site Employee of the Year.
To learn how to enter the awards competition, to judge, or to sponsor, please email email@example.com. For more information about the conference, please visit www.CFAA-RHC.ca, or email me or firstname.lastname@example.org. All net proceeds of CFAA-Rental Housing Conferences go to support CFAA’s federal lobbying efforts on behalf of the rental housing industry! Please register now to join us there!
CFAA Rental Housing Conference
May 14 to 16, 2018 The Canadian Federation of Apartment Associations (CFAA), invites you to join us at Canadaâ€™s Rental Housing conference at the Coast Coal Harbour Hotel in Vancouver, BC. www.CFAA-RHC.ca Thanks to Principal Sponsor:
With special thanks to:
rentalhousingbusiness.ca | 39
MARCH 2018 Building Innovations Tour
In 2017, Hollyburn Properties won Rental Housing Development of the Year for their stunning “Bridgewater” development in North Vancouver. The building is the synthesis of Hollyburn’s four decades of property management experience. CFAA’s judges praised it for its modern, community oriented design and environmental practice. This year, attendees on the Building Innovations Tour will have a chance to see first-hand what made the Bridgewater stand out among the competition in 2017. The tour will also feature “The Duke” by Edgar Development, a 14-storey, 201 units mixed-use development in Mount Pleasant, Vancouver. With its LEED Gold certification, European inspired design, and public art installation, The Duke is also worthy of a national showcase. Visit www.CFAA-RHC.ca for more information about Rental Housing Conference 2018 in Vancouver.
Top: Bridgewater, North Vancouver Bottom: The Duke, Mount Pleasant, Vancouver
40 | march 2018
CFAA Rental Housing Conference 2018 by Jeremy Newman, CFAA Director of External Relations CFAA will be holding Rental Housing Conference 2018 on May 14, 15 and 16 in Vancouver, British Columbia. The Building Innovations Tour will take place in the afternoon of Monday, May 14. That will be followed by the Welcome Reception. The education sessions will take place over May 15 and 16.
The theme is the Future of Rental Housing in Canada. Sessions will cover key aspects of rental housing that apply to landlords in BC and across Canada. Choose among these topics:
• Economic Update – by keynote speaker Benjamin Tal, Deputy Chief Economist of CIBC World Markets.
• Executive Roundtable - including Todd Cook, President & CEO of Northview REIT, Brian McCauley, President & CEO of Concert Properties, and Anthony Lanni, SVP, Residential of QuadReal.
NATIONAL OUTLOOK • Employment law developments in BC and Canada. • Marijuana rules in BC and Canada.
• “Building a State-of-the-Art operations system”. QuadReal, Canada’s newest Top Ten landlord, will present a panel on creating its new State-ofthe-Art integrated operations system, including details of QuadReal’s mobile maintenance system, which makes use of both on-line information exchange and a call centre; and their automated “Procure to Pay” procurement system, which eliminates paper-based POs, invoices and cheques.
• “Rental Development issues across Canada”, a panel discussion including planners and developers that will propose solutions and strategies to mitigate roadblocks in new rental development.
• Cynthia Jagger and Sandra Cawley on BC Building Sales. • Many other sessions on operations, investing, technology, and political and legislative updates.
For more information, or to register, go to www.CFAA-RHC.ca.
• Protecting your on-line reputation. • CMHC’s assistance for mixed income rental developments – the Rental Construction Financing Initiative. • The impacts of the new corporate tax regime, restricting income splitting and restricting access to the small business tax rate.
• British Columbia Roundtable, including David Hutniak of LandlordBC, Jason Fawcett of Kelson Group and David Sander of Hollyburn. Learn the commonalities and differences in issues faced by landlords in BC and the rest of Canada.
rentalhousingbusiness.ca | 41
42 | march 2018
RHBâ€™s forum for rental housing associations to share news, events and industry information
Hot topics: Property taxes, standard leases, safety & revitalization My first piece of advice to landlords in Ontario is to make sure that you take the time to inform yourself and your employees about the mandatory standard lease (MSL) that is required as of April 30, 2018. Andrew Macallum â€“ p. 49
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44 | march 2018
City of Ottawa Updates — Property taxes
This year, the city staff report on property tax ratios is to go to the Finance and Economic Development Committee (FEDco) on Wednesday, April 4. EOLO is optimistic that the City will follow the same practice that it has followed in recent years, and will adopt revenue neutral tax ratios. That will mean that the multi-residential tax ratio will be reduced from 1.45 to about 1.42. If that is the advice from City staff and the decision of City Council does follow that practice, then, on average, rental buildings and tenants will pay the same percentage property tax increase as homeowners, and not a higher percentage. EOLO still believes that the multi-residential tax ratio should be reduced to 1.0, so that tenants pay the same tax rate as homeowners, but small steps in the right direction are better than no steps in the right direction, and much better than any steps in the wrong direction. Individual properties will still see increases or decreases in addition to the average tax increase, based on changes in each property’s assessed value.
New program mandates backflow prevention devices The Building Code now requires backflow prevention devices be installed in new rental construction to prevent water from running back from a building into the city’s water pipes. However, that was not the case in the past, when many rental buildings were built. The City of Ottawa has now enacted a backflow prevention program, requiring retrofits in commercial, industrial and institutional buildings, as well as rental buildings of six units or more.
Over the next five years, the City will mail out notices to property owners on a staged basis. The first set of notices will go to buildings that represent a severe hazard because of the nature of water use on the property. From the date of notification, owners will have one year to complete a site survey, and two years to install one or more backflow devices. Virtually all residential rental buildings are considered to be moderate risk. They will receive notices between the years 2020 and 2022. From the date of notification, owners of those buildings will have one year to complete a site survey, and three years to install one or more backflow devices. Properties scheduled for demolition within the implementation timelines may be exempt from the requirements. For properties with multiple water meters, one survey is required for each water meter. The site survey must be completed by a qualified person, such as a plumber licensed as a Certified Cross Connection Control Specialist under the Ontario Water Works Association, a professional engineer or a certified engineering technologist under the direction of a professional engineer. (Additional people are qualified to install devices or to test them. See the City’s website for more details.) The site survey is set up to be completed from a mobile device. An administration fee of $53 will be required. If a completed survey indicates the requirement for the installation of a new backflow prevention device, replacement of a defective device or the relocation of an existing device, the owner or contractor must obtain a building permit prior to the commencement of any work, with a fee of $80. Backflow prevention devices must be tested at the time of installation and annually. Property owners
rentalhousingbusiness.ca | 45
will receive a reminder of their annual testing deadline 30 days in advance. Property owners with existing devices and test data are encouraged to submit their most recent information to https://www.bsionlinetracking.ca/. For questions or further information, please contact the Backflow Prevention Program Coordinator at email@example.com. EOLO invites you to contact us at firstname.lastname@example.org if you run into what seems to be a systemic problem.
Agencies come around on landlord notification In the December issue of Regional Association Voice, EOLO reported on a Housing First situation in which the agency involved dropped the ball. The case was also reported by CBC. The landlord got the impression that the agency worker was making sure the tenant was keeping the unit clean, and did not check the unit for five or six months. The worker admitted to the media that he had not visited the unit. As a result of those two problems, and a serious failure by the tenant, the unit became an ugly mess with floors covered one or two feet deep in pizza boxes, dirty dishes, rotting food and personal belongings. The necessary clean-up was extensive. At the time, the agency took the position that they are working for the tenant only, and cannot disclose any information about the tenant to the landlord. EOLO believes the Housing First programs should support both tenant and landlord, so that if a problem arises, the agency can inform the landlord. On their part, landlords need to perform unit inspections, either as part of a meeting with the agency worker or on their own. An agency representative is to attend the upcoming EOLO Education and Networking Event on April 18. He will discuss the situation and announce the new plan to inform landlords if their worker is not gaining access to the unit, with a recommendation that the landlord do an inspection. Landlords will be well advised to take that information and recommendation to heart, and to inspect promptly (with appropriate 24 hours written notice). Housing First workers vary in how good they are at getting tenants to comply with their obligations. Some workers are great, but others are not as good. By taking in tenants through the various Housing First programs, landlords improve and save lives, and do the community a great service. Landlords also improve the industryâ€™s public image, and support moves in the direction of portable housing benefits (which the rental industry has long advocated). In accepting and then managing Housing First tenants, landlords also need to protect themselves by proactive inspections, and staying on top of the tenancies. It appears that Ottawaâ€™s Housing First agencies now better understand the issues, and are likely to provide the necessary critical information to landlords in the future.
46 | march 2018
Housing for the poor and homeless On March 22, the City of Ottawaâ€™s Community and Protective Services Committee reviewed the results and the plans under the Cityâ€™s Ten Year Housing and Homelessness Plan. Since 2014, the City has supported the completion of 364 new supportive housing units, and created 386 new rental subsidies. Housing First programs housed 519 people who had been chronically homeless. Of those, 47% moved into private market rental housing, 19% moved into social housing and 34% moved into supportive housing. For 2018 and beyond, the plan is to complete 378 affordable housing units and 78 affordable supportive housing units, and to create 380 new rental subsidies, including 310 that will come with supports. The new rental subsidies will increase their number by 9%. The new supportive housing units will increase their number by about 5%. The new units providing affordability, but not other supports, will increase their number by about 2%.
Other funding is to support the Ontario Renovates Program for low-income homeowners and private landlords, including rooming house operators. EOLO applauds the increases in rental subsidies, as well as the increased focus on supportive housing. For the same amount of public money, rent subsidies help more people than building new social housing units. At the same time, supportive housing is needed for people who cannot maintain their housing in the private market or in most social housing, even with supports.
Ottawa Police seeking easier access to high-rises The Ottawa Police Service recently approached EOLO to announce that they are setting up a system to obtain easier access to high-rise buildings with electronic entry systems. Through the dispatch centre, they will keep a record of the codes. They will securely transmit them to officers who need to enter the building. This is a plus for owners and for public safety. Stay tuned for more info.
rentalhousingbusiness.ca | 47
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48 | march 2018
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Ontario’s mandatory lease implementation Andrew Macallum
My first piece of advice to landlords in Ontario is to make sure that you take the time to inform yourself and your employees about the mandatory standard lease (MSL) that is required as of April 30, 2018.
However, the rules requiring the standard lease will only be in effect starting on this date. Courtesy of the Ministry of Housing (www.mah.gov.on.ca)
There are many questions about the about the MSL that include: •
In case you weren’t aware…
Information for landlords and renters If you sign a lease on or after April 30, 2018, it must be a standard lease. If you sign a lease on or after April 30, 2018 that does not use the standard lease, renters can ask the landlord for one in writing. The landlord must provide one within 21 days.
Are landlords provided the same power as tenants to demand that an MSL be used during an existing tenancy? Is providing space for attachments and addendums with the MSL not opening the door to having different leases throughout the province? Is this the same issue the provincial government cited a reason to implement a standard lease in the first place? Can an MSL introduce new terms to an agreement such as not permitting smoking inside a rental unit?
Renters cannot ask for a standard lease if they sign a lease before April 30, 2018, unless they and their landlord negotiate a new lease agreement with new terms on or after this date (for example, if the tenant were to sign a new lease for a one-year term). Additionally, renters cannot ask for a standard lease if they sign a fixed-term lease before April 30, 2018, and it renews automatically to a month-to-month tenancy after April 30, 2018.
These are just a few items that I am sure will arise over the months after the MSL is put into practice.
If a landlord fails to provide the standard lease within 21 days after a renter has asked for it in writing, the renter may withhold one month's rent. If the landlord fails to provide the standard lease within 30 days after the renter has begun withholding rent, the renter does not have to repay the one month's rent. Please note, tenants cannot withhold more than one month’s rent and they must continue paying their rent for the term of their lease, even if the landlord never provides the s tandard lease. However, if a standard lease is not provided, special rules allow the tenant to end their fixed-term lease early.
My second piece of advice to landlords in Ontario is to make sure that you take the time to inform yourself about the upcoming provincial election in June. Know your representatives and whether their political parties are committed to supporting rental housing providers and the provision of desperately needed rental housing. And be sure to vote.
Landlords and renters can choose to use the standard lease before April 30, 2018.
Be sure to visit www.wrama.com for information about workshops and resources that can help you navigate the introduction of the MSL. With informative guests scheduled for the meeting on March 14, 2018, we hope WRAMA members are able to exemplify the best in rental housing provision.
WRAMA celebrated Valentine’s Day at its meeting on February 14, 2018 and welcomed Ralph Schmidt, Fire Prevention Officer from the City of Cambridge Fire Department, and Rick White and Rob Aide from Rubbersource. Rob Aide, president of Rubbersource, shared information regarding the technology
rentalhousingbusiness.ca | 49
Rubbersource’s Rob Aide & Rick White
Rubbersource application to building
his company uses in applying a seamless coating for flat roofing. Compared with traditional flat roofing that typically uses asphalt and gravel, Mr. Aide pointed out that the application of polyurea is much lighter, seamless and designed for the extremes of hot and cold in Canada. Ralph Schmidt is a landlord and has worked as a firefighter and fire prevention officer for the better part of 12 years. Sharing case studies from inspections at rental properties, Mr. Schmidt highlighted the responsibilities of both landlords and tenants in keeping buildings safe and compliant. The City of Cambridge Fire Department Ralph Schmidt, Fire Prevention Officer, City of Cambridge, shares his insight. has a Fire Prevention division that helps the community learn about preventing fires and other safety hazards, including the rules and regulations for carbon monoxide and smoke alarms.
Smoke alarms Every home must have working smoke alarms on every level and outside sleeping areas. It’s the law! Smoke alarms provide early warning and time to leave when there's a fire. A large portion of fire deaths in the home occur at night, while occupants are sleeping.
Installation and maintenance Since smoke rises, install smoke alarms on the ceiling or high on the wall. Avoid placing them close to bathrooms, heating appliances, windows or fans. For greater protection, install alarms inside bedrooms. Homeowners must install and maintain smoke alarms on every level of the home and outside sleeping areas. Landlords must also comply with the same law as homeowners, installing and maintaining smoke alarms for their tenants. Tenants must contact their landlord if they do not have the required smoke alarms. It is against the law for a tenant to tamper with a smoke alarm.
Smoke alarm safety checklist Test smoke alarms monthly. Change the batteries at least once per year. Gently vacuum once a year with soft brush. Replace smoke alarm when it exceeds the recommended life cycle (usually 10 years). Replace an alarm earlier if it is not working correctly or damaged. Learn more about smoke alarm safety.
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MaxiAids smoke alarm for the deaf or hard of hearing
Types of smoke alarms
Smoke alarms with high decibel alarms or strobe lights are available for the hard of hearing. Visit the Canadian Hearing Society for more information.
If you live in an apartment, remember the following tips for exiting your building during a fire or emergency: Always use the stairs; never use an elevator in case of a fire. Do not use elevators even if they appear to be working (when the alarm sounds, elevators may be grounded and under the control of the responding firefighters). If fire or smoke blocks your exit, protect yourself and your family by:
A fuel-burning appliance A fireplace An attached garage
A CO alarm is also required for apartments adjacent to a space with a fuel burning appliance or fireplace or garage.
Quick facts about carbon monoxide (CO):
Since April 2015, Ontario law has required home-owners and landlords to install carbon monoxide (CO) alarms next to all sleeping areas if your home has:
Carbon monoxide alarms
Any device that burns fuels can produce CO gas, including stoves, fireplaces, generators and engines. Exposure to CO gas can cause flu symptoms. At high levels, CO gas can cause loss of consciousness or death.
There are several types of smoke alarms. Electricity or battery, or a mix of both, can power alarms. Many alarms have a pause feature, which you can use to silence an alarm for a brief period.
• • •
Carbon monoxide detector
CO is a colourless, tasteless and odourless gas. Fuels that do not have enough air to burn completely produce CO gas.
Closing your apartment door, but do not lock it Covering all cracks where smoke could enter by using wet towels or tape Calling 9-1-1 even if firefighters are already onsite, and telling them the number of your apartment Waving a sheet or towel from the window to help firefighters locate you Trying to stay calm and listening for instructions from fire personnel
Discover the benefits of being a member of our association The mission of the Waterloo Regional Apartment Association is to actively and positively develop and sustain the integrity of its members’ business – the provision of private residential rental accommodation – in Waterloo , Kitchener, Cambridge, Guelph and surrounding areas. To view the full range of valuable property managment resources we offer to our members, or to apply online go to http://wrama.com/, or contact WRAMA at 519-748-0703.
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Weâ€™ve got you covered!
RHB Newsreel Keeping you up to date and informed on all industry news across Canada 52 | march 2018
President’s message — LPMA helps members prepare for the new standard lease The new provincial standard lease comes into effect on April 30. Are you ready? During the last few months, LPMA has been working with industry personnel and lawyers on additional terms and conditions. They include sections of the Residential Tenancy Act not present in the standard lease, which we believe will aid both landlords and tenants. These terms will be available to members and associations before April 30. LPMA will also be conducting a seminar on March 26 to review the standard lease and terms. Members can choose between the afternoon or evening session. We recommend that all landlords and staff attend to ensure they’re completing the lease properly. The objectives of the lease include reducing disputes and illegal terms in leases. And don’t miss the annual LPMA Trade Show on April 10! It will be held at the Hellenic Community Centre from 6:00 p.m. to 8:00 p.m. Lisa Smith, President
Direct payment can reduce the risk of eviction in situations where tenants are experiencing challenges with making rental or utility payments on time. Post-dated cheques are another option, as are automatic withdrawals. These methods can be suggested to the tenant, but they can’t be made mandatory under the Residential Tenancies Act. If landlords want to avoid evicting an otherwise good tenant, there are some alternatives. The Salvation Army Centre of Hope offers The Housing Stability Bank, in co-operation with the City of London, London Hydro and Union Gas. It provides financial assistance to low-income Londoners to find and keep their housing, and to those at risk of homelessness to remain housed. The bank offers the following three services:
Programs help low-income Londoners pay their rent on time It’s not uncommon for tenants to fall behind in their rent when their work hours are reduced or they experience a serious illness. Fortunately, there are different approaches that landlords can take, depending on their tenant’s source of income. Direct rent payments: Tenants who are on Ontario Works or the Ontario Disability Support Program can have their rent paid directly to their landlord out of their benefits. Direct payment can be requested by the landlord or tenant, and can also be initiated by the program case worker. However, the case worker should discuss it with the tenant beforehand.
Interest-free loans to assist with rent arrears, first month’s rent for ODSP recipients only and/or last month’s rent Grants, until funds are exhausted, or interest-free loans to assist with utility arrears Money Coach, a free service for anyone who needs help with general household finances, cash store loans, basic banking services and income tax preparation
Two programs help consumers to pay their utility bills: • Ontario Electricity Support Program, from the Ontario Energy Board (OEB), lowers electricity bills for lower-income households. It provides a monthly credit, applied directly to the bills of eligible customers, based on household income and size. They can apply online at www.ontarioelectricitysupport.ca.
Low-Income Energy Assistance Program, also from the OEB, provides a one-time grant toward consumers’ electricity or natural gas bill if they are
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behind on their bill or are in arrears. Qualifying depends on the number of people in the house and their combined household income. Low-income customers can receive up to $500 in emergency assistance for their electricity bills ($600 if their home is heated electrically) and $500 for their natural gas bills.
Keeping attics cool solves many problems for landlords Prevention is the key to avoiding many issues and the exterior maintenance of rental properties is no exception. Instead of responding to the same roofing or foundation problems year after year, it’s far preferable to deal with the cause, experts say. Nick Graham, outside maintenance supervisor for Sifton Properties, says that his approach starts in March with inspecting the company’s properties, which encompass nearly 1,000 townhomes and five apartment buildings in London. Once the maintenance crew devises a plan, they address safety issues first and then repair less urgent problems once the weather cooperates in April. “Safety is always the biggest thing when you’re a landlord,” Graham stresses. Workers check that the soffits in townhomes are properly ventilated and are drawing in cold air to help the attic breathe. That’s important because a lack of ventilation in an attic, and inadequate insulation in a unit, can cause the heat from the unit to escape into the attic. Graham says the attic temperature should be the same as the outdoor temperature to prevent the snow on roofs from melting and soaking into the plywood beneath the shingles. The water then drips into the attic and onto the ceiling and walls of the second floor where mold can form. “In an ideal world, that attic should be the same temperature as outside so you don’t want the snow to melt, you want it to stay there,” Graham says. “We run into a lot of problems with heat loss from the units into the attics or from tenants leaving their windows open and cranking their heat up. That causes everything to heat up at the roof and causes the snow to melt.” Sifton uses several preventive approaches, including asking tenants to keep their windows closed and setting their thermostats at a reasonable temperature.
Workers also place a weatherproof membrane that acts as an ice and water shield on shingle roofs. The membrane extends from the eavestroughs to up to four feet on the roof so that ice and water won’t back up under the shingles and soak into the plywood underneath, rotting it and dripping into the attic. Graham says landlords should also pay attention to icicles.
“Icicles are a good tell. If you have icicles on your home, then chances are your attic’s not venting properly,” says Graham. An attic that’s too warm poses other hazards when snow and ice on roofs melt and the water fills the eavestroughs.
“The majority of that ice is going to collect right at the eavestroughs. It melts and it’s a lot of weight for the eavestroughs to handle and sometimes it can cause them to pull right off.
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The challenge is you can’t really fix it in the winter so you do what you can or wait until the weather cooperates,” Graham says. Workers also inspect the exterior of townhomes to ensure there hasn’t been damage to the bricks and dryer vents. If the bricks appear wet, it’s a sign that the water inside a downspout has frozen and the ice has caused the downspout to expand and crack during the winter. When the weather warms up, the compromised downspouts can’t handle the rain and the excess water soaks the bricks. “If bricks are being damaged, it’s usually from moisture,” Graham says. Graham advises landlords to ensure that lawns slope away from their buildings. The area where the bricks meet the foundation is vulnerable so it’s best if one foot of foundation is visible to prevent water from infiltrating the building. As well, downspouts should be directed away from the foundation to keep water from pooling and finding its way into basements. Melting snow also reveals problems in parking areas, such as concrete parking bumpers that have been pushed out of place by snowplows, as well as signs and retaining walls that have been damaged and railings on steps leading down to parking lots that become dislodged. Salt and freeze-thaw cycles can result in sinkholes and areas where the asphalt has heaved from the infiltration of water that later freezes. If it’s too expensive to resurface an entire parking lot, Graham suggests having the cracks sealed to prevent moisture from getting into the cracks and causing further damage.
“Once you have water under the surface of the asphalt, that’s when you can run into problems,” Graham says. Potholes in parking areas should receive priority attention since they pose safety hazards to residents. It may have to be a temporary fix that can be permanently repaired when the weather is warm enough to fully address the problem. As an ongoing practice, Sifton piles the snow at the low end of the parking lot so the water doesn’t run across the surface and then freeze, causing slip and fall problems for residents. They also use environmentally friendly ice melting products with a magnesium or calcium base that result in fewer concrete repairs even if they are more expensive. “From a landlord’s standpoint, we know we have to salt because it’s all about liability and due diligence but, at the same time, salt’s not good for the property,” Graham says. “When possible, we want to use products that are a little more environmentally friendly and less corrosive.” To prevent problems next winter, Graham advises landlords to investigate the rebate programs currently being offered by Union Gas in partnership with the provincial government and Save on Energy. “There are some good grants out there for insulation and windows. If you do take advantage of them, follow up with the contractors and make sure the job was done properly,” Graham says. “Educate your tenants on proper living in the winter with respect to heating your home and keeping doors and windows closed.”
London Property Management Association (LPMA) is a non-profit organization, located in London, Ontario, Canada, that provides information and education to landlords. LPMA represents the interests of both large and small property owners. The association has more than 400 landlord members representing approximately 35,000 rental units. Membership is open to landlords and property management professionals who own or manage one or more residential rental units.
Sign up online or call Brenda Davidson. Ph: 519-672-6999 Web: www.LPMA.ca
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COMFY LIVING FOR TENANTS. COMFY ENERGY BILLS FOR YOU. Weâ€™ll cover up to 50% of the cost when you upgrade to high efficiency equipment. The Affordable Housing Conservation Program provides incentive for insulation upgrades, heat recovery, building automation systems, building assessments and other custom measures.
Learn more at uniongas.com/affordablehousing.
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The “Promoting Code Compliant, Affordable, Safe, Clean and Healthy Rental Housing” discussion paper is a collaborative “Made in Hamilton” solution that could remove the threat of licensing rental housing providers. The paper was created through a round table discussion with a group of stakeholders in Hamilton, facilitated by Maple Leaf Strategies. On February 6, Brad Clark from Maple Leaf Strategies presented the paper to the planning committee. During that meeting, the planning committee approved that City staff look at the 25 recommendations in the discussion paper and report back to the rental housing subcommittee. We hope the City adopts these suggestions as an alternative course to improve housing throughout Hamilton instead of licensing housing providers. - Arun Pathak, President, HDAA
The good, the bad and the ugly sides of change The “revitalization” of Hamilton has hit a few bumps in the road to change. Some residents have clashed with the “gentrification” of neighbourhoods across Hamilton. The view of revitalization and its benefits varies depending on what side of the gentrification discussion you are on. There is an argument that these changes are only bringing back something that Hamilton once had back in the 1960s, before the economic downturn in the late 1970s. Hamilton was founded in 1845; the past 35 years are not a true representation of Hamilton’s historical economic picture. So perhaps the word “normalization” is a better way of looking at the changes. However, whatever you call it, this change impacts us deeply and it can no longer be ignored. The good: Revitalizing an area breathes new life into neighbourhoods and piques interest
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back into a city. It grows an economy with new investment, construction, small businesses and job opportunities. This opens up the market for larger industries to take a city like Hamilton seriously. The city benefits greatly from increased property taxes, tourism and national recognition. These are all positive changes in a city. In 2017, Hamilton sent in a bid for Amazon to establish their second headquarters here. They didn’t win the bid, but the fact that it was taken seriously speaks to where Hamilton can go. The new investors in Hamilton are eager to upgrade their properties and improve the aesthetics of their investments. This typically ignites interest from long-term residents to do the same to their properties. More attractive properties attract higher income residents who demand better amenities and can spend more on local businesses in the area. These revitalized areas have a lot at stake and the pressure to succeed is high. That’s how you get great neighbourhood vibes, like what’s happening on Locke Street in Hamilton. After the recent vandalism on Locke Street, the residents held a #LoveLockeDay as a way to rally support for the local businesses that were hit hard. The bad: On the flip side of growth there is loss. New developments are built over local favourite landmarks, with higher density, smaller lots, less green space and parking. However, at its core, the anti-gentrification argument is about displacement of people who have been priced out of their homes and neighbourhoods. The revitalization of an area stresses those residents who live there because the rents are no longer low and the local economy is no longer affordable. Once the revitalization happens in more areas across a city, these lower income residents have no place in their price bracket. Their choices include leaving the city entirely, getting assistance from the government (which they might already be on) or rising up against change. The ugly: Frustration and anger stem from fear; when you feel that you have no place to go with no solution to fit into the changing environment, you find someone to blame. Unfortunately, many times, the focus is on landlords who raise their rents or small businesses that charge higher prices for doughnuts. Activist groups feed off this type of fear and help those struggling with change to direct their anger in the wrong places. The recent attack on Locke Street in Hamilton is an example of extreme anti-gentrification activism. What is the real motive behind these types of groups? If they were looking for a solution, shouldn’t it be directed at better social assistance and higher pay? The idea that everything should cost less so that people can afford things seems short-sighted when the costs to produce everything continue to go up. The federal, provincial and municipal governments need to work together to ensure that nobody is left behind as we move forward to improve our cities and our society. The $4 billion Canada Housing Benefit, which would provide rent support for about 300,000 low-income households, is slotted to begin in 2020 (if the provinces cover half of the cost). This will go a long way toward helping to provide better assistance and helping those in need to embrace the improvements to their community.
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Bowling for Kids
Wednesday, March 23, 2018 6:00 – 8:00 pm The HDAA Charity team is raising funds for Big Brothers Big Sisters of Hamilton and Burlington. This is a fun night out with fellow HDAA members and you get to help the kids too.
Spring Hope Food Drive
Tuesday, April 17, 2018 6:00 – 8:00 pm What an easy way to give back to the community! Sign up your buildings, get your tenants involved and we will take care of the rest!
HDAA Trade Show
Location: Michaelangelo Conference Centre, 1555 Upper Ottawa Street, Hamilton, ON
Monday, April 23, 2018
Keynote speakers: 2:00 – 3:00 pm Trade show: 3:00 – 6:00 pm
Speakers: Kris Boyce, CEO, Greenwin Inc.; David Horwood, Director & Vice President – Residential, The Effort Trust Company; Scott Topping, Chief Operating Officer, Homestead Land Holdings Limited Visit www.hamiltonapartmentassociation.ca for a list of trade show exhibitors and to register for both events.
Hamilton and District Landlords Since 1960, the Hamilton and District Apartment Association has grown significantly. Our members manage over of 30,000 units throughout Hamilton, Burlington, Brantford, Guelph, Mississauga, Oakville, St. Catharines and into the Niagara Peninsula. The association is a highly respected organization, sought out regularly by government, industry, media and the public.
Interested? Call us or join online! Ph: 289-208-5445 Web: www.hamiltonapartmentassociation.ca
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Catch the final spin with RHB’s Newsreel, delivered weekly to your inbox.
Typography: Or as the cool kids say, WHAT THE FONT? By David Gargaro, in collaboration with Wendy Tabor, RHB Senior Designer
Although it’s often overlooked or the last factor considered when laying out a document, typography can greatly affect your marketing, and impact how clients view your business. Typography involves more than choosing Times New Roman or changing the font size from 10 to 12 point. Typography is defined as the visual appearance of printed matter. Various factors, including how type sits on your medium, font colours and using serif versus sans serif fonts, affect how your viewer perceives information.
Fonts are also a key element of typography. The right (or wrong) font can have a significant impact on the success rate of marketing your building to tenants. It is the vehicle that carries your content from chosen communication medium to your tenants’ memory. There are countless fonts to choose from, but they are not all created equal. Consider these tips when choosing fonts for your printed or online material: •
Not all fonts are licensed for print and web, so you have to ensure the font you use in print is also licensed for use on your website.
The reading experience and how we retain information is much different between fonts used in print and online. Web fonts can have more flexibility in height, width, shape and spacing.
2. Typography that is messy or unbalanced makes the information more difficult to digest, which means that viewers (potential tenants) will be less inclined to buy (rent) from you.
Using high-quality fonts, with extensible typefaces, can easily do the heavy lifting by creating a visual hierarchy – bold typefaces for headlines, regular/book typefaces for body copy, italics for captions, etc.
3. Humans are visual creatures, as 80 – 90% of the information we retain is visual. You only have a few seconds to grab the reader’s attention. With strong typography, you can more easily grasp the tenant’s attention and get your content (and building) to stick in their memory.
A strong visual hierarchy created by good font choice breaks content into digestible bits so potential tenants can quickly find the information they need to reach out to landlords and property managers.
So, why should you care about the typography you use on your website, newsletters, branding, sales and marketing materials, and your printed and online content? 1. Typography sets the tone for your brand on a psychological level.
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To see some of our favourite fonts, please go to: www.perpetualmediagroup.ca/tenbestfontsforprintandweb/
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