Thursday, January 12, 2017

Your rental property can be seized as Proceeds of Drug Money Laundering

Here is the situation;

Couple owns a few rental properties that they rent to [second chance] ex cons, people down on their luck, homeless people trying to re establish themselves, low income housing.

Police decide that rent payments made to the Landlord in cash must be the proceeds of crime since the only form of income for the tenant is dealing drugs.

This very scenario is playing out right now in the Ontario Courts under the Civil Forfeiture Act.  

Here are the details in Broad strokes;

Margaret and Terry Reilly are from Orillia, Ontario. The Reilly's own several rental properties, some of which are former single-family homes that they have converted into rooming houses for low-income tenants. Margaret has been involved in alleviating poverty and homelessness since her father became the priest at an inner-city Anglican church in Toronto and opened a youth hostel there, while Terry has served on the City of Orillia Homeless Committee. Providing housing to marginalized members of society has always been a deliberate choice for the Reilly's.In 2008, after police surveillance confirmed drug activity at two of the Reilly's rental properties, a branch of the government called the Director of Asset Management took control of them. Since then, the properties have languished largely unoccupied, falling into progressively worse repair. Stripped of their rights as landlords, the Reillys had no choice but to watch their properties deteriorate physically and depreciate in value. Then, in 2012, the Government of Ontario brought a motion to permanently seize and sell the properties on the grounds that some of the tenants’ rents may have been paid, in part, with the proceeds of their drug activity. There is no evidence that any funds paid by tenants was derived from drug money; the state merely assumed that cash payments must have come from the proceeds of illegal activity. http://theccf.ca/r-v-reilly-civil-forfeiture/ 

This property(S) were seized under the Forfeiture Act without anyone being charged.
This family has NEVER had their day in court but had their property taken away.

The lesson here is monitor your tenant activity; visit twice of more time per year to ascertain the activity in YOUR PROPERTY.   Be more diligent in your tenant screening. Bad things can happen to good people. 

#ASKPYLYP

Use a realtor to screen tenants in your rental condos.

Ready to invest?   If  I haven't scared you call me at 647 218 2414
http://Davidpylyp.com 

Thursday, January 5, 2017

Will Title Insurance cover a hidden defect?

How could insurance cover a Hidden [latent] defect?

By its very nature, it is something hidden.

Not so fast .....


the case revolves around Paul and Stefanie Macdonald who bought a home in the city that they believed had been poorly renovated by its previous owner. When they attempted to undertake renovations of their own, they found that load-bearing walls had been taken out without building permits – making the second floor unsafe for use. This prompted the city of Toronto to issue a work order to support the unsafe floors with the Macdonalds paying out $75,000. They made a claim to Chicago Title on their insurance policy to cover these costs because the policy was said to provide coverage if the title was unmarketable. However, the claim was denied as the company stated that it was not covered under the policy.
This, in turn, prompted court action beginning in 2014, with the judge ruling that the municipal work order resulted from a hidden defect that was not covered under the policy. It stated that the work order did not affect “ownership of the land” as it was not registered on the property title – even though work orders are never registered against the title.
http://www.insurancebusiness.ca/ca/news/breaking-news/huge-title-insurance-case-reaches-conclusion-217419.aspx

 It was last year that the decision was reversed with the insurer ordered to pay more than $50,000 in costs with the ruling suggesting the hidden defect made the title unmarketable. Now an appeal by the insurer has been dismissed and the ruling upheld.


So  what's the conclusion?

The situation will be taken under advisement and studied by the Industry.   I am sure if you are in the situation to sue; you now have case law in your favour.


Do you check the insurance claims history of a house before you buy? 
You can actually    With a Home Verified Report
http://eleganthomesinwesttoronto.blogspot.ca/2013/07/did-you-buy-house-with-flood-damage.html

#AskPylyp   Work with an experienced agent.

Call me   Let's talk 

Wednesday, December 28, 2016

INSIGHTS to the condo market - Toronto 2017

Urbanation recently polled Builders to ascertain the level of FOREIGN OWNERSHIP in the Toronto Condominium Market


The results of a survey conducted by Urbanation Inc. indicate that the majority (52%) of buyers of new condominium units in the Greater Toronto Area are being purchased by investors who do not intend to occupy their units and that only about 5% of new units are being purchased by foreign buyers (i.e. buyers whose primary residence is outside of Canada). The survey was conducted among developers of condominium projects being developed in the 3rd quarter of 2016 (projects in the pre-construction and construction stages and recently completed projects). Urbanation Inc. is a research company that has been analyzing the Toronto condominium market since 1981.The results of the Urbanation survey are consistent with the findings set out in the Canada Mortgage and Housing Corporation (“CMHC”) November, 2016 report, Housing Market Insight Canada – Foreign Ownership. The CMHC report indicates that foreign ownership of condominiums in the Toronto Census Metropolitan Area in 2016 was 2.3%, with the greatest concentration of foreign ownership in new condominiums and condominiums with more than 500 units.There has been considerable speculation as to whether the Government of Ontario will introduce a tax on foreign buyers, as was done in British Columbia. Since the results of the surveys conducted by both Urbanation and CMHC indicate that only a small percentage of units are being purchased by foreign buyers, this would seem to suggest that there is no need for a foreign buyers tax.Another survey conducted by Urbanation indicated that the supply of condominium units in the Greater Toronto Area listed as available for rent dropped by 13% in the 3rd quarter of 2016.“Market conditions became very tight in the third quarter with the average condo rental spanning only 12 days on the market and the number of units renting for above asking price more than doubling from a year ago.”These findings are consistent with recent findings of the Toronto Real Estate Board, which indicated that rental rates for condominium units had escalated considerably due to the fact that there were fewer new condominium projects being completed in the third quarter.With the hot real estate market in the GTA it will be interesting to see what happens in 2017.

Many are looking at these results in light of BC's additional tax of $150,000 per property in Vancouver and Toronto's eyeing Revenue Tools ( additional Taxes )

Do you think we need a Toronto Condo Tax on Foreign Owners?

How do we decide who is a foreigner?
Are they a Student?

Are the Landed Immigrant or Permanent Resident?

What's the best way to see a condo unit?

Matterport of course


http://Bit.ly/CondoTour


List your condo?