Doon neighbourhood girds for annual student onslaught

By  Catherine Thompson

KITCHENER — A walk through the Lower Doon neighbourhood is a study in contrasts: in the space of one block, there are well-kept homes with tidy lawns and attractive gardens. Next to them though, are houses, or even clusters of houses, where garbage bins stay out all week, where weeds have overwhelmed lawns, where front yards have been almost fully paved over and driveways are clogged with cars.

A short walk from Conestoga College, “For rent” signs stud most lawns on Amherst Drive, where the garages on at least a dozen homes have been turned into bedrooms.

Although the larger Northdale student neighbourhood in Waterloo has attracted more attention, the Kitchener neighbourhood closest to Conestoga College has seen its own radical transformation over the past decade.

And as September approaches, city officials and residents alike are gearing up for another influx of students in south Kitchener.

Conestoga College has boomed in recent years. More than 11,000 full-time students are enrolled for September, up 50 per cent from six years ago.

Most of those students live in what were once single family homes, which have been sold to landlords who put in extra bedrooms they rent to students for upwards of $500 a month.

Tom Ruggle, Kitchener Fire Department’s chief fire prevention officer, estimates there are 150-170 homes in the area that have been converted to accommodate students, often with as many as six or eight bedrooms per house.

The large annual influx of transitory, young tenants has transformed the neighbourhood, say longtime residents.

The streets are often clogged with cars, especially in winter. Parties are noisy and frequent, and students have been known to haul dilapidated couches onto porch roofs for an open-air perch.

Resident Bill Harris has endured next-door neighbours urinating on his hedge in full daylight, loud and drunken swearing, drinking parties in the garage and even the occasional indecent exposure.

Residents point to former “showpiece” houses that were known for fine displays of Christmas decorations, now looking rundown with weed-filled yards. Where roses once bloomed, metre-high weeds flourish.

“There’s deep history entrenched in this area,” says Danuta Akudowicz of the neighbourhood. “It’s a unique piece of ground and it’s being trashed.

“I’m very angry. We’ve been here 33 years and we see this area getting progressively worse and worse and worse.”

They’d love to see Kitchener introduce a rental housing bylaw such as the one Waterloo introduced in April 2012. It compels landlords to pay a licensing fee, limits rentals to four bedrooms per unit and regulates room sizes among other things.

Kitchener council rejected that idea last June, after city staff said drafting the bylaw could eat up two years of staff time. It opted instead to watch how such bylaws play out in other cities, and to step up enforcement.

But city officials say their ability to regulate such housing has been sharply curbed by recent court and human rights rulings that prohibit targeting specific groups such as low-income people or students, and prohibit the definition of a household based on numbers of related people.

The Kitchener Fire Department started up a program encouraging landlords to have higher safety standards for fire separation, fire detection and extinguishers, Ruggle said. Unfortunately, he estimates only about one-quarter of all landlords in the area participate.

“We have a general concern for the safety in the area,” Ruggle said. “The homes weren’t designed to accommodate those numbers of people.”

Fire officials knock on doors every fall to ensure homes are equipped with working smoke alarms, Ruggle said, but can’t do much beyond that in homes still classed as single detached homes. Overall, officers found most homes to be reasonably safe, he said.

The city has stepped up its bylaw enforcement, and has two bylaw officers — one for parking and one for property standards — assigned to the area every weekday, as well as a third officer to investigate noise infractions from Thursday to Saturday, said Gloria MacNeil, Kitchener’s supervisor of enforcement. It’s the only area in the city where bylaw officers are out looking for violations, rather than simply responding to complaints, she said.

“If there’s a party, it’s zero tolerance: they get ticketed,” MacNeil said.

Conestoga College wants to be a good community citizen, but president John Tibbits says there’s a limit to what the college can do. “We don’t own the housing, and we don’t set the bylaws,” he said.

The college’s own residences accommodate about 500 students, but demand for those spots is limited. It makes no sense to build more on-campus residences when there is no demand for more, he said.

The reality, Tibbits says, is that students are adults, and most prefer to live on their own rather than in a residence, with its more restrictive rules on visitors and curfews.

“It’s not as simple as we’ll build all kinds of residences and they’ll come,” Tibbits said.

Some relief might come from recent developer interest in building highrise apartments in the area, which would be designed to accommodate large numbers of people with less impact on the surrounding neighbourhood.

Residents fear their neighbourhood is sliding irreversibly into becoming a student ghetto. “We no longer have a balanced population here,” said Roman Szydlowski.

“It’s a beautiful area,” agreed Peter Jamieson. “It’s going downhill. What is it going to look like in a couple of years?”

Ruggle sympathizes. “Unfortunately, it’s the residents in close proximity to the college that are bearing the brunt of this,” he said.

He believes the neighbourhood has already reached “that tipping point” and that it would be difficult if not impossible for the area to revert to what it once was. “The controls that are currently in place really haven’t had any tangible effect on turning the tide.”

Converting a house and renting it out to a ready market “is a very lucrative business,” he noted.

Coun. Yvonne Fernandes, who represents the area on council, is determined to keep pressing for change. “We have to keep this issue in the eyes of the municipal government and the provincial government.”

“The students have rights and the landlords have rights,” says Akudowicz. “What about our rights?”

 

Source: http://www.therecord.com/news-story/4727872-doon-neighbourhood-girds-for-annual-student-onslaught/ 

Can Waterloo Support the Student Housing Boom?

If you have driven down Columbia, King, Ezra, or Bricker st. lately (to name only a few), I am sure you will have noticed the transformation that the Waterloo cityscape is undergoing.  Large multi unit student buildings are popping up all over.

If you are like me, I am sure you have wondered to yourself can the student population support such a massive influx of student accomodation?

I decided to do a little research.

University enrollment across the province is on the rise. According to the Council of Ontario Universities enrollment has increased steadily from 2000-2001 academic year to at least the 2009-2010 academic year. Between 2008-2009 and 2009-2010 undergraduate full time enrollment in all Ontario Universities increased from 352,945 to 367,615 or 4.2%.  Graduate full time enrollment increased from 48,370 to 51,041 or 5.5%..

Waterloo Universities are no exception to this trend, According to the Student Accommodation Study Monitoring Report prepared by MMM Group Ltd for the City of Waterloo it is anticipated that there will be an extra 1000 students coming to the city each year, with about 700-860 new students that will require off-campus housing each year.

Click here to view a table showing past and projected enrollment for both Waterloo Universities.  (excerpt from the Student Accommodation Study)

So there is a demand.  But is it really big enough to support the construction explosion we have witnessed over the last few years?  What did the students do before?

The Student Accommodation Study also took a look at apartment construction and proposals in and around the universities from the period between 2008-2011. During this time apartment construction and proposals  amounted to more than 19,825 new beds potentially* being brought to the market.  Click the link to view the stats from the study-Student Buildings New Construction

The study also found that student lodging houses account for another 6209 beds. (click here Student Lodging Houses)

So if we take the total number of beds from lodging houses and  new apartments we end up with  26,034 available beds.  When we compare this to the estimated demand  for off campus housing for 2012 of 25,729, we can see that there is more availability than demand.

It should be pointed out that many of the new construction beds are not yet finished so these numbers are somewhat skewed.  The stats above also do not account for other forms of off campus student accommodation such as Class A & B rentals, or staying with family members.

So what does this all mean?

It appears to me that there is (or will be) more inventory than demand. Yes we are seeing an increase of approx 700-860 students per year but looking at the construction going on throughout the city- it appears to be outpacing the need.  There is no doubt that the new rental bylaws introduced in the City of Waterloo will have a large impact on driving students out of single family homes and smaller rental units and into larger multi student dwellings like these but in the end when there is more inventory than demand this inevitably drives rental prices down.

The big loser will be the small investor.  The new rental bylaws have created a paperwork nightmare and added substantial dollars to the average investors bottom line through application fees, inspections etc.  I understand its purpose- many rentals were not safe and too many students were being crammed  into small homes- placing pressure on the cities infrastructure and  deteriorating once desirable  neighbourhoods

I think lodging houses will begin to find it difficult to compete with their newer mutil unit counterparts that often have the added bonus of location and amenities to offer to potential renters.

Despite the smaller single detached rentals losing ground I feel there will always be a niche for single detached homes in the unversity rental market- after all who will hold the parties?

For more information on this topic and for estimates of typical bedroom rents see link below:

http://www.thecord.ca/?p=11733

We are always interested in your feedback and comments.

 

 

 

 

 

5 Advantages and Disadvantages of Student Rental Properties

We often have investors come to us and ask which is better; student investment properties, multi unit buildings or single family properties.  Our answer is always the same- it really depends on the individual investor.  Each has its own advantages and disadvantges.  Below  we outline 5 Advantages and Disadvntages of Student Rental Properties.

5 Advantages of Student Rental Properties

1Increased Income–  student rental properties are often rented by the bedroom.  This greatly increases the potential income of a property.  For example in Waterloo you can typically get  on average around $500 per bedroom (depending on proximity to the school and condition).  Therefore a 4 bedroom house has the potential to generate $2000 in gross monthly income.  This far exceeds the average rent for your typical single family four bedroom home.  Important to note there are new Rental Bylaws in Waterloo that can impact the abilty to rent a single family home-  for more info please read post titled “Waterloo Rental Bylaws”

2. Parent Guarantors– in most cases you can get students to sign parent guarantor forms.  If the student is in arrears for rent you can go after the parents.  This provides an extra level of safety from rent delinquency.

3. Low Vacancy rates– each year there is a steady supply of new students attending the local schools.  It is estimated that the student population in Waterloo is increasing approx 1000 student per year.  For more info on student population see post titled “Can Waterloo support the Student Housing Boom?”

4.  Less Knowledgeable Renters– typically students are not as knowledgable on Rental Legislation and the Landlord Tenant Act.  This helps to avoid costly “professional tenants” who can take advantage of landlords costing them many months in lost revenues.

5. No pets, Non-smokers, No Kids– student renters rarely have pets and are far less likely to smoke than your average renter for single family homes.  This results in less damage to your property- these are three very common problems when renting single family properties

 

5 Disadvantages to Student Rental Properties

1. Higher Turnover– there is often a higher turnover rate with student rentals.  Sometimes you will get lucky and have a tenant stay for their entire undergrad degree but in most cases things change- they may change schools, drop out, a friendship with a roomate might dissolve.  This results in more time trying to market/find/screen new tenants.

2.  Increased Managentment/Maintenance Costs– along with the increased turn-over in our experiece there is increased management and maintenace costs.  Remember most if not all students have never lived on their own.  Their parents are no longer there to help them with routine maintenace items-that now fall on the landlord.  We have recieved calls for basic things like changing light bulbs, removing hair from clogged drains and even flipping breakers.   Your typical single family renter can usually manage these types of things on their own.

3. Wear and Tear– Parties!  We all know that a big part of University life is partying.  This can have signifcant wear and tear on your property.  Many of our investor cleints do regular inspections to ensure the propery in being well maintained and any damages are addressed immediately.

4. Subletting -many students go home for the summer and typically want to sublet to another tenant for these months- a landlord or Investor does their due diligence and screening process on the initial tenant but a subletter is sreened by someone else.  This can present problems for the landlord.

5.  Location-location is key for student rentals.  Students prefer to be within walking distance to schools or on a transit route. It is also vital that students have acess to amenities such as shopping (groceries) gyms, nightlife etc.  These factors will all come into play when a student is considering a rental property.  This dramatically impacts the available inventory when looking to purchase a student rental.  Be mindful of this when looking at potential properties.

As we said above every investment property has its own advantages and disadvantages.  It really comes down to the individual investors needs.  For example if you are retired and have plently of time on your hands than a student rental might be a good fit becuase you can manage the proeprty and address any maintenance items yourself- if you have a larger portfolio and have the needed cashflow than professional management might be a good option to combat some of the disadvantges in student rentals.