It has been 3 weeks since I gave an update. The reason being during the past 3 weeks, I was busy waiting for information and was overly stressed in dealing with the insurance company.
Let me tell everyone this, when you see commercials where the representative of insurance companies are caring and will take care of everything for you after you have suffer a large loss like death or fire, that is not what I have experience here.
In fact it is pretty much the contrary. They will drag their feet in processing the claims, pressure you in signing forms that you feel uncomfortable in signing, and finding ways in not paying the claim, that includes accusing you of setting the fire yourself and treating you like a criminal.
Anyhow, I do not think I can get into the particulars and details of the case here as the matters has been refer to my lawyers and they are dealing with the insurance company over the claims right now. But essentially, based on the evidence available, and after revisiting the scene of the fire, both the Fire Marshall and the Arson unit from the police does not think that the fire was deliberately set by anyone, and I'm not being charge by the police for being an arsonist. And both of them disagree with the findings of the so call "Cause and Origin" expert paid for by the insurance company. My lawyer pretty much told me that the insurance company can continue to fight, however, they will lose the case for sure as they can not establish a motive, a cause of fire and an opportunity where they can link me to the fire. And if they continue to do so, what they can be seen as dealing in "Bad Faith". Which means that they will not only have to pay for the claim, but they will also be looking at paying a punitive damage as they will lose the case for sure.
However, I can not say I'm completely out of the wood yet, as I have not yet heard back from my lawyer how the insurance company is reacting to what the Fire Marshall and the Arson unit investigator has to say with regards to the cause and origin of the fire.
When Karen Davis was facing life as a single parent in 1993, she wanted to have a home and an entry into the real estate market.
By purchasing a duplex on Castlefield Avenue near Yonge Street and Eglinton Avenue in Toronto, Ms. Davis, now 53 and an agent with Sutton Group Bayview Realty Inc., was able to live with her then five-year-old son Taylor near good schools, parks and shopping, while receiving help with her mortgage through rental income.
It has all worked out in textbook fashion: her investment has increased in value, and she's had, on the whole, great tenants.
"I purchased my property for $239,000 and today it would be worth $600,000," she says. "I had to spend $85,000 to make both halves livable and because I was living there I did things like a rubber slate floor, stainless steel appliances and fuchsia counter tops. Each unit is 1,100 square feet, with three bedrooms and one bathroom. Today, I have the property as an investment and live elsewhere: it will be my pension. I also manage a few income properties for some of my real estate clients."
Karen Davis bought this duplex ‘for completely practical reasons.’ (KATHY FLAXMAN FOR THE GLOBE AND MAIL)
Tina Canzanella, manager of residential mortgages with TD Canada Trust in Toronto, notes that in order to qualify for mortgage funding, the property has to carry itself. The lending institution will require a full rental analysis, including rents, repairs and other expenses and an allotment for vacancies. "We would likely be looking at financing about 65 per cent," she says. "If someone buys a home and plans to rent part of it, they could only use 50 per cent of the rental income as part of their income in qualifying for financing. We would want to see lease agreements and perhaps do an appraisal to get comparable rents in the area."
"It's very important to make sure the premises are legally conforming — that they have the necessary documents that prove they comply with such items as zoning and fire regulations," Mr. Drummond points out. "Purchasers will have to make sure there is a compliance certificate or a retrofit certificate, if necessary."
Ms. Davis agrees, and adds a further cautionary note. "I did not fall in love with my duplex," she points out. "I chose it for completely practical reasons. I recommend people do the same. Get a home inspection and make sure the major systems are what you expect. Budget for improvements and regular maintenance. And choose your tenants carefully!"
Tenants. The right ones can make owning a rental property almost a pleasure. The wrong ones? A nightmare.
Ms. Davis recalls one woman whose rent cheques bounced every month and who let garbage pile up in the stairwells until the other tenants thought there was a sewage problem. The crowning glory though, was the woman's German shepherd that made the back garden unusable.
"I showed up every morning and was in that woman's face about it," Ms. Davis recalls. "Fortunately she decided to move out. It cost me almost a thousand dollars just to have the unit cleaned and both the front and back gardens had to be resodded and landscaped. An expensive lesson."
Dave Harris has yet to encounter a tenant he didn't like in the two condominiums he owns and rents out. The first, a one-bedroom near Yonge Street and Davenport Road in Toronto, he manages himself, the other, a two-bedroom unit in Scarborough is run by a management company. His tale is not entirely serendipitous though.
"I had paid off a large mortgage on my house and wanted the forced savings of an investment," he says. "I bought at the top of the condo market in 1989 and saw the value of my properties fall dramatically, down by half in 1994. Now they are back to where they were. The condo market doesn't seem to appreciate as fast as the rest of the housing market."
Bad tenants? How about no tenants
All landlords talk about the fear of having to get rid of a bad tenant. From some owners' point of view, laws like Ontario's Residential Tenancies Act are skewed towards the tenants. Bob Aaron, president of the Ontario Multiple Dwelling Standards Association, points out that there are such creatures as professional tenants who make a practice of not paying rent. Eviction can be difficult and time consuming. "If the issue is non-payment of rent, the tenant may pay just before the final deadline and then the process begins all over again," he says.
No matter what, it is likely to take months and months to evict a bad tenant, with paperwork and appeals and other requirements such as having the sheriff carry out an actual eviction. But that is not the biggest problem faced by landlords today: scarcity of tenants. In a real estate market with its tasty low interest rates, people are buying their own homes, often condos, and owners of rental units are having to scramble. "In the late 1990s it was hard to get an apartment," Ms. Davis says. "I would get 60 applications for one unit. Now that would never happen. Good tenants are worth hanging onto."
Nevertheless, it's essential to be extremely cautious in choosing tenants. Credit checks, references from previous landlords and personal references are musts. Mr. Aaron suggests that property owners work with a team, including real estate agent, financial institution, accountant and lawyer.
"People buy rental property for different reasons," Mr. Drummond says. "There is some risk in real estate. About 20 to 25 per cent of our business is in rental or investment properties. This is a popular option."
