Hello fellow real estate freaks.

I have a dilemma and am in search of some help and guidance from my fellow investors.
Next week I stand in front of city council (city of Saskatoon) and must explain to them why and how condo conversions will help their city.

They have put a stop to conversions because the city has a 0.6% vacancy rate and they don't want loss of "affordable housing".
They fail to mention they haven't built any government subsidized housing in 40 years.

My main arguments are that :
A) I'm not responsible for funding any sort of government housing projects so why should i be punished because of the lack of planning from the city.
B) condo conversions will revitalize broken and beaten up buildings in tough neighbourhoods.
C) most of the condos when completed will be bought by out of town investors and will still be in the rental pool. Not as apartments but as beautiful newly renovated condos.


Can anyone please help me with some more good points.
I need to show that the pros outweigh the cons when doing a condo conversion.

Any help would be greatly appreciated,
Thank you

-Emil

Well....I am not so sure I would use point #1. The government never cares about you individually, their job is to look after the community as a whole.

You need to focus on that you are creating affordable owner occupied housing. By restricting conversions they are reducing the inventory of affordable homes for the cities residents to achieve home ownership. By restricting the conversions they are artificially inflating the home values and increasing the cost of living for all homeowners.

Based on local tax code this one might or might not fly: By converting to condos the city will have more tax revenue. This increased tax revenue can be used to offer subsidies to builders to build new low affordable housing. This will increase the overall housing capacity of the entire city.

Next you need to show that by removing XX number of rental units that your overall effect on the rental market is only .00x%. One conversion normally isn't going to make that large of a difference to a cities overall rental makeup. They can approve projects as they are submitted and keep control over the entire process.

We have had to fight in the past for a conversion to get approved and it ended up not being worth it in the end. We should have walked away and found a new building in another town. Unless you see huge profit potential you might be pushing forward on something that just isn't worth it.

Good luck.

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My thoughts on the Sarasota Association of REALTORS actions.

You are right, you should not be burdened in such a way, but they see voters, not logic.

First step in this long battle is to raise rents. If the vacany rate is that low the rents are too low. Such a rate means that the minute one becomes available it is snapped up. Having a unit sit vacant for two weeks is not the end of the world.

I just love government types who tell the citizens that they must pick up the tab for somebody else.

If you convert the condos to affordable housing (or at least some portion of them) then you can tout the development as moving the low/middle income folks to ownership rather than renting. Government loves people who own and are docile (hence the tax breaks for mortgage interest and tax breaks for having kids ) Another tactic, depending on your size/knowledge could be offering to develop some other projects that would be affordable. I've been a partner or involved in 8 condo conversions here in Austin and they have been both good investments and good for the community. One aspect of site selection is to try pick places that are eyesores or have very troubled residents. i.e. cops are always there and neighbors/city are glad to see you come in and clean the place up.

Joe

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Austin Texas Real Estate | Coldwell Banker Austin | Austin Texas Real Estate

I think ken smith hit the nail on the head. Emphasize how you are creating opportunities for affordable housing and giving first time home buyers (former renters) the chance to become home owners.

It has been found that high rates of home ownership benefit the community via lower crime, stronger tax base.

There are some good quotes in this study by NAR.

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Milan Cole, Real Estate Broker
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(503) 953-3416