September 24, 2021

La Ronge Northerner

Complete Canadian News World

Real Estate: “Affordable” condos for doctors and investors

While many Montreallers find it difficult to find a home at a good price, hundreds of “affordable” units are rented and sold at exorbitant prices, sometimes by relatives of advertisers, our intelligence office has found.

For 15 years, the city of Montreal has encouraged developers to include 15 to 20% of affordable housing in their projects, allowing less affluent people access to housing rights.

The city sets the maximum price per unit. For example, a two-bedroom condo costs $ 280,000.

But the spirit of this project is easy to avoid, as we have discovered by analyzing thousands of real estate transactions.

For example, a medical professional rented two studios this spring and he was able to get them at a very low price.

Rent is charged for these 273 square feet of units, described in its advertisement as “luxury floor”? Nine hundred dollars a month.

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We have listed several similar cases:

  • Dozens of investors have bought more than one affordable home, with one couple even owning six.
  • About sixty foreign buyers have bought the units, mostly Chinese.
  • Relatives of real estate brokers and developers were able to get many condos at low prices.
  • In all plans without exception, affordable units are rented at prices beyond the affordable range.

While these practices are not illegal, they do cost less roofs for less affluent people.

According to Stephen Cote, head of the large project division at Gogir and founder of DevMcGill, it is not the role of real estate developers to “disqualify or disqualify” people from buying affordable units.

“Anyone can buy it. It has not been managed,” he stressed.

On the city side, no verification was made other than the initial selling price.

Buyer’s profile [incluant sa nationalité] It has no bearing on whether the unit meets the criteria for affordable housing, ”said city spokeswoman Carla Duval.

The market is fast

Often purchased by investors, the units are quickly rented out or resold at a higher price.

For example, in the Square Kids program, three studios that were sold cheap in July were listed for rent above $ 1,000 a month a few days later.

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Housing no longer has to be affordable, even if it is not for rent.

For example, at the Amati Tower in Griffindown, a pair of Montreal investors bought six cheap non-mortgage units last fall. He sold two months after four months and made a 50% profit.

Since 2014, one of the five units purchased at the price established by Content Strategy has been resold.

We calculated that their prices increased by an average of 38%, while the prices of other houses located in the same real estate projects increased by only 25%.

In resale, affordable units have the potential to return to average [des prix du marché] That’s a lot of value, ”says Stephen Cote.

– With Charles Mehti

2020

The maximum amount for a residence should qualify at an affordable price

  • Studio: $ 200,000
  • Room: $ 250,000
  • Two rooms: 280 000 $
  • Three bedrooms (96 m2 At least): 360 000 $
  • Project: Noka Condos
  • Developer: DevMcGill / TGTA
  • Number of affordable units: 48
  • Units purchased by the Chinese: 15

The Noka Condos Tower in Griffintown was built in 2011 on land sold by the federal government for $ 6 million.

One-third of the affordable cost of the project was purchased by primary residents in China.

In addition, the founder of DevMcGill, Stephen Cote, bought three cheap condos with his confidence.

“I have three children. I bought units for them. They are small children. When they go to university, I will change them so they can live there,” Mr Cote notes.

In the meantime, he provided these units and rented them out. “I think it really fits the spirit of the project,” Cote says. They are going to get housing and it is a good way to start life. “

  • Project: Ateliers Castelnau
  • Developer: DevMcGill / TGTA
  • Number of affordable housing units: 33

Located near Jarry Park in Ville County, the condo project has at least four affordable studios rented for over $ 900 a month. Units are less than 300 square feet.

By the standards of the city of Montreal, the rent should not exceed $ 705 per month for these studios to be considered affordable.

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The two condos were owned by a medical radiologist, each purchased for about $ 164,000. When the real estate broker bought them “for rent to customers,” he knew his client had affordable units.

  • Project: Idevco Fabre
  • Advertiser: Ideco
  • Number of affordable units: 4

In order to get permission to demolish a church to build about twenty condo, Ideco contracted with the city of Rosemond to add four affordable units.

Sylvie Duff, an Ideco partner through a series of companies, bought one of these two bedroom units in February 2020 for $ 280,000, the maximum door set by the city.

MMe Duff, the wife of Ideco’s vice president Alain Richer, sold her condo in October 2020 for $ 480,000. MMe Duff declined to comment on his transactions.

The two children of Idevco president Jean-Pietrias own two condoms at an affordable price. One of them was rented last April for $ 2000 / month.

For many of our calls Mr. Boud Trias did not respond.

The fourth affordable unit was acquired by a construction contractor and later sold for $ 490,000 a year later.

  • Project: District Griffin
  • Developer: Devimco
  • Number of Guaranteed Affordable Units: 107 (Phases 2 and 3)

In 2017, our intelligence unit removed the stamp on real estate investments by Ibrahim Hissein Bourma, brother-in-law of former Chad dictator Idris Debbie.

Mr Purma was arrested at Cairo airport with 199,000 euros already hidden in his suitcase. He owns several million dollars in Montreal, owned by Investment Siham Canada.

In particular, he bought 10 non-mortgage condos at the Exaldo tower, three of which are considered “affordable”.

One of these units, a studio with a wall bed, was advertised for rent in June for $ 1,250 / month.

Laughter cannot be suppressed when we say that this studio, which is managed for rent by Carlo Cabrera, the real estate manager of Trustcon, is an affordable unit.

“I can’t pay for it myself,” he says.

  • Project: Westbury
  • Developer: Devmond
  • Number of Guaranteed Affordable Units: 87

In the Westbury project, in C -te d’Ivoire, many units sold in 2020 below the affordable limit established by the city have already been leased for more than $ 1,000 a month.

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At the end of June, the 500-square-foot unit was advertised as $ 1,300 per month.

According to land registration documents, the owners live in Chengdu, the capital of Sichuan Province, China.

Their real estate broker, Miao Hoo, said they did not know it was an affordable unit. “It wasn’t written in the contract,” he says.

MMe Hu says the owners got a discount from the developer “because the family bought too many condos” to go to Montreal.

“Scary”, recognizes the city

Valerie Blonde, the person in charge of the home under the administration of Robert Futrey, deserves to be “terrified” of the circumstances our intelligence office reveals.

“It’s hard to swallow. We see that the strategies for avoiding adding are different. This is an issue we recognize,” he notes.

The number of situations in which we have raised concern units in the number of 1,290 private affordable housing units perceived since Valerie Plant came to power in 2017.

However, Mr. Futri believes this will not obscure the home record.

“Most affordable units meet affordable requirements,” he said.

New control

This is called his review of the strategy involved Robert Futre Terms for mixed metropolis, And coming into force in April, will prevent future abuse.

“There will be close follow-up to ensure the buyer’s eligibility and plans are not in place,” he says.

Capital gains from resale of affordable assets will also be limited to 3% per annum.

However, the developers suspect that the regulation will be tight, according to the city.

After all, hundreds of affordable housing units are still under construction under the old rules, meaning only $ 10,000 per unit that is not controlled by buyers and not realized or sold above the price set by the city.

“We respect the old agreements. Changing the rules of the game at the end of the curriculum would probably have undermined many of the plans,” said Robert Futrey.