St. John Newbrunswick

[drhowey]

Hello,

I am just wondering if anyone has any information on investing in St. John, Newbrunswick? I attended a seminar recently where a realtor spoke about all of the positives about St. John; low housing prices, vacany rates, many new projects and hence there will be new jobs.

It all sounds great. Does anyone have any additional information? I am a new investor and a little nervous about not getting all the facts.

Thanks very much,
Debbie H.

 

[Noel]

QUOTE (drhowey @ Nov 26 2008, 03:57 PM) Hello,

I am just wondering if anyone has any information on investing in St. John, Newbrunswick? I attended a seminar recently where a realtor spoke about all of the positives about St. John; low housing prices, vacany rates, many new projects and hence there will be new jobs.

It all sounds great. Does anyone have any additional information? I am a new investor and a little nervous about not getting all the facts.

Thanks very much,
Debbie H.


It`s understandable to feel a little nervous.

You might wanna check out CMHC. They have just released their latest stats and analysis on the area. http://www.cmhc-schl.gc.ca/en/

 

[Jack]

QUOTE I am just wondering if anyone has any information on investing in St. John, Newbrunswick? I attended a seminar recently where a realtor spoke about all of the positives about St. John; low housing prices, vacany rates, many new projects and hence there will be new jobs.

As of 2Q08, they`ve lost 206 people for the year, which is the worst net-migration figure for all of the maritimes. Housing prices are relatively low, sure, but unemployment is relatively high. Earnings figures for the province are pretty good, so it`s definitely an affordable place for residents to live and purchase their own real estate; that said, from an investment point of view, what should this fact, in theory, do to the vacancy rate? If people can fairly easily afford their own properties, why rent?

Did this realtor give any more information about the types of new projects and resultant jobs headed to the region? I know that there`s about $2.2B headed to Newfoundland for some type of mining venture, that will create a lot of jobs for the next 2 - 3 years and beyond, but I haven`t really heard much about New Brunswick.

 

[drhowey]

Thanks for the website, I will check it out. The information given from the realtor was that there are $20 billion in capital projects planned, a growing offshore oil market and a nuclear power expansion. Projects include the refurbishment of the Point Lepreau nuclear facility, the development of a potash mine near Sussex, and construction of the Canaport liquid natural gas terminal, and associated Brunswick pipeline. A second nuclear facility and a new oil refinery in Saint John are projected to start next year. He indicated that the resource projects, should they all proceed (!), could create 33,000 jobs over a 10-year period and would result in high demand for supplies and services.

Debbie H.

 

[Dan_Eisenhauer]

New Brunswick has revised its tax policies recently and become much more business friendly. I have not followed population trends in the Maritimes closely for a few years. But, I can say that the NB business climate is good.

There are numerous things that are happening around Saint John and Moncton that suggest you should take a serious look at investing there. I mean that in a positive way. Debbie has mentioned many of them.

 

[kanabel]

QUOTE (drhowey @ Nov 26 2008, 02:57 PM) Hello,

I am just wondering if anyone has any information on investing in St. John, Newbrunswick? I attended a seminar recently where a realtor spoke about all of the positives about St. John; low housing prices, vacany rates, many new projects and hence there will be new jobs.

It all sounds great. Does anyone have any additional information? I am a new investor and a little nervous about not getting all the facts.

Thanks very much,
Debbie H.

Hi all!

I have invested in Saint John at beginning of this year purchasing my first two rentals ever, triplex for $90k and fourplex for $150k, after doing my own analysis with goldmine score card. Cap rates on those were 13% and 10% respectively. All these projects were due to start as you`ve said but now stalled as much as in Upgrader Valley. They call SJ as energy hub for Atlantic. There should be also highway being built to connect with Bangor in Maine. Prices did go up a bit, but not much. It`s anticipated that 2010 will be breakthrough year as second refinery should come to life. City is getting new malls (on east end with Starbucks

)As read, NB disposable income should be right after SK and AB. Vacancy rate is continously going down, from 5.6% (CMHC) to 4.8% this year, and is the lowest now in all NB three major towns. Some of my tenants moved from Ontario and Quebec for jobs, on pipeline work and LNG natural gas terminal (built this year). Rents also went up 10-15% (after bieng flat for many years). There is lots of positives and enthuiasm in SJ. However, not sure how will coming economic crisis affect the area, but so far no drop in prices. Other pro is not restrictive Tenancy Law. City bought harbourfront land and wants to revitalize, and is pro-business, as well.
I am doing well on second property while having lots of trouble with first one. As a rookie investor without enough EDUCATION and EXPERIENCE I did a lot of mistakes that now cost me fortune. There comes cons as you have to be VERY, VERY careful when inspecting and choosing property since Saint John is the oldest city in Canada and most of properties are really old and hold big potential problems and expenses with it. Hire two inspectors. Be aware of the areas. There is mixture of good and bad right beside, and if you choose bad you are very likely heading for high vacancy or too much troubles with tenants. Either one will destroy you. Leases are usually month to month which makes you a bit uneasy about long term tenants (one full month damage deposit allowed). Pick unit with electric heating rather than oil (very few have natural gas), since you don`t wanna pay those bills for tenants. Hard to find impeccable PM. I had to change few. And if you are not local don`r trust too much realtor, ALWAYS do your homework, don`t assume, it`s a bit different mindset there than here in Alberta. My three cents on Saint John.
Cheers

Dejan

 

[invst4profit]

As with any area it boils down to doing your own due diligence. Do not take at face value the opinion of someone trying to sell you something (realtors) unless you have a very good business relationship with that person. Your final decision, regardless of the area, should depend on finding a property that will provide positive cash flow immediately especially in these tough times.
This is of course based on a individual investing where they live. If you are not investing in your area or province that is beyond my experience and comfort zone.
If you feel good about the area start making offers. Lots of offers.
Generally I make offers based on 100% financing, expenses at 50% and a cash flow of $100. per door minimum.

 

[Jack]

QUOTE As read, NB disposable income should be right after SK and AB.

Just released this morning, NB finished second in Canada in terms of YOY wage increases for the month of September.

1) Alberta - 5.9%
2) New Brunswick - 4.3%
3) Saskatchewan - 4.1%

 

[drhowey]

Thanks everyone for all of the great input. It has been very helpful.

Debbie

 

[JasonEtheridge]

I ve been looking thru older posts and was wondering who is currently investing in St.John, NB and what results are they having?

 

[jkcomm]

Hi Jason,

I haven`t invested anything myself in Saint John yet but have been paying very close attention to that city. What drew my attention was the overall prices vs. monthly rent. I have been looking at duplexes, triplexes & fourplexes.

From a pure cash flow perspective, there are lots of properties to choose from. Saint John has potential and RE prices are not over-inflated.

My 0.02 on the subject.

James

 

[Avoidconfusion]

I started investing In Saint John NB back in 2007. I have 6 individual properties, 4 apartment condos and 2 townhouses.
Here is what I have experienced so far.
1. The properties I have purchased have increased by over 15% per year. I will probably not see that return next year as the economy has cooled a bit there.
2. I found a very Realtor by the name of Dave Allen with Royal Lepage. I would recommend him, he know the ugly parts of the city and wiil give you straight answers and send you pictures. I have used the cover letter with him. Here is his email [email protected]
3. I have found a very good property management company called Peace of Mind Management. They are good here is their website http://www.pomm.ca/contact_us
3. I would recommend property insepections. I used Amerispec, they were good, there might be others that are good. The main thing with inspections would be oil heating systems and the electrical. The older properties could have knob and tube and sometimes they only replace the panel and the main wires and leave some of the old system in place, I backed out of a property like this.
4. Property taxes are not fair towards to lanlords, they basically like to double the property tax on non owner occcupied property. Make sure put that into your costs.
5. You will have to pay sewer they don`t let renters pay this, not sure why. They send you a bill quarterly. Another cost would be water heater rental, some places are on a water heater rental system some are not.
6. As stated previously they go month to month here, leases are rare (I have 2 out of 6). Expect change over.

There are some deals here but make sure you do your research. Some of the multi family properties can be scary but there are some deals out there. It is a city with potential it has taken a bit of a pause right now (which may represent oppurtunity) but it will be back.

Thanks,
Kevin Redmond
Avoid Confusion

 

[jessebowness]

Hi Kevin,

Are you still invested in SJ?

I own a building in the Uptown area, and might be considering a change of PM.

How is POMM working out for you?