Egad!  This makes no sense!

This condo down the street from me has been “FOR LEASE” now for a total of three full months and the seller/landlord has yet to reduce the asking price.  The condo is vacant and he is losing money.

Sense.  This situation makes none…

That guy is dressed like Darth Vader and he is using a Brita Water Filter to pour lake water into a dirty bottle.

That makes no sense.

There is a condo for lease in a building in the heart of the St. Lawrence Market for $1,550 per month that has been available now since November.

I have intimate knowledge of this situation because I used to own the unit upstairs; the exact same identical unit.

I was charging my tenant $1,450/month which I thought was very good rent for a 549 square foot condo with no locker and no parking, and I sold my condo around the same time as the unit below me sold for relatively the same price.

The new owners, er, “investors,” took possession and immediately began looking for a tenant.

That was their first mistake, in my humble opinion.

When I sell an investment property to a client, I begin looking for a tenant the day we sign the Agreement of Purchase & Sale for the property itself!  If I can get a tenant to move in the very day that my client takes possession, then he doesn’t lose a dollar by keeping the property empty!

The new “investor” at my old building didn’t look for a tenant right away.  In fact, they closed their deal in November, and then put the property on MLS at $1,550 per month with an “immediate” possession date.

I can tell you that $1,550 is not going to fly for 549 square feet with no parking and no locker, and thus this property sat on the market for a while.

After the first month, I wondered why they didn’t reduce the price.

They had already lost more than they stood to gain.

It made no sense.

By accepting $1,450 per month, they would have “lost” the additional $100 per month in rent having come down from $1,550, for a total of $1,200 per year.  But by keeping the unit empty for a month, they lost anywhere from $1,450 – $1,550 depending on how you look at it.

It made no sense.

This is a teenager who looks to be on his way to his prom, yet he had time to pickup that sewing machine and pose for a photo in front of that UPS truck that had driven off road, through a park, and into a river.

It makes no sense.

The owner/landlord of the “investment condo” never dropped his price from $1,550 per month.

After the second month passed, I wondered what the heck was going on.

Assuming that the unit is “worth” $1,450 per month, he had now lost $2,900 for the two months!  He could have dropped the price to $1,350 per month and found a tenant in two seconds and he still would have only given up $2,400 in rent for the year.

It made no sense.

But the other day I was browsing for leases in the St. Lawrence Market area and low-and-behold, I saw that damn listing again!

It’s still there!  Only now, it’s been three full months!

The owner has now lost three months at market rent – $1,450 per month, because he hasn’t dropped his price from $1,550.  He’s out three months and $4,350 which he can never recover.

He’s been paying the mortgage for three months.
He’s been paying the taxes for three months.
He’s been paying the maintenance fees for three months.

And yet, the unit has been sitting vacant.

It makes no sense.

What is he waiting for?

This person had the means to purchase a $300,000 condo, so he must be somewhat intelligent, yes?  But is Investing 101 really that difficult a course to complete?  Do we all understand that the first rule to owning an investment property is “Find a tenant”?

It makes no sense.

This picture speaks for itself…

It’s one of those questions that you ask aloud, but has no obvious answer: “What is this guy waiting for?  Why is he letting the unit sit vacant?”

Maybe the new owner is getting divorced and he doesn’t want to put a tenant into a property for a year since he could have to divest his assets and sell the property.  Or, maybe he’ll be forced to move into it himself…

We can speculate all we want, but the fact of the matter is: there is a very saleable condo in a fantastic neighbourhood that is over-priced and has been sitting on the market for three months.  This isn’t a sale where the seller is waiting for his money; this is a lease where time is of the essence!  Each month is a perishable item; like a seat on an airplane!  Once the plane takes off, every empty seat is lost revenue!

No, I can’t figure this one out.

It just makes no sense.

I’ll keep an eye on it, and if we get to FOUR months vacant, I’ll call the seller and try to interview him for this blog…