Couple builds successful company in Brandon’s stable housing market

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This article was published 25/11/2017 (3051 days ago), so information in it may no longer be current.

Building an empire within the Brandon housing market, Evan Keller and wife Jill’s company, Keller Developments, has completed more than 100 units in the Wheat City since starting up six years ago.

Already employed in commercial banking, Evan Keller said their businesses interest in developing rental units started out as a side venture and quickly progressed as they found success.

“Early on, I came to an understanding that investing in real estate was a part of growing a healthy investment portfolio, or retirement plan. However, you want to work that,” he said. “It was definitely a place to grow wealth.”

What started out as building a few houses —two four-plexes — quickly grew as they began hiring people and expanding their footprint through Brandon with the help of Darren Giilck of Royal LePage.

Their largest-scale effort is being constructed at 4151 McTavish Ave., where 24 units are complete, 24 are under construction and another 24 are to be built for a total of 72 units, plus room for some additional units.

Monthly rents have been priced at $1,275 for two-bedroom units and $1,375 for three-bedroom units.

The buildings are going to investors, and Keller said it hasn’t been difficult finding people who are interested.

“Coming from the banking side of things, people are looking to have a little bit of diversity in their retirement investments, so maybe having everything tied up in mutual funds isn’t as attractive to people anymore,” he said. “I think (real estate is) a good strategy.”

A lot of people are seeing investments such as these as long-term family investments, “maybe not just the current generation, but the next one as well,” Keller said.

The rate of return will vary based on one’s choice of revenue property and “a lot of variables,” but Keller said he has found success in Brandon’s stable marketplace, which has benefited from fairly consistent growth without the peaks and valleys other communities experience — namely those that depend on a single industry.

Brandon Area Realtors president Charla Albrecht shares in this assessment, calling Brandon’s marketplace “a fairly safe bet” and without the “roller-coaster-like market that you’ll see in a bigger market.”

“It still makes sense for a lot of people to have investment properties in Brandon,” she said, adding that even though real estate has proven a lucrative investment for some, it isn’t without its risks.

Be “very careful” when interviewing tenants, Albrecht said, adding that landlords need to factor into their plan the possibility that a tenant might trash their rental unit.

Keller said that when he was first starting out, the regulations, forms and other tools available at the Manitoba Residential Tenancies Branch website were a big help in keeping everything by the book.

Naomi Hamm, a local partner and broker with Centum Mortgage Choice Corp., said that in addition to a 20 per cent minimum down payment on investment properties, federal regulations are taking the purchase of rental properties further out of reach for the average Canadian.

As of Jan. 1, the new qualifying mortgage rate is being jacked up to the Bank of Canada rate, plus two per cent, which amounts to approximately 5.39 to 5.49 per cent.

This isn’t the amount that one pays, but the rate at which one has to qualify as a means of preparing the marketplace for potential future increases, serving as a “stress test.”

Hamm said people who would currently be approved for a property worth $410,000 will find their buying power decrease to $335,000 after the new regulations come into play, which makes things “a little trickier.”

According to data collected by Economic Development Brandon, the average residential selling price in Brandon back in 2002 was $100,259 and by last year had grown to $274,351.

Between April 2009 and October 2016, the average rental price for a three-bedroom apartment increased from $774 per month to $1,176.

» tclarke@brandonsun.com

» Twitter: @TylerClarkeMB