June 6, 2024

Catherine Marshall

Is being a landlord a bad thing? The media has been full of negative stories. Small landlords in Ontario are protesting, say that the deck is stacked against them.  

Small landlords are taking their grievances to the Ontario Legislature. They want new rules to evict a tenant after two months of non-payment. Seems reasonable.

But there’s another side to the story. Tenants’ groups counter that some landlords are taking advantage of renters. By threatening the roof over their heads, they say landlords hold the trump card.

We think that being a landlord has been a great experience for most. Landlords with happy tenants generally avoid the problems that encourage non-payment of rent.

Credit Scoring

There’s an effective way of encouraging rent payments that’s coming into play. That’s to include rent payments in a tenant’s credit score.

Called the Canadian Renters Bill of Rights, it’s included in the federal budget. It encourages credit agencies to receive landlord reporting of rent payments.

Rent is often the single largest recurring monthly component of a renter’s expenses, so if rating agencies include rent payments it’s likely to have a marked impact on credit scores. That’s good for landlords.

It also helps renters, especially new immigrants, to get ahead. According to Equifax, three million Canadians are credit invisible and seven million Canadians have a thin credit file.

Good to me, bad to brother

Being a landlord has been a positive and profitable experience for Greenbilt. But a close relative of President Mike Manning had the opposite experience.

This relative saw the landlord-tenant relationship change during the pandemic. 

In that situation, the moratorium made it impossible to get rid of tenants who were destroying the property as well as withholding rent. Even after the moratorium ended, the backlog in eviction applications cost the landlord tens of thousands of dollars, and significant stress. As a result, he now rents his property through Air BnB.  

The Ontario rental market has lost a single-family home due to bad actors.

Mess at Landlord Tenant Board

We have found there are ways to avoid the bad actors.

However, in some situations the non-payment of rent has been a reasonable tenant reaction to the landlord ‘s behavior.

Some landlords let their properties deteriorate significantly while they raise rents.  Tenants feel they have been tricked into renting something that has been taken away.

Other landlords increase the rent too quickly given the tenants’ ability to pay. In today’s market, these tenants fear becoming homeless and want to save up before they are forced out.

In both cases, tenants feel they are being treated unfairly.  Rent non-payment is the tenants’ way to protest as it can take tenants months or years to get a hearing at Ontario’s Landlord Tenant Board (LTB).

However, it’s true that post-pandemic, the huge backlog in eviction applications to LTB is encouraging bad tenants to take advantage of the situation. They get a long “rent holiday” before they are evicted.

A government report has called out the LTB for its failure to hear cases promptly and the provincial government hasn’t fixed the system yet.

In reaction, landlords are turning to social media to protect themselves.

However, once the system is fixed, we’ll be back to a situation where neither the landlord or the tenant holds the Ace.

We support Landlord success

Getting the right tenants and giving them what they’ve paid for is the secret to landlord success. Our FlexPlex®home helps you to succeed by giving you the right product at the right price. If you aspire to be a landlord, please contact us.

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