LANDLORDS: When it comes to evicting a tenant, here’s what you need to know
Are you a landlord or thinking about becoming one? It’s important to understand your rights and the rights of your tenants – especially around eviction. (If you don’t follow them, you could face up to $25,000 in fines.)
If you decide to evict a tenant because you want to move in yourself or have a family member live there, here’s what you need to do:
Provide 60 days notice using the N12 form.
Either pay the tenant one month’s rent in compensation for the eviction or offer them a comparable unit.
Show intention that you or your family member will live in the unit for at least one year.
If you don’t follow these rules, and re-list, convert or demolish the unit within a year of the eviction, you could face up to $25,000 in fines.
Remember, these new rules apply only to landlords who want to evict a tenant from a unit for personal use. If you’ve got bad tenants who cause damage or don’t pay their rent, take that to the Landlord and Tenant Board.
What’s the reason behind these rules?
They protect tenants from unjust evictions. These are tenants who pay rent on time each month, respect the unit and the building, keep the unit clean, and have never had any problems. If the landlord wants to move into the property or offer it to a child or relative, that’s their right – after all, they own the property. But in situations where the tenant moves out, then see the unit re-listed at a higher price, or it shows up on Airbnb – the rule requiring the landlord to occupy the unit for at least a year is intended to prevent that kind of bait and switch.
The landlord’s point of view
Landlords who rent a property to pay off the mortgage rarely make a profit each month – most are just covering the costs of ownership (if that). Costs go up each year, and there are property taxes, maintenance fees, annual fire and safety inspection fees, and extra repairs and upgrades to cover, all in addition to the costs of your own primary residence.
The appeal of jacking up the rent (or doing short-term rentals) is obvious. It helps you pay down your mortgage faster and covers your expenses. And you can’t always do that with the 2.2% yearly increase. But when you enter the rental market, it’s something you have to live with. If you can’t, then maybe being a landlord isn’t for you.
The tenant’s point of view
Being a renter in Toronto is getting harder and harder. Rents are at an all-time high, and supply is way down. Evictions are happening all the time, despite the rules. Tenants are customers, and landlords are business owners providing a service. And as in any business, the costs of operating fluctuate over time. Landlords must deal with rising property taxes, maintenance fees, and other costs – just as every business deals with variable overhead. Shouldering the risk is part of doing business. It’s not the customer’s responsibility to be held accountable for low profitability.
A condo can be a great investment vehicle, but renting it out does pose some risks. Before jumping in, educate yourself, and you’ll be prepared for whatever challenges come your way.