Home economics
More owners take in renters to subsidize mortgages,
Danielle Rose is living every home landlord’s dream.
Wanting to make owning a home in the city more affordable for her and her son, Rose found two reliable tenants to occupy the basement suites of her North Forest Hill bungalow. They always pay their rent in full and on time. They don’t make noise and they don’t complain unless there is a real issue.
“The rental income from the two units helps pay my mortgage,” says Rose.
“While there are times I wished I had my entire living space to myself, I am grateful to my tenants for making living in the city more affordable.”
With Toronto’s housing market showing no signs of cooling, many Torontonians like Rose are taking in renters to subsidize their mortgages.
For the three-month period ended Sept. 30, the average rent charged for a one-bedroom unit in Toronto was $1,657 a month, according to the Toronto Real Estate Board.
The city of Toronto has supported this trend since 1999, when it amended zoning bylaws to permit homeowners to rent their second suites — self-contained units that include a kitchen and bathroom. However, the challenge many homeowners face is that being a landlord isn’t always as simple as collecting a cheque every month for renting out the basement.
“The same rules, standards and codes of conduct of highrise apartments apply to small landlords,” says Susan Wankiewicz, clinic director at the Torontobased Landlord’s Self-Help Centre. “The first thing a homeowner should do is research these standards beforehand because they may have to make adjustments to the unit for it to be a viable second suite.”
Such standards include getting the unit certified by the city as a “second suite,” meaning it meets building codes, electrical requirements and fire safety rules.
Next, there’s the process of finding the right tenant for a unit. From loud parties to abused utilities, the wrong tenant can make a landlord feel like a prisoner in their own home, says April Stewart, founder of Landlord Legal in Barrie, Ont. She’s a paralegal nicknamed “the terminator” for her ability to help landlords evict problem tenants.
“It’s a lot easier to get someone in to rent than it is to kick them out,” Stewart says. “Bad tenants come in many disguises and it can take many months for an eviction to be granted if the arrangement isn’t working out.”
You also lose full control over who lives with your tenant, says Glenn Sheridan, a community legal worker at Landlord’s Self-Help Centre. “Imagine you think you are renting to a single individual and their whole family moves in. This may not be what you signed up for, but you also can’t control it.”
The advent of Airbnb, a website that allows people to rent out their units to travellers from all over the globe, is also creating new issues for landlords.
“A tenant may think this is a great way to pay rent for the month. However, landlords are often unaware of this until it’s too late,” says Sheridan. “If there is any damage to the unit, a landlord’s remedies under the Residential Tenancies Act are limited; also, their insurer may deny a claim or cancel their policy if they view the activity as a commercial business.”
Landlords must also abide by Ontario’s Human Rights Code and the Residential Tenancies Act. If a tenant’s rent arrears or disruptive behaviour stems from a disability or other code grounds, the landlord is required to show that they have tried to accommodate the tenant “to the point of undue hardship” before considering eviction.