Home April 19, 2021

Tyrant to Champion: How to Prosper as a Landlord and Proliferate Your Wealth (with honour!)

“Historians of Real Estate will say I am a liar, but history is written by those who have hung heroes.” – John Edward Hewerdine III

If you’re a bodacious baroness, a valiant viscount, or a rustic boor transcending into the realm of magnificence, I beg you to give heed and dispatch your riders with urgent scriptions for the real estate services of John Edward Hewerdine III (me!).

I am the keeper of skeletons in towers, the transferor of ironclad stored intelligence. I will be your aide in expanding your future sumptuous monarchy and immeasurable manorial systems. Fulfill your destiny beyond your most untamed fantasies and transform yourself into the next modern-day King William of Normandy.

Lucrative liege-iness is upon you!

“His weight with the commoners will unbalance everything.”

Nothing on this earth worth doing is easy, and if you desire a bargain in this extreme seller’s market, you will need to venture into lands that others rebuff: the terrifying territory that is tenant-occupied homes.

The feeble consider tenant-inhabited homes a deterrent, but the fearless confront the chance as a prolonged, swash-buckling affair of honour…and conquer! For, you see, tenanted homes can come with a reduced purchase price, and if you are skilled in the art of action and residential tenancy tactics, this investment sphere is yours to lay hold of.

The average commoner will avoid purchasing a household occupied by tenants, whether for personal use or investment purposes. Lessees can make the process challenging for the vendor and purchaser; for example:

1. The property may be uncared for
2. Tenants may be uncooperative
3. Purchasers must assume the current lease

A true knight of the any-shape table will not allow these challenges to cast them into the shadows of despair, for this is where the dragon sleeps on its mountain of gold. Now, decompress my nimble noble; ‘tis time to murmur codes of chivalry, evictions and termination notices, so you can muster the courage to acquire a tenant-occupied residence. After all, you deserve success for your scrupulous endeavours, agreed?

“Fight and you may die. Run, and you’ll live… at least a while. And dying in your beds, many years from now, would you be willing to trade all the days, from this day to that, for one chance, just one chance, to come back here and tell your tenants that they may take your rental unit, but they’ll never take your freedom…of rights!”

Whether you purchase your new fortress with existing tenants, or decide to import new ones, it is important to know your rights as the Residential Tenancy Act applies to both.

Ignoring your rights as a liege lord will create frustration and will quickly transform you into the next King Edward Longshanks. Before long, you’ll be abusing your power by backhanding your own tenants across the cheek and tossing their lover(s) out the nearest window.

“One does not simply walk into tenant-occupied homes. Their black gates are guarded by more than just pets. There is evil there that does not sleep, and the great nanny cam is ever watchful. It is a barren wasteland, riddled with cat hair and clutter and dust; the very air you breathe is a poisonous fume.”

With valiant vigour comes substantial duty. Eviction is not as simple as sending in the kingdom’s soldiers and casting the current tenants into the village gutters. As a landlord, you can only evict in specific circumstances and must offer written notice using the proper form offered by the Landlord and Tenant Board. The form must set forth the rationale for eviction.

Even if you provide the tenant with written notification (in ink or blood!), they may not be obliged to withdraw. You will first need to apply for, and receive, an eviction order from the Landlord and Tenant Board. Tenants have the right to take part in a hearing and plead their eviction innocence.

“The trouble with tenant-occupied homes is that they’re full of tenants.”

Hinging on the lease classification the tenant is fastened to, the notice of termination must be dispensed before the specified conclusion date and within a required timespan. That date shall be on the final day of a rental period in order to take effect.

DAILY. A minimum of 28 days is required to terminate a daily tenancy.
WEEKLY. No less than 28 days is a must to discontinue a weekly tenancy.
MONTHLY. At least 60 days is needed to put an end to a monthly tenancy.
YEARLY. A requirement of 60 days is necessary to cease a yearly tenancy.
FIXED TERM. A benchmark of 60 days is essential before the expiration date specified in a fixed term tenancy agreement.

A tenant who receives notice of termination may, at any time before the date defined in the notice, tuck tail and run from the tenancy no less than 10 days before the date the notice is dispensed.

A notice of termination will metamorphose into a void state 30 days after the specified date in the notice unless:

1. The tenant relinquishes the rental dwelling beforehand
2. The landlord applies for an order to terminate the tenancy and evict the tenant before the black hole of void-ness

“There is no curse in Elvish, Entish, or the tongues of Men for this treachery.”

Rules under the Protecting Tenants and Strengthening Community Housing Act, 2020 and existing rules under the Residential Tenancies Act, 2006 help make certain that the tenants’ liberties are safeguarded.

Under the law, the maximum fine for a wrongdoing under the Residential Tenancies Act, 2006 can climb to $50,000 for an individual and $250,000 for a corporation.

“There is only one Lord of the Land, only one who can rent to their will. And they do not share power.”

Landlords are required to offer tenants the equivalent of one month’s rent, or present another place of residence if they:

1. Desire to use the unit themselves
2. Fancy the digs for their family members
3. Require the pad for a care service mainstay
4. Vend the property and the purchaser will sidle into the accommodation

The date for termination defined in the notice shall be at least 60 days after the notice is designated and the day a period of the tenancy ends or, where the tenancy is for a fixed duration, the grand finale of the term.

“A day may come when the courage of landlords fails… but it is not THIS day.”

Landlords must compensate their tenant if they evict them from their dwelling for the subsequent reasons:

1. To renovate
2. To repair
3. To demolish

The date for termination specified in the notice shall be,

1. At least 120 days after the notice is received, if the residential complex in which the rental residence is located contains at least five residential units, and shall be the day a period of the tenancy ends or, where the tenancy is for a fixed term, the end of the term.
2. At least 60 days after the notice is given, if the residential complex in which the rental residence is located contains fewer than five residential units, and shall be the day a period of the tenancy ends or, where the tenancy is for a fixed term, the end of the term.

A landlord shall present the tenant a spare rental unit satisfactory to their requirements, or shower the tenant with shillings in an amount equal to:

1. Three months’ rent if the residential complex in which the rental unit is located contains at least five residential units
2. One month’s rent if the residential complex in which the rental unit is located contains less than five residential units

Tenants must receive the right of first refusal to re-enter the unit following a renovation. Tenants must notify the landlord in writing before they evacuate, and inform the landlord to offer them the unit when the renovation has concluded.

Under the rules, if the landlord fails to provide the tenant a right of first refusal, they will have two years to file a claim with the Landlord and Tenant Board for compensation.

“It is useless to meet revenge with revenge: it will heal nothing.”

Landlords must act in good faith when dropping the hammer of eviction for reasons that are not the tenant’s fault. In other words, the landlord must have honest intentions to use the rental unit for the purpose stated on the eviction notice.

A landlord could find themselves in dire straits if they lie about their intentions by:

1. Advertising the place of habitation for rent
2. Entering into a tenancy agreement with someone other than the former tenant
3. Advertising the rental quarters, or the building that contains the rental unit, for sale
4. Demolishing the domicile or the building containing the rented domicile
5. Taking any step to convert the lodging, or the building containing the lodging, to use for a purpose other than residential premises

Landlords are also required to disclose past use of no-fault evictions when applying for new no-fault evictions. This indispensable information assists the Board when determining whether the application was submitted in good faith and if an eviction order should be approved.

If the Board determines that a landlord is a devious proprietor and has given a notice of termination in bad faith, they may require the landlord to pay the former tenant the sum of:

1. The difference between the final rent charged to the former tenant and the former tenant’s current rent in their new unit for up to a one-year period
2. Up to 12 months of the last rent charged to the former tenant, and
3. Moving, storage and other expenses that the former tenant has incurred or will incur, within reason

This applies to all bad faith evictions, including:

1. Where the landlord does not allow the tenant to move back into the unit after repairs or renovations
2. Where the landlord or purchaser does not move into or use the unit themselves

“A red sun rises; rent cheques have bounced this night.”

A landlord may shove a notice of termination down a tenant’s throat on any of the following grounds:

1. The tenant has persistently failed to pay rent on the due date.
2. The tenant has ceased to meet the qualifications required for occupancy of the rental unit.
3. The tenant was an employee of an employer who provided the tenant with the rental unit during the tenant’s employment and the employment has terminated.

“Certainty of death. Small chance of success. What are we waiting for?”

A landlord may give an unlawful tenant a notice of termination if they or another delinquent occupant commits an illegal act or carries on an illegal trade, business or occupation or permits another malefactor to do so in the rental unit or the residential complex.

A notice of termination under this section shall set out the grounds for termination and shall provide a termination date not earlier than,

1. The 10th day after the notice is given, in the case of a notice grounded on an illegal act, trade, business or occupation involving,

(i) The production of illegal narcotics
(ii) The trafficking of illegal narcotics
(iii) The possession of an illegal narcotic for the purposes of trafficking

2. The 20th day after the notice is distributed, in all other cases.

“The board is set; the pieces are moving. We come to it at last: the great repayment agreement battle of our time.”

The Protecting Tenants and Strengthening Community Housing Act, 2020 encourages landlords to negotiate a repayment agreement with a tenant before seeking eviction if rent has not been paid during the COVID-19 pandemic.

When a landlord petitions for an eviction order for rent arrears, the Landlord and Tenant Board must consider whether the landlord tried to collaborate with the tenant to level the score before changing the locks. This is to encourage repayment agreements so evictions can be avoided.

Landlords are encouraged to work in harmony with tenants to establish reasonable arrangements for repayment of rent. If a landlord applies to the Board for an eviction based on non-payment of rent, the landlord and tenant may settle the eviction application by reaching a formal repayment agreement that is signed and sealed by the Board.

States of affairs can alter, and a tenant might be unable to meet the terms of a Board-approved repayment plan. If a landlord succeeds with an eviction order, tenants can still beg the Board for a hearing to consider their plea before an eviction order is enforced.

If tenants are struggling to meet a repayment agreement that the Board did not approve, landlords still must apply to the Board for an eviction hearing. At the hearing, tenants will be able to illustrate why they were unable to follow the repayment agreement.

Repayment agreements, whether formal or informal, do not give landlords permission to evict a tenant without an order from the Board. Tenants are still permitted to request a hearing and the Board can consider the circumstances of each case to determine whether or not an eviction order should be issued.

Landlords cannot impose repayment agreements on tenants, and tenants cannot be evicted for refusing a rent repayment plan (regardless of how justifiable it seems). It’s an offence under the Residential Tenancies Act, 2006 for a landlord to harass or threaten (or throw a tenant out the window, Longshanks!), to persuade them to move out.

“Who is this person that speaks to me as though I needed his advice?”

Mediation can be helpful to resolve disputes quicker and dirtier. It is less formal and intimidating than the traditional hearing process. Its intention is to help spark a conversation between tenants and landlords under the guidance of a neutral mediator who knows the rights and responsibilities under the Residential Tenancies Act, 2006.

Under the Protecting Tenants and Strengthening Community Housing Act, 2020, the Landlord and Tenant Board may require tenants and landlords to attend a mediation session to discuss their concerns in advance of their hearing. Landlords and tenants are not required to reach an agreement.

If both parties are unable to reach an agreement in mediation, a formal hearing will be held, and the tenant will be sentenced to capital punishment – the guillotine (just checking in to see if you’re still reading)!

“I thought up an ending for your book: ‘And thou lived happily ever after, til the end of thy days’… as a landlord.”

Now, set forth my grand duke of dynasties! Take this invaluable knowledge inherited from regal wizards, and begin your journey to becoming the ultimate lord of the lands! Ladies-in-waiting and gallant knights await your kingdom-ruling lance.

Residential Tenancies Act: https://www.ontario.ca/laws/statute/06r17
Help for Landlords: https://tribunalsontario.ca/ltb/help-for-landlords/

Pining for more real estate knowledge in the name of the king? Chain mail me for all of your real estate yearnings.