Episode 13: Leasing 101

[00:00:01] Speaker A: You are listening to TheRealEstatePodcast CA brought to you by JNC Toronto Real Estate Group. Well, hello, everybody, and welcome back to the realestatepodcast ca. John and Cheryl, here with the JNC Toronto Real Estate Group, along with our friend and colleague, Nicole Norton. [00:00:23] Speaker B: I like the way you did that. That's nice. [00:00:25] Speaker A: Hi, ladies. Yeah, because we have some news. You know, for those of you that have stuck with us for the first 12 podcasts, Nicole is spreading her wings. [00:00:35] Speaker C: Going out on her own. [00:00:36] Speaker B: All by myself. [00:00:37] Speaker A: All by myself. [00:00:40] Speaker B: Completely unrelated. Today's topic is leasing. [00:00:43] Speaker C: However, I want to say all by yourself. But we will still be working together as colleagues and friends, of course. [00:00:51] Speaker B: Yeah, well, I did until just, like, three seconds ago. [00:00:56] Speaker A: Yeah. [00:00:57] Speaker C: So from the not friend column to the friend column. [00:01:00] Speaker A: Well, we wanted to have Nicole on. You've been such a big part of the podcast so far, and, you know, it's funny because it's been a little while since our last podcast. [00:01:09] Speaker B: How long has it been? [00:01:10] Speaker A: Don't ask. [00:01:11] Speaker B: Okay. [00:01:11] Speaker A: Okay. Yeah. [00:01:12] Speaker C: Don't ask, don't tell. [00:01:13] Speaker A: Because of that, I kind of want to share to our faithful listeners how the podcast started. It kind of goes like this. John's like, hey, I think we should do a podcast. Nicole's like, hey, that sounds like a great idea. [00:01:24] Speaker C: Cheryl's like, we don't have enough time. [00:01:26] Speaker A: Exactly. I wrote that right there. And so I just want to say, once again, Cheryl, you were right. [00:01:34] Speaker C: On YouTube, on podcast, for everyone to see. [00:01:38] Speaker A: Yeah, it does. Obviously, working a lot in the business as realtors. We're not part timers, so sometimes time gets away from us. A lot of things. Throughout the fall, and then took a little time off, had a bit of a vacation, Cheryl and I, and. But now we're ready to hit the ground running in 2025, and it's going to be awesome. But hey, enough about us. Let's talk about you, our faithful listeners, and why we're covering this topic today. Today's episode is called Leasing 101, and. [00:02:07] Speaker B: I would like to interject something. [00:02:09] Speaker A: Oh, yes. Before we get started. [00:02:11] Speaker B: The views and opinions expressed in this program are those of the speakers and do not necessarily. [00:02:16] Speaker C: Oh, man. [00:02:17] Speaker B: It was my last one and I screwed it up. The views and opinions expressed in this program are those of the speakers and do not necessarily reflect the views or positions of any entities that we represent. [00:02:28] Speaker A: Well done. You're fired. [00:02:29] Speaker B: You can never do it again because. [00:02:31] Speaker A: You screwed it up, but good job. [00:02:32] Speaker C: Oh, I like how she high fives. See, she just touched my hand. That's it. She didn't try to punch me through the wall. [00:02:37] Speaker A: I don't try to punch you. I'm just a bit rough and tumble. Cheryl. So lots of our clients and listeners either own investment properties or they've explored buying them and they've asked us, you know, how do we get a good tenant? That's one part of today's podcast. Also, some of our listeners maybe tenants that need to rent or know someone who needs to rent a property. And for any of you listening who fits that description, this episode is for you. [00:02:59] Speaker C: Chery, I just wanted to say that many people do believe, and you may have this in your notes, that you don't need a realtor to rent, whether you're. [00:03:06] Speaker A: I do have it in my notes. [00:03:06] Speaker C: Or a landlord. Would you like me to stop then? [00:03:08] Speaker A: No, no, no, please. [00:03:09] Speaker C: Many people who are trying to rent, whether they be tenants or landlords, believe they don't need a realtor. And you don't need a realtor. [00:03:17] Speaker A: You don't need one. [00:03:18] Speaker C: However, it's very popular in Toronto specifically. I'm not even sure that it's popular in other major cities in Canada. [00:03:24] Speaker A: Yeah. [00:03:25] Speaker C: To use a realtor while renting. And it's easy for the landlord because the realtor almost creates another level of checking references and making sure it's good fit. Also, the MLS goes out to a lot more people, so you'll have many more tenants looking. And so it's become, I would say, over the last five, seven years, very popular for tenants and landlords to use realtors to help them find a perfect. [00:03:46] Speaker A: Place to rent, especially getting it on the mls. [00:03:48] Speaker B: A lot of people like to use Realtor ca. [00:03:50] Speaker C: Yes, yes. [00:03:50] Speaker B: And that's how you get your lease on Realtor ca. [00:03:54] Speaker C: Realtor, Realtor. [00:03:55] Speaker A: We're going to cover that when we get to some of the features and benefits of working with a realtor, what some of the services are as we go through. So that's gonna be part one. We're gonna break it into two parts. [00:04:05] Speaker C: Firstly, thanks for jumping ahead. [00:04:06] Speaker A: Hey, that's no problem. We'd like. When you jump ahead, we like to ad lib. It's never totally. [00:04:11] Speaker C: We don't know his notes. [00:04:12] Speaker B: No. [00:04:14] Speaker A: If you're wondering how the whole podcast thing goes, I go and I make the notes and I get the ladies to show up. Because one of the agreements was if we're gonna do a podcast, John's gonna be pretty much doing all the work. And. Yeah. [00:04:25] Speaker C: Cause we were like, we don't have time. And you're like, how about you just show up? We're like, cool. [00:04:31] Speaker A: And hey, it's been working, I think. [00:04:32] Speaker B: Anyway, we get a coffee for showing up. [00:04:35] Speaker C: I know. I feel really bad that we don't have a coffee right now. [00:04:37] Speaker A: I've already had two, so. And I don't need the extra energy because it's all about John. All right, so we're going to break it into two parts. Firstly, we're going to discuss the risks and benefits of being a landlord. We want to share from our experience as landlords and representing them how to minimize risk when qualifying tenants. We also want to cover what services we offer our landlord clients and what the benefits are when using a real to list your property. So you did jump ahead there, Sheryl. [00:05:03] Speaker B: But I love this topic. It's such an information rich topic for the people. [00:05:07] Speaker A: For the people, for the landlords and for the tenants. And you know what? I think for maybe some of the Realtors out there as well, because we do know we get a lot of Realtors listening to us, especially some new ones that might just want to know maybe how it is that we do what we do and maybe we can give them some guidance and advice. [00:05:21] Speaker C: Yeah, you're right. Most Realtors want to talk about buying and selling. Not many will dig deep on leasing, which is incredibly important. [00:05:28] Speaker A: I'm going to cover that a little bit later, too, so. I know we're covering that now. Are we going to have enough time? I know, but secondly, we're also going to share with our tenant listeners ways to help you get accepted in a very competitive market. If it is a competitive market, especially having represented many tenants, many, many tenants. [00:05:46] Speaker C: Even when it's not a competitive market with leasing. It's sort of a competitive market. [00:05:50] Speaker A: Oh, it is. Yeah. There's. There's very discerning landlords out there because of. [00:05:54] Speaker B: For good reason. [00:05:55] Speaker A: Yes. And we're going to talk about some horror stories that'll be interesting. I think a lot of people will be interested in seeing exactly what it is. [00:06:01] Speaker C: Yeah. Tenants don't often know their rights. Landlords don't sometimes know their rights. Landlords overstep boundaries a lot and tenants don't know what they can do. And then there's tenants that take advantage of that as well. [00:06:10] Speaker A: Totally. Yeah. Okay, part one, Working with landlords. Nicole. [00:06:17] Speaker B: Yes. [00:06:17] Speaker A: Let's start with you. [00:06:19] Speaker B: Sure. [00:06:19] Speaker A: Like Cheryl and I. [00:06:21] Speaker B: Yes. [00:06:22] Speaker A: You are a landlord. [00:06:23] Speaker B: Yes. [00:06:23] Speaker C: Oh, you are. [00:06:24] Speaker B: Many times. [00:06:25] Speaker A: And over the years you've owned investment properties. What do you look for when you have tenants looking to Rent your property. [00:06:34] Speaker B: Where do you. I know this because as both the realtor and the landlord in the transaction, it's a completely different thing. [00:06:44] Speaker C: A good fit. [00:06:45] Speaker A: Yeah. [00:06:45] Speaker C: Depending on what it is that you. [00:06:47] Speaker A: Would you say that first and foremost you really want to try to qualify your tenant. [00:06:51] Speaker B: I really want to qualify the tenant. What I found there's so much information that's required to apply for a lease and as is the standard normally. Right. I don't know if we're going to cover that later in the notes and I shouldn't. [00:07:02] Speaker A: Of course we are. But that's cool. No, this is great. This is free flowing. [00:07:04] Speaker B: We need the Equifax credit report with score. We need a proof of income, which is a job letter and pay stubs. We need driver's license, some form of I.D. even just that. And then there's some supplemental forms. There's an application. Before we even do the formal application, 90% of people, when you give them that list, they do not send you that back. I always say the process of the application part of it is just getting the application together. If I have someone that I say that to once and they send me all of those documents just like I said them to you, like this person is switched on. This person is someone I want taking care of my house. This person. This is the Equifax credit report with score. [00:07:42] Speaker C: Because the way you do any is. [00:07:44] Speaker B: The way you do everything. [00:07:46] Speaker A: It passes the sniff test, right? Yeah, it's the first impression shows what. [00:07:49] Speaker C: Kind of person you are for sure. References as well. You forgot that one. [00:07:52] Speaker A: Yeah. [00:07:52] Speaker B: References. Yeah. Oh yeah, that's great. That's a great one. [00:07:56] Speaker A: Paperwork package. I think I wrote paperwork package about 10 times when I was making the notes. It's a. It's really very important that. [00:08:02] Speaker C: And it can change. [00:08:04] Speaker A: It can change. What do you mean, Joe? [00:08:06] Speaker C: Well, it depends on the person that's applying. Maybe their employment is something like where they earn commissions or tips. So they need to show that they have money. So maybe then you are showing a balance in your savings account. Or maybe you have stocks that you can show a balance that you have something else otherwise or passive income coming in. Maybe you have a co signer so then you need the co signer's information. Or maybe you are here on a visa. So then we need to confirm that you're here legally and that you have just depends on the actual person. Those. The paperwork you spoke about is the main paperwork. But then there's like maybe we'll need. [00:08:42] Speaker A: Some extra because all tenants are not created equal. Not saying that some are good and bad, which is quite often the case. There might be two excellent tenants what could be a great fit for you with vastly different kind of profiles if. [00:08:54] Speaker B: They'Re self employed and landlords, I do find some of the, I mean not maybe, let's say 30 to 50%, they actually want to stay away from self employed people, which as a self employed people I don't think is fair. But that person has a different set of paperwork that they provide. [00:09:07] Speaker C: The paperwork isn't as clear, which is why landlords are like, I don't want this because it doesn't seem like they have a paycheck that's coming into every two weeks. [00:09:16] Speaker A: Yeah, yeah. [00:09:17] Speaker C: And they will normally if there is a landlord open to it, they ask for the notice of assessments. [00:09:22] Speaker B: And yes, now I'm getting three years as the standard. Yeah, yeah. So to really make sure, you know, someone doesn't, you know, have a lark of a business or whatever it is, they want to see stability in that income. Right. Plus they want to see in their bank accounts to see operating income, which I mean it is what it is. Right. [00:09:39] Speaker A: You're the landlord, it's your, you get to choose. [00:09:42] Speaker C: Yeah, I'm, I'm going to guess that you will get to this later on, but what happens if you don't look good on paper? You know, because I was just going to say how sometimes a landlord and tenant meeting and you know, we'll be. [00:09:55] Speaker A: Getting to that later on. Sure. But make a little note to make sure that I get to that it's. [00:10:01] Speaker C: Still a people to people business. So sometimes you got to put people together. [00:10:04] Speaker A: Exactly. [00:10:04] Speaker B: And that's lastly so paperwork package. But what else do we look for? I like to meet potential tenant because really follow your gut, talk to them, talk to them about their job, talk to them about you. You're going to get a great idea from talking to them, even just observing. If it's a couple, you know, how they're interacting with each other, they hate. [00:10:24] Speaker A: Each other, they about to break up and then one person's going to be stuck there trying to cover the entire rent. [00:10:27] Speaker C: Yes, they'll be red, you'll see the red flags for the most part. And also that's another one with couples. Like ask them questions, how long have they lived together? Have they lived together before? Because sometimes that's a risk. [00:10:37] Speaker B: Like have a conversation, not just an interview because in that conversation you'll get to learn a lot about them and. [00:10:42] Speaker A: It'S relevant if you're good at asking the questions. There's some landlords that just aren't. That don't want to be bothered with it. [00:10:48] Speaker B: Maybe they need a realtor. [00:10:50] Speaker A: That's a really good segue I think because there are benefits of using a realtor as a landlord and as a tenant. But let's start with the landlord. First of all, I think that MLS exposure is, is one of the biggest benefits and that's what we call on market. There's also ways that you can advertise your listing off market and we'll talk a little bit about that shortly. But having an experienced agent like ourselves and many of our colleagues who do leases that have been through this many times before will know what questions to ask, be able to figure out what kind of red flags there are maybe in the paperwork, or be able to look past what may not be the most ideal aspects of a person pro person's profile by digging a little bit deeper. And there might be a reason why their credit score is not ideal. If it's a brand new landlord, it doesn't. Is not familiar with that. And they look at someone with a 600 credit score, they might be alarmed not knowing that the person's only been in the country for six months and doesn't really have credit. So new credit is very, very low. And they might be properties abroad and they have a great job. [00:11:56] Speaker B: The score is not always the biggest indicator. That's why we have credit report with score. You look at the score, but look at the report. The report's going to tell you why. And we, having read many, many, many reports, can now read through a little bit more why something is wrong. [00:12:08] Speaker C: I was going to say the flip to what he said. A low credit report might be because there isn't enough information. And sometimes a high score doesn't mean they're good. [00:12:17] Speaker A: Nothing is as crystal clear as it seems ever. [00:12:20] Speaker C: And what you were trying to say, I think the benefits of using a realtor on either side is that you dig deeper. You don't just take it for what it is. You don't just look at the document like you have to ask questions. You have to do some sleuthing on the Internet. [00:12:33] Speaker A: Yeah. And good realtors would do that and experienced realtors would do that. I do want to cover the fact that in many cases, especially when we're talking about tenant representation, which we'll get to, it may sometimes be newer agents that are doing that. They might not have the experience you'd want to as a tenant and or as a landlord. Just make sure. That if the agents I guess are newer, that they are at a good brokerage, have good mentorship, that the support. Good support so that they'll be able to act in your best interests and uphold their fiduciary duties. And don't put the douchey in fiduciary. [00:13:02] Speaker C: Did you even catch the way he said fiduciary? I knew the joke was coming. [00:13:07] Speaker A: Thank you. Thank you. And you know what? There are also some platforms that realtors, landlords and tenants can use, such as single key. If you go online, it's. It's an interesting platform where you can put in all of your information. You do pay a fee, but it gathers, it does credit checks. And so I know that some landlords, some property management companies, some. There's even a portal for tenants if you want to get all of your information to together on single key, they'll assist with that. And so for some similar things that that agents will do. [00:13:37] Speaker C: Single key. [00:13:37] Speaker B: I have a realtor right now that I might be applying for a unit and the realtor is using it. [00:13:42] Speaker A: Yeah, no, that's a lot of realtors do. [00:13:44] Speaker C: Yeah, it's. I think it's mostly landlord real representation that has the, the monthly or whatever subscription. [00:13:53] Speaker A: Right. Yeah. And so that's something that you may want to look into if you're thinking about becoming a landlord or if you're a realtor. You want do some research because there are some, I think great features and benef some of these platforms and that might help to streamline the process and save you some time as an agent or as a landlord. [00:14:10] Speaker C: You're speaking though based on us not having used single key before. So we can't speak to our experience. We can just speak to what we have learned from other agents being online. [00:14:21] Speaker A: Looking at the reviews, things like that, their services. [00:14:23] Speaker B: Just because I'm in it right now, I opened it up and it's like before you apply, look at this. I've got to fill out three extra forms. I've got to run another credit check. I've got to do this. I told the like. Dear client, do you want to do this? We've got all these places to apply for. We have everything together for every place except this one, which is going to take us an extra two days, extra money, extra. And she's like, I don't. Yeah, they can't lease the. [00:14:46] Speaker A: So it was a detriment. Interesting. That's, that's very interesting piece there. [00:14:50] Speaker C: Yeah, yeah. Because I'm sure you'll get to this as well. Leasing is about three times the amount of paperwork than purchasing or selling. [00:14:57] Speaker A: Now there's a lot of agents that just don't do it. That was going to be near the end of my presentation and our topics for the podcast today. But there are agents that don't do leases, so. [00:15:05] Speaker C: Right. [00:15:05] Speaker A: Just because it's a lot of work. [00:15:07] Speaker B: A lot of work. [00:15:07] Speaker A: It is a lot of paperwork. So other things that you want to potentially look at is what their income ratio is to what they're going to be paying for rent. And in Toronto you got to take that with a grain of salt because 5050 is not uncommon. Where it should be 60, 40, some 30, 70. [00:15:25] Speaker C: Because I think wherever we learned that it became sort of the norm to be accepted. That 7030 is I think like I don't know, based on the bank of Canada recommendation, 30% of your earnings go towards your rent or mortgage. [00:15:38] Speaker A: That's yeah, 70, 30, rent to income ratio. [00:15:40] Speaker C: And then we drag it up be like, you know, 60, 40. And then people apply and they're like 50 50. And we're like hm, how does this work? [00:15:47] Speaker A: Well, rents are expensive. [00:15:48] Speaker C: I know. [00:15:49] Speaker A: Can I do a little aside here in our notes just with regards to the rental market in, in Canada and it's a little different obviously in Toronto, but new report from Rentals CA and Urban Nation, which a great organization. So the average rent in Canada was down 1.6 year over year in November. So it's I guess a pleasant surprise. [00:16:06] Speaker B: In Canada. [00:16:07] Speaker A: In Canada, but it's actually slightly down in some major markets. [00:16:11] Speaker C: I feel like it's down in Toronto. [00:16:12] Speaker B: A little bit in our market. [00:16:13] Speaker A: Yeah, the average national rent was $2,139, marking a 15 month low. I know. This is the second consecutive monthly dip after over three years of increases. Despite the dip, the average rental prices on a national scale, they're still up 6.7% higher than in 2022 and 18.8% higher than in 2021. So 20% more almost than just four years. And that's according to the Globe and Mail. [00:16:41] Speaker C: Well, hopefully that. Would you call this like a correction, a stabilization? It coming down a little bit because that plus 18% is ridiculous. [00:16:52] Speaker B: I have trouble with national statistics in Canada. I mean Vancouver versus Frederickton, New Brunswick versus. It's so different. The markets are there and they're all doing different things and we're really just taking a mishy mashy from the middle. [00:17:03] Speaker C: And where are they getting information? Because as we said in the beginning, not everyone use realtors. [00:17:07] Speaker B: That's Right. [00:17:08] Speaker A: They must have their, their sources of information. But this is just throwing a wide. Casting a wide net and looking at the big, big picture. Not going deep into any one of the sort of major markets specifically. [00:17:19] Speaker C: But we're kind of feeling this overall regardless. We are. [00:17:23] Speaker A: Okay, so that's some of the qualifying. Probably get back to even more ways to qualify tenants. So the benefits of using a Realtor, we talked about the experience, let's talk about the cost. And everything is negotiable in real estate. There is nothing that is. We call standard and that goes for compensation for buying and selling. We know what is kind of the norm, what we see in different markets and what we see is the norm and the rental market here in Toronto is the cost to rent your property out. [00:17:49] Speaker C: Is Cheryl through for a landlord? [00:17:51] Speaker A: Yes. With a Realtor? [00:17:52] Speaker C: Yes. One month, typically one month rent plus hst and similar to when there's purchasing, half of that amount goes to the tenant's representation and their brokerage and then half goes to the listing brokerage and obviously the listing agent and. Yeah. And then the services that are included with that vary. [00:18:14] Speaker A: Yeah, that's the thing. [00:18:15] Speaker B: You get a piece of their soul. [00:18:17] Speaker A: Well, there's a lot of. [00:18:18] Speaker C: So it's free. So to go back to that, it's free in the sense that tenants don't pay anything out of pocket for that. The landlord handles the payment of the realtors. And then the services offered obviously are different for tenant and landlord, but the landlord services in particular vary more than I think the tenant services. [00:18:36] Speaker A: And I'll tell you why you're not going to get usually staging, because a lot of our landlord clients said, are you going to stage? It's like, well, no, because staging may cost $3,000 and. Or more. Exactly. Or less right after everything. [00:18:50] Speaker C: So. [00:18:51] Speaker A: So no, we don't. [00:18:52] Speaker C: Not a good business. [00:18:53] Speaker A: No, it's not. But because I have the experience doing professional photography and, you know, videography and things like that, we include that most agents will. Not necessarily. Some will do professional photos. A lot will do iPhone photos just because of the cost of what they're. They're actually making. It's cost prohibitive and it's may not make as big a difference. I think it makes a difference to get you a good tenant and to get more eyes on the prize if you've got good photos. [00:19:14] Speaker B: Sure. [00:19:15] Speaker A: But then. So yeah, it's going, it's going to vary. So ask your agent if you're looking to rent a property out, if you're a landlord, what services are going to offer for that compensation. [00:19:24] Speaker C: I would say at a minimum you're going to get photos whether they're professional or not. But for real, right? Like you're going to use everyone's got an iPhone, obviously they're going to list it on the mls. So all the paperwork and work that goes into it with that and then some will just take in offers and send them to their landlord for the landlord to do the due diligence. However, some will take in that paperwork, do some due diligence before and then guide and advise their landlord accordingly and then maybe do reference checks and you know, make sure that the landlord and tenant get connected if there's going to be a meeting or anything like that. So taking it all these extra steps. [00:19:59] Speaker B: They'Re going to provide you a system for booking. Although maybe not everybody has broker, but. [00:20:04] Speaker C: Majority of brokerages do use broker bay. So they'll be. Exactly. So if you're listing it on your own, and I actually made this an on market, off market note, off market landlord, say, puts it on Facebook, Marketplace or Kijiji or Craigslist, then they're handling all the calls, Then they're having to book times to take those people through where with a representation, a Realtor, Realtor is probably going to have a brokerage with the system where Realtors book through the system and they can just go. [00:20:29] Speaker B: Access tenants are notified. [00:20:32] Speaker A: And I can tell you as landlord representatives, there's a lot of unrepresented people that come to us calling the listing agent. So then we have to kind of facilitate a lot of the showings. [00:20:41] Speaker C: But the landlord does not facilitate. [00:20:43] Speaker A: Exactly, exactly. One thing that we do want to recommend to any landlord out there is we highly recommend having a meeting either via Zoom, FaceTime or in real life IRL with your potential tenant. Because there is something to be said about being able to look someone right in the eye, be able to get a good vibe from them. And you know, Ken, some people might look really great on paper and may not be. So in, in real life, paperwork can be fudged as well. [00:21:17] Speaker C: That's a whole other podcast that is your recommendation, I would say is whether or not a landlord is using a Realtor. So you. [00:21:25] Speaker A: Whether or not. Yes, exactly. [00:21:26] Speaker C: Like if you're using a Realtor, we are going to guide and advise our clients. Like, do you want to consider meeting this person before making a decision? Make sure that there's no red flags that you get along with them because good fit is important. But also if you're doing this on your own and you're getting people through, like, make sure you're having that conversation with them, like you said. Yeah, not necessarily interview. So they get a feel for who they are. [00:21:47] Speaker B: Even if they're a great person, even if they're a great tenant, they might not be a great fit for the space where I am now, I live in a house. I have a tenant below me. I have a kid upstairs. How do you feel about a kid running around like a rhinoceros between three and six? [00:22:00] Speaker A: He's a little rhinoceros, but he is. [00:22:02] Speaker B: Allowed half of the week, right? [00:22:04] Speaker C: Yeah, that's true. You're true. That's very good. It might be the perfect person. They're like, actually, I sleep in the day, so that's not going to work for me. [00:22:11] Speaker B: That's right. I have a very important. I work for NASA from home. And if there's any noise in the house, the spaceships will crash. Well, you should not live here. [00:22:19] Speaker A: Yeah, it was dramatic. [00:22:20] Speaker C: I know, I know. [00:22:23] Speaker A: For tenants, gone are the days when they think, oh, I just apply and I get the. It's not like that anymore. [00:22:27] Speaker C: It's not like, why isn't it like that anymore? [00:22:30] Speaker A: Well, in about five minutes time, we're going to talk about a few horror stories. [00:22:33] Speaker B: Okay, I'd like to talk about it too, because. [00:22:35] Speaker A: Do you have a few horror stories? [00:22:37] Speaker B: Oh, actually, you know what? Here's what I have to say. I really do not. I really think that. I don't even want to say it's been being lucky. It's just really talking to tenants, really getting to know them, really going through all the paperwork. Also the type of rentals. I mean, there's a big difference when you're renting a basement apartment versus when you have a more executive rental. Make sure you have an executive going in there. But also they can afford. Afford it. So we've been very lucky to have all really pretty great tenants. [00:23:07] Speaker C: Like, you've done your work to mitigate risk, though. [00:23:11] Speaker B: Yes. [00:23:11] Speaker C: Being a realtor and understanding it all like you have done what you can to make sure that that happens less. [00:23:18] Speaker B: The tenants we've had that have not been good have been for a very inexpensive property. It's very inexpensive rent. [00:23:23] Speaker C: Yeah. [00:23:24] Speaker B: You're just naturally going to have people. [00:23:25] Speaker C: That are different type of tenants. [00:23:27] Speaker B: Yes. [00:23:28] Speaker A: Can we take maybe two minutes here and cover some questions that we would recommend that landlords ask potential tenants or. [00:23:35] Speaker C: That their realtor or that their realtor does their potential tenant's realtor. [00:23:39] Speaker A: Yeah. Well, there's one thing the realtor will. Will obviously speak to the. The tenant's agent. [00:23:44] Speaker C: Yeah. [00:23:45] Speaker A: Try to get information, but it's usually the introduction to have a meeting beforehand. Whether or not the landlord wants to take that person on as a tenant, not the realtor, isn't always there. [00:23:55] Speaker C: Do you have some questions? [00:23:56] Speaker A: No, no. I'm just thinking some. That you would have. [00:23:59] Speaker B: Even just a regular, like, you know, and like, do you have pets? If you have pets, great. But can you. Like, if you. [00:24:06] Speaker C: If someone lies. Why don't you tell me? If someone lies or gets weird about it and they think they need to, like, play it down, that's a red flag. [00:24:12] Speaker B: And there's a spot on the application that asks that. And I've had what people say and what they've written down be different. [00:24:16] Speaker A: Yes. [00:24:17] Speaker B: So I don't care whether you do or not, but what is going on here? [00:24:20] Speaker A: Well, you can ask, how long. How long were you at your previous rental? And, you know, why did you leave? Because that may contradict what was in the rental application. So you don't want to catch them in a lie, but you do want to kind of verify some of the stuff. Information, which we do when we do some of our due diligence. And some landlords will go ahead and do all that themselves. [00:24:36] Speaker C: You said you don't want to catch them in a lie. But we want to do due diligence. [00:24:39] Speaker A: Well, we do kind of want to catch them. [00:24:40] Speaker C: No, we don't. We want to do our due diligence. And that's how sometimes you can uncover that somebody has lied. Yeah, yeah, yeah. [00:24:47] Speaker B: Asking them about being in Toronto. You know what I mean? How long have you lived in Toronto? How long do you. Do you like it? [00:24:52] Speaker A: Yeah. [00:24:52] Speaker B: Right. It's actually kind of the same questions for like a Tinder date or something. [00:24:55] Speaker C: Totally. [00:24:56] Speaker A: How do you. Do you spend a lot of time home? [00:24:58] Speaker C: One of our clients, she interviews very thoroughly every single time we rented out her house for her. And that's something that she asks. She'll say, what do you enjoy doing at home? Do you go out a lot? And you do get. Because we've been a part of all the interviews, you do get really honest, immediate responses. And you can tell what kind of person they are from the way that they respond. [00:25:19] Speaker A: A question like that might be very important if you're including all utilities. [00:25:22] Speaker C: For example, do you work from home? If you're including utilities, important because your utility bill is going to be higher. [00:25:28] Speaker A: So there are a bunch of questions that you. That you could ask. Start the dialogue and Kind of take it from there. Depending on what your potential tenant says and answers, how they answer the questions. [00:25:39] Speaker B: And couples. And even if it's not to approve or deny, you know, how long have you been to get? I mean, also some of these questions, you don't want to overstep. Sometimes you got to feel out how chatty they are, how much they want to talk. But with a couple, you know, are they planning on having a baby next year? [00:25:52] Speaker A: Year. [00:25:52] Speaker B: And you can ascertain that they may only be here for a year. And that's kind of ideal for me. I wanted to do some work to the unit after versus someone that, well, feels like they're going to be here for a long time. Maybe that's ideal for you. [00:26:02] Speaker A: Yeah. [00:26:02] Speaker C: I can ask them specifically, like, what's your plans? Plan on staying here for a long time. And even though that might not end up being, you know, what happens because people's lives change, you'll get a sense of what direction they're heading in. [00:26:13] Speaker A: Yeah. So these are all good questions. That was a good one. Thanks, ladies. [00:26:17] Speaker B: That was a good one. Thanks for. [00:26:17] Speaker A: That was a good one. Sure. [00:26:19] Speaker C: Thanks, Nicole. Thanks, John. [00:26:20] Speaker A: Thanks, Cheryl. [00:26:21] Speaker B: Thanks, Nicole. Canadian. [00:26:24] Speaker A: Sorry. Sorry. Let's talk about attracting the right tenants. There's obviously having the property in good condition I think is important, but not all landlords do that. I remember earlier in our career, we were taking some tenant clients out to see a variety of different properties. And some of them were just in terrible condition because they had been tenanted for the last 15 years and they've gone through tenant after tenant after tenant who can be very rough on, you know, not all tenants treat the property as they would treat if they owned it. And some are in terrible repair. And so a lot of our tenant clients are like, yeah, no, because landlords. [00:26:58] Speaker C: Are just like, whatever, I'm just going to tenant it again. Why would I spend the time and money to make it better? I remember one realtor telling us in our early days, it wasn't really to us, it was just telling a story that he had recommended to a landlord client that they do fix up the bathroom because it will attract a better tenant. That way, somebody who they are looking for may not be okay with like, burn marks on the sink and holes in the wall. [00:27:24] Speaker A: Multiple, you know, like, well, that what. [00:27:26] Speaker C: It was was it was just the vanity, I remember. But he's like, yeah, just change the vanity because you will get different people who are willing to overlook that then versus somebody who wants something that's in more pristine Conditions, condition. [00:27:38] Speaker A: And sometimes people will wait until they get a certain type of. Of tenant, more ideal tenant profile. Sometimes you might have to wait a long time. Which brings me to my next point of pricing your property. Obviously it's not obvious, but we will do a comparative market analysis to see what other similar properties have rented for recently. And, you know, if they're very similar properties in condition, area, size, all that, then we can glean what market rent should be. [00:28:04] Speaker C: Yep. [00:28:05] Speaker A: Now, if you want to try to go on the higher end or the upper range of that, then you may not get as many showings, especially if there is a little bit more inventory on the market. So you may have a lesser pool of tenants to choose from. So sometimes pricing a little bit on the lower side will give you more choice. [00:28:26] Speaker C: It's important for us as realtors to learn what the most important thing is for the landlord. Is it that it gets rented quickly? Is it that you have choice of tenant? Is it that you get the most amount of money? And not all things will be true. And we can guide and advise the landlord dependent on what that comparative market analysis looks like and what perceived market rent, even the temperature of the market at that time is doing. It's similar to selling a home as well in that regard. [00:28:51] Speaker A: Absolutely. [00:28:52] Speaker B: And also that we will see, you know, asking rent was $2,000, it rented for $2,200 or it rented for 18. Asking is just asking. [00:29:01] Speaker A: Yeah, yeah. [00:29:02] Speaker C: We look at this price. Let's not call it asking. It's list price. [00:29:04] Speaker B: List price. [00:29:05] Speaker A: Because you're. Well, in renting, sometimes you are asking. You don't necessarily underprice. Although we've seen that sometimes happen, which is. [00:29:11] Speaker C: That's not even. It's happened so rarely that it's not worth talking about. [00:29:14] Speaker A: But when it does happen, our mind. [00:29:15] Speaker B: Is like, I actually haven't seen that. [00:29:17] Speaker C: Oh, we've seen it like holding offers. [00:29:19] Speaker A: Yeah. [00:29:20] Speaker C: It's written ridiculous. We were like, are you kidding with us? [00:29:23] Speaker A: Yeah, exactly. [00:29:24] Speaker C: The first time we saw it anyways. Because we've seen it maybe like three or four times. [00:29:27] Speaker A: Yeah. And then that's where they let all the people come on the one day do the. All the interview and whoever's going to give them the most amount of money potentially and they think is the best fit. [00:29:34] Speaker C: There was no interviews with the first one we did. [00:29:36] Speaker A: There was one of them. [00:29:36] Speaker C: They had an open house. [00:29:37] Speaker A: Yeah, yeah. [00:29:39] Speaker B: Anyway, I refer to leasing as the underworld of real estate because of stuff like this. You'll see this stuff. You're like, what Are these people people thinking and poor tenants in Toronto, God bless them, are just trying to find an acceptable place to live at a normal price. [00:29:53] Speaker A: Yeah, exactly. So I feel for, for the tenants, but you know what, I also feel for the landlords as well because tenants have a lot of rights and I think it's great. But I'm not sure. There has to be kind of a balance and we'll, we'll touch on that. [00:30:07] Speaker C: Yeah, we can tell if we want to talk about bad tenants. I know you probably have stories there. I have a family member. [00:30:13] Speaker A: Oh gosh. [00:30:14] Speaker B: Yes. [00:30:17] Speaker C: But we won't talk about that. [00:30:18] Speaker B: Okay. [00:30:19] Speaker C: John has a list and plus there's been so much in the news as well that we can talk about. [00:30:24] Speaker A: Yep. And we will. [00:30:25] Speaker C: What could happen? [00:30:27] Speaker A: Let's talk about raising the rent. [00:30:30] Speaker C: Okay. [00:30:30] Speaker B: Raising the rent. [00:30:31] Speaker A: Raise the rent. [00:30:32] Speaker B: I know I wanted to do this. [00:30:33] Speaker C: Year 2.5% the allowance if your condo or your home was not built before November 2018. [00:30:42] Speaker A: That's correct. So if your property was not lived in or brand is brand new as of 2018, November, you can raise your rent amount by any reasonable amount that is supported by current rental market rates. Meaning that you know, if you are. [00:31:00] Speaker B: Not rent controlled, if you're not rent. [00:31:02] Speaker A: Controlled and non rent controlled building buildings in Toronto where the stipulations are that it was built November 2018, that doesn't mean that you can raise your rent on your tenant after their first year term is, is up by like 100%. You can't double it just to try to get them out. It has to be supported. Some people will do try. Okay, go ahead and have. [00:31:26] Speaker C: So the, the word reasonable is in. I think the rule and I think that that's what you're trying to get at that you know, doubling a rent isn't reasonable. But we have definitely seen and spoken to tenants where their landlord has tried to raise the rent an enormous amount of money and then they give their notice and leave because no, I'm not going to pay that. [00:31:47] Speaker A: Yeah. [00:31:47] Speaker C: I think that the reasonable part though is that say a land and some of that's subjective. Reasonable. Right? [00:31:53] Speaker A: It is, it is. [00:31:54] Speaker B: So we're going up fast. Not now, but. [00:31:57] Speaker A: And what are you going to do? Take it to the landlord. And that's how you. [00:32:00] Speaker C: That's exactly what you have to do, which makes it difficult. And I think that I've seen landlords use this as a tactic to try to get a tenant out. [00:32:08] Speaker A: That's right. [00:32:08] Speaker C: Right. Like I'm going to raise you around X Amount of dollars. Okay, well, technically, that isn't reasonable. So now the tenant has to take them to landlord and tenant board, which is, you know, backed up by a year, and it becomes a big headache. So why not just leave? [00:32:19] Speaker A: It's a bit of a broken system. [00:32:20] Speaker C: Yes. [00:32:20] Speaker B: I've had this happen. I'm sure you guys have, too. A number of tenants we've placed in places. Something like this has happened, where the landlord now wants to really raise the rent, and the tenant circles back around and reaches out to us as a tenant representatives. I say the same thing every time. I say, you know what? Why don't you negotiate with them? Have you been a good tenant? Have you paid your rent on time? Yes, I have. In every case where this has happened, the tenant has then come back, negotiate with the landlord. And I think in every case. Many cases have been a very happy win, win. Some have been a tenant begrudging, but still win, win. [00:32:49] Speaker A: And they come to an agreement. [00:32:50] Speaker B: That's right. That's right. So talk to your landlord. [00:32:52] Speaker C: At the end of the day, that's what usually needs to happen, is agreement. It can't be a landlord that's, you know, trying to be. What's the word? When you're trying to push the bully, I guess. Like, it can't be a landlord trying to bully their tenant, and it can't be a tenant that just, like, digs their feet in the sand. Like, there has to. You're living in someone else's house, and you like this tenant, and they're good. Like, let's see if you can come together to something that's agreeable for both of you. [00:33:16] Speaker B: Because good tenants are hard to find. [00:33:18] Speaker A: Good. [00:33:18] Speaker B: Paying your rent and you've been good. Your landlord wants you to stay. I promise you. [00:33:22] Speaker C: And we guide our landlords the same way that if they have a tenant that they're trying to raise the rent and the tenant's pushing back, we say, well, this happened a lot in Covid. Negotiate with them. Find out what the situation is. Do you like them as a tenant? You want to keep them? Then do what you can to try and bring something together. [00:33:36] Speaker A: Yeah. Over the years, one of the things we've realized is that having a really great tenant is sometimes more important than how much they're paying. [00:33:42] Speaker C: Yeah. [00:33:42] Speaker B: Yes. [00:33:43] Speaker A: Yeah, yeah. For sure. They're taking good care of your property. You know, they're paying every single. You know. Yeah. Month on time. [00:33:50] Speaker C: They're nice humans. [00:33:51] Speaker B: They help take out the garbage. [00:33:53] Speaker A: Yeah. [00:33:54] Speaker C: That's a. Nicole specific. [00:33:57] Speaker A: Let's talk Then about the landlord and tenant board. Very quickly, before we talk about, I want to talk a little bit about investors and cap rates. [00:34:05] Speaker B: When do we get to horror stories? [00:34:06] Speaker A: Oh, that's next. [00:34:07] Speaker B: Okay, I'm sorry, I'm excited for that part. [00:34:09] Speaker C: Before you move on there, just so we're clear, raising the rent, if it's a building or a home. [00:34:15] Speaker A: Oh yeah. [00:34:15] Speaker C: We didn't even talk November 2018. There is always a posted rate that is in line with inflation. The last few years it's been 2.5% I think before COVID one of the years was 1.2%. So it's not very much. But there is that allowable rate. Your landlord once a year at the end of every year with proper notice. With 90 days notice in a written proper form. Yeah. And it's from the landlord tenant board can raise your rent legally and, and then anything. November 2018, 18 onward, the process is the same of the proper forms and 90 days notice, all that. But then it's a little bit more. [00:34:46] Speaker A: Wish there's no rent control. They can, they can raise it considerably higher than that posted rate, let's put it that way. [00:34:52] Speaker C: And people need to also this is another thing that if you have a realtor, they'll help guide and advise a tenant going into a property. Hey, FYI, this isn't rent controlled. So just know your landlord can do X, Y and Z and this is how we would deal with it. But please contact us at the end of the year if they try. [00:35:07] Speaker A: Yes, sure. Let's talk about the landlord and tenant board because if there ever is any, you know, issues that the tenant has with the landlord going against the Residential Tenancies act, then your first line is you can contact the Landlord and tenant board to get information, to get guidance. And if you're a landlord and there are things like damaged property, not non payment of rent, you have to go through the landlord and tenant board to either try to get the, the problems rectified, be it collecting back rents, be it whatever it may be, and or go forward with the eviction. Eviction process. And it does take a long time. They are extremely backed up. Tenants have a lot of rights. Yeah, a ton of rights. More than landlords do. Like they hold more power and some do abuse more than they know. Yeah. And some do abuse that power. They're, you know, we call them professional tenants. We've seen them in the news a lot recently in one case in particular that we're going to talk about. So we don't want to scare Anyone away from being a landlord. [00:36:10] Speaker C: But you gotta, you just have to. [00:36:12] Speaker A: Be knowledgeable that these things there is risk with anything. [00:36:15] Speaker C: And also why you try to mitigate the risks and everything we've talked about previously. [00:36:19] Speaker A: Yeah, so we're seeing a lot of investors actually get out of the market. There's not as many investors buying pre construction. Many are selling their tenanted units because it doesn't make as much sense with the. What was the current landscape for rates? I know those are on their way down. So it's definitely softened the demand for the condo market, made it more to a buyer's or balance to buyers market. And here's the reason why. In the past, many years ago in Toronto has been many, many years ago, you used to be able to put 20% percent down and buy a property and have the rent cover your mortgage, your insurance and your maintenance fees. That's not the case now. The cap rates are currently about 4% in Toronto, which is the capitalization rate. You want to look that up, that's fine. We're not going to get too far into that. But that means that you're going to be subsidizing, you are going to be out of pocket. Your rent might be 2000, which might cover your mortgage, but then it's not covering your insurance, it's not covering your maintenance fees, property tax, property taxes. So. And investors used to be okay with that because they were gaining money on the appreciation of the property when it was going up 5 to 10% per year, you know, compounded annually. Sure. If you hold for quite a while, then you're going to make money just on the property appreciating and having the tenant pay part of your mortgage. [00:37:35] Speaker B: And your principal and rents were going up quite rapidly as well. [00:37:37] Speaker C: Yeah, $10,000 out of pocket. In the big scheme of things, you may have earned well more than 10,000 on that overall purchase. [00:37:45] Speaker A: In order to break even, you're now having to put like 30% or more down. And so it just doesn't make sense for a lot of investors, a lot of small landlord investors. So I just wanted to touch on that. However, for some people, if they have, if they're sitting on some capital and they want to maybe put a little bit more than that 20% down or okay, kind of breaking even, hold on to a smaller property and use that as an investment vehicle. We do help investors, so feel free. [00:38:10] Speaker C: To contact us also. I think it depends on who the investor is too. We have a lot of our clients who are holding on to properties to Give to their children when their children come of age. You know, they have small children. They bought a condo that they're renting out now. But the end goal is to have a place for their child to go to. [00:38:26] Speaker A: Yeah. Are you ready for horror stories, ladies? [00:38:29] Speaker B: I forgot. I've been waiting. I see it on my paper and I. [00:38:32] Speaker A: And here we are. I want to talk about somebody that was in the news recently, and this goes all the way back to 2020. A couple bought a unit over at Humber Bay Shores, and they wanted to hold on to it as an investment for their retirement. They got a tenant in there. She paid for something like the first seven months, no problem. But then didn't pay for about nine. Caught up. Anyway, it's been back and forth and back and forth. [00:38:58] Speaker C: It's been in the news multiple times about the course of the last six months. [00:39:02] Speaker A: And it finally. Just. Finally they got her out. And they had to get the sheriffs in there to. That's the last. That's the last line of defense after everything is exhausted to the landlord and tenant board. And this poor guy went through years of this. He was out $55,000 at the end of the day. That did include her unpaid rent, unpaid utilities, repairs, and the cost of removing the items that the tenant left behind after. [00:39:27] Speaker C: She didn't leave it behind. It's because she was removed. She didn't have time to take it. But she hadn't packed anything. Like, there were boxes in there that were unpacked. [00:39:34] Speaker A: And, you know, I saw her a few times being interviewed prior to this most recent time when she ran away, and it was just. It was. [00:39:41] Speaker C: So she wasn't actually being interviewed. [00:39:43] Speaker A: They were trying to. [00:39:45] Speaker B: Yeah, but she ran away. [00:39:47] Speaker A: She just knew she worked the system and. [00:39:49] Speaker B: Yes. [00:39:49] Speaker A: And it's not like this. These. They're these big, bad landlord companies, corporations. This. A small investor. This is. They own a home and they bought this condo so that they could have that potentially for their retirement. If you Google tenant horror stories in Toronto or in Ontario or in Canada or anywhere, the list is kind of endless. Yeah. [00:40:08] Speaker C: So we saw this story on Global News, Sean O'Shea. [00:40:11] Speaker A: Yeah. [00:40:11] Speaker C: And he also had another story, I believe, up in Brampton where the family was trying to move back into their home and the tenant was refusing to leave and then refusing to pay and was letting the news, like, speak to them. [00:40:23] Speaker B: Not running away at the interview. [00:40:24] Speaker C: Not running away, but being very aggressive. Like, it was gross. They were allowed to stay there. And it's their house. [00:40:29] Speaker A: This is my house. [00:40:30] Speaker C: Yeah. Like, it was brutal and to the point that you were trying to make, too, is that there is an idea that it's landlords are bad, but there are tenants that are bad as well. [00:40:41] Speaker A: That's right. [00:40:42] Speaker B: And I mean, landlords are bad. It's been painted with a brush. But we need. Tenants need landlords. Like, all the landlords are evil. So we'll push them all out, and then there'll be no one to rent places to tenant. I mean, we. We've all been in positions in life, like, where we need to be a. [00:40:56] Speaker A: Good person on both sides. And you should be okay. Right. And I feel for a lot of the tenants. There's some tenants that are taken advantage of by their landlords raising rents, and they don't question it, they just go ahead and pay it. It happened to a friend and client of ours, and it's. That's not good either as well. Well, having a property being in terrible condition with mold, with. Yeah, with no heat. Yes. [00:41:18] Speaker B: Those are difficult things. [00:41:20] Speaker C: You said tenant horror stories, but we could have an equal amount of landlord. [00:41:23] Speaker A: That's what I mean. Yeah. So I'm talking about the landlord horror stories. [00:41:28] Speaker B: No, no, I've had good. [00:41:30] Speaker C: Not you personally, but that you've heard. [00:41:32] Speaker B: The only horror story I can think of is like my original, the worst real estate story ever, where I walk into the apartment, the orgy where someone's having an orgy, but also concurrently, there is dog feces and urine everywhere. [00:41:45] Speaker C: Oh, yeah, those are bad tenants. [00:41:46] Speaker B: That was a rental. Yeah, that was a rental story. [00:41:51] Speaker A: And, you know, with tents, there are some tenants that can be good in some ways and not great in others. [00:41:55] Speaker C: Yeah. [00:41:56] Speaker A: And, you know, I know of one. [00:41:57] Speaker C: In particular that pays on time, is very nice, lovely person, but terrible to the unit. [00:42:02] Speaker A: Yeah, very. Yeah. [00:42:03] Speaker C: Just dirty and not careful. [00:42:05] Speaker A: Got a dog without letting their landlord know. You know, things like that. So not. Not naming any names. [00:42:12] Speaker B: It happens. [00:42:13] Speaker C: Yeah. [00:42:13] Speaker A: All right. So another horror story that I've heard of a couple times is when somebody buys a property as an end user and it's tenanted, and then the tenant just refused to leave. So it's that we're seeing more and more of that because tenants know that they have rights, and it's just become such a headache and a hassle, and if you have to assume that tenant, it messes up your. Potentially your mortgage, because then all of a sudden, you're an investor. There just can be a lot of things involved with trying to purchase a tenanted property if you are an end user. So make sure you get good guidance and advice from your realtor and. Or lawyer and. Or both if you're looking to purchase a tenanted home. [00:42:49] Speaker C: So you keep saying tenants have a lot of rights. They don't have the right to ignore you, to stay, to not pay, none of those. But they make it difficult because then you have to go follow the right steps going through the landlord and tenant board to rectify the thing that they're doing that isn't right, that is not within their rights. Are you going to be speaking about dogs? When you mentioned that, it made me think about pets. Just the generalization. Is there anything in here? No, no. [00:43:14] Speaker A: But you can go ahead, Gerald. [00:43:16] Speaker C: Pets are allowed. You can't say no pets. [00:43:19] Speaker B: Except when the condo declaration states that a pet must be within a restriction or if there is a combined H VAC system in a single family home and someone's allergic. Someone is allergic. [00:43:31] Speaker C: Yeah. And those are not gonna happen very often neither. [00:43:34] Speaker A: And it's funny, you can say you can't say no pets, but look at the listings out there. There's a lot of listings that say no pets. [00:43:39] Speaker C: But I'm just saying you can't say no pets. People do. [00:43:42] Speaker A: People do. Yeah. And when landlords are interviewing, you know, do you smoke pets? [00:43:45] Speaker C: That is where it comes in, is that if a landlord doesn't have a preference, and almost, almost all of our landlords say we don't have a preference, but we are open, and they'll maybe accept a dog that is small and not loud or one that doesn't shed or, you know, like the dependence on the dog and the age of the dog and all of that stuff. [00:44:01] Speaker A: Yeah. [00:44:01] Speaker B: I do want to say, if you're renting in Toronto, please do not get three German shepherds and a Rottweiler. [00:44:06] Speaker C: Try to get into a condo, guys. Yeah. [00:44:09] Speaker B: Or anywhere. Like, it's just at this point, you have a small farm. You know, our hoses are not meant for this. [00:44:14] Speaker C: People with a lot of pets. It's going to be more difficult to rent for sure. [00:44:17] Speaker A: Absolutely. Let's talk about helping potential tenants now. Okay. We've covered landlords. Once again, if we're going to give our tenants a good piece of advice is have all your ducks in a row, get a complete package together. Fill out that rental application in full. See if you can get, you know, a full Equifax report, because I know it's not. Make sure you get one is how I should have worded it, because do. [00:44:42] Speaker B: Not screenshot your credit karma and send it to somebody, your name's not on there. We have to prove that it's yours. Right. [00:44:48] Speaker C: And MyEquifax CA Credit Karma has actually the least usable downloadable PDF. But MyEquifax, CA and Borwell, which is they take the information from Equifax. They have really easy printable PDFs. [00:45:04] Speaker B: Please do that, please, please. So we got the Equifax credit report with score. [00:45:09] Speaker A: Yes, please, please. Proof of income. So that would be pay stubs, employment letter. [00:45:16] Speaker B: You need both. So you, if you have a job, you need an employment letter and you need the pay stubs 2 to 4 recent pay stubs substantiating what it says in the letter. If there is a discrepancy, the most recent ones from the time that you're applying for the unit. Yeah, if there is a discrepancy, sometimes that happens. But just have a reason for what was it year end and maybe you were paying into some bonus, whatever it is, but have a story. Do not just randomly send pay stubs at. [00:45:42] Speaker A: And if you're. If you're not being paid bi weekly or monthly and you're not salary more commissioned or you're an entrepreneur or anything like that, just make sure that you have a lot of supporting evidence to show how much money that you earn and have earned for the most recent period of time, preferably the last couple. [00:45:59] Speaker C: Years, you have the better helping everybody. [00:46:02] Speaker A: Yes, and I just cross that out because the more information, the better. Is great for. For everything, right? [00:46:08] Speaker B: For everything. [00:46:09] Speaker A: Yeah. Let's talk about pre qualifying. We didn't really talk about that with when we're taking on any potential tenants that may be reaching out to us, one of the first things we'll do is find out how many of them are there that are looking to rent a property. [00:46:26] Speaker C: Do you want to ask because she's dealing with a renter right now. How do you pre qualify before you decide whether or not you can help them? [00:46:33] Speaker B: So the first thing is we ask for all of these documents beforehand. And I will say right off the bat, sometimes we have tenants that have pushback with that. Well, I'm not ready to apply yet. Well, are we going to apply within the next month? Because if. Yes, send this to me. A. Because we work with landlords and tenants, we can look through the package and see if it does or it does not make sense. Maybe supplemental information will be needed. Maybe it will take time to get that supplemental information. So what we're doing is tenant representation is making sure that your tenant package is the best the strongest it can be. And all the information is there. People are not aware of how long it can take to get some of these documents. If I have them, then I know exactly that we have it all. I know it's the correct ones and I can make sure it all makes sense before we send it to somebody else. [00:47:15] Speaker A: And if they're not sending that to you and they're pushing back, are you going to show them the property if they refuse? You're, you're too nice. [00:47:23] Speaker B: I'm too nice. Usually I'll show one. Like, if they're like, oh, you're. And I get this often, oh, you're right. It is going to take me more than like five seconds to get this document. And we already have the showing. [00:47:32] Speaker A: Well, I want to make sure that they're employed, that they weren't evicted, that they don't have a credit score. [00:47:37] Speaker C: So I'm going to qualify qualifying. So you have a phone call beforehand. So what is it that you're looking for? What's your timeline? What do you do for work? Approximately how much do you earn? Like, ask those questions up front and then say, okay, here's all the paperwork I need from you and this is what the process looks like. Right. [00:47:55] Speaker A: We, we do that a lot when we're representing landlords and we get people that aren't represented and they reach out to us because we've had a one plus den unit before where the den is literally a tiny little nook and they were trying to get a family of four into the property. So it's, it's sometimes, it's sometimes difficult to, to do that and you wanted to feel for the tenants, but it's up to the landlord. At the end of the day, I don't want to have four people. And sometimes condos won't even allow the number of occupants to exceed a certain number, depending on how many bedrooms. So, so things like that. I think it's very important that landlord, sorry, the potential tenants are coming to us whether or not we have the listing or not, that we do try to pre qualify them. Yeah. [00:48:37] Speaker B: Yes. [00:48:38] Speaker A: And you know what, if their credit is terrible or if they don't necessarily have a lot of steady income and we don't know if we're going to be able to represent them or it's going to be much too difficult, then we will sometimes give them a lot of information as to how they can help themselves off market. [00:48:58] Speaker C: Yes, we all will say, if a tenant comes to us and say, I'm looking to rent and Want to move in a month. I don't have a job right now. And we say, you know, working with a realtor, you're going to pretty much be turned down everywhere, you know, if you don't have a job yet. But here are some things that you can do to help yourself if you don't get that job. If you do get that job, like, here's the steps and that we can help you with. Here are a bunch of websites that is more off market, landlord to tenant. Because landlords will sometimes judge based on meeting you face to face. And you've seen, like, a really good person who's on a good path to getting that job. And here is all the information you're probably going to need to provide to them. Here are the things that you can do to help yourself get a rental on your own. And when it comes down to it, we're still here, too. If they ask you to sign something, let us take a look at it. We can tell you if it's in line with the Residential Tenancies act or a scam. Yeah, don't send any money to anyone without seeing the place without getting a key. Like, we've had a tenant client get scammed. Scammed. And it was heartbreaking to hear this. [00:49:56] Speaker A: Story first and last. Gone. [00:49:58] Speaker C: Yeah, like, and he called it. He emailed me immediately after sending the money and asked. And I said, no, that was a scam. That was a scam. Like, can you get it back? And then he called the cops within that hour and the cops were like, sorry, buddy, it's gone. [00:50:09] Speaker A: So just be very careful. If you're a tenant and you're going to Facebook, Marketplace and. Or Kijiji, Craigslist, if you're asked to send money before even seeing a property, or if they're shown a property and they ask for money before you get any keys, if it, if it seems like it's not on the up and up, there's a good chance it's not. [00:50:26] Speaker C: If it looks too good to be true. [00:50:28] Speaker A: Oh, yeah, absolutely. [00:50:29] Speaker C: But we will guide and advise somebody who doesn't maybe meet the criteria of what we know landlords using realtors are using to be able to help them. Because in the day, like, that's her job, right? To help people. And sometimes we do things for free and sometimes we do things of the goodness of our heart. [00:50:44] Speaker B: And so, yes, I would like to take this opportunity. I've been thinking since the beginning that I would like to say that we make fun of leasing a lot of time because it is the underworld of the real estate industry. And, you know, we make jokes, but the point of fact is we still all do leasing because it is very important. It's important to us to help people find home. [00:51:02] Speaker A: Absolutely. [00:51:03] Speaker B: We're really not making a ton of money on it. It's barely covering our costs. We're still doing it because it is important. And there are a lot of ways we can help and we do want to help experts. [00:51:12] Speaker C: Right. And so, like, if we have that information, why not help people with it? [00:51:16] Speaker A: Yes. Sometimes we're unable to help just because we don't have the bandwidth. There is only so many hours in the day. And if we are currently servicing a lot of buyer clients or have number of listings and somebody comes to us and needs help as a tenant, we will usually be able to refer them to someone. We can. [00:51:33] Speaker C: Yes, we will. [00:51:33] Speaker A: And we will pass in. We have a lot of great colleagues that are happy to do leases that may not be as busy by choice and. [00:51:41] Speaker C: Or live in the area. [00:51:42] Speaker A: Exactly. So if you are, you know, in that scenario and you're looking for help. [00:51:49] Speaker C: We always can find someone. [00:51:51] Speaker A: Exactly. So please feel free to reach out to us. You know, even if your profile is not great, for whatever reason, don't try to hide something. Right. If you've got bad credit and it's 600 because you consistently missed your Rogers payment, say it. You know, just say it. Because there's people, there's people that have 100 grand in the bank, don't carry a lot of debt, but they, they miss every other month because they're stupid or lazy or whatever it might be. Anyway. No, no, but you know what? Because they're not good with finance, they're not organized. Yeah, John, I know, that's me. My credit score went up when I met Cheryl, let's put it that way. [00:52:26] Speaker B: But in particular, if you have tenant representation, tell your tenant, your realtor, because if you send that over to them, we're going to help make the application more suitable. Like, okay, you know what, you may have to pay a few more months up rent. Yes. Landlords cannot request that. But if a realtor looks at your tenant profile and sees like, oh, this might be a bit tricky, you may want to volunteer that. We would recommend that. [00:52:47] Speaker A: Maybe you want to volunteer again, it's not required. But if you want to volunteer and it's going to help you secure the property, then why not? Why would you not do that? [00:52:53] Speaker C: Realtors can guide and advise you on things you can do to strengthen your offer. And a Lot of what you can do to strengthen your offer is not necessarily something that can be asked of you, but it is something that you can do in order to help strengthen if you're comfortable with it. Again, it's a win win. Right. You want the landlord and the tenant to come together for a win win. They feel like they're protecting themselves. You got the place you wanted for the price that you wanted or whatnot. And Bob's your uncle. [00:53:21] Speaker A: Bob is your uncle. [00:53:22] Speaker B: We have somewhere to live. [00:53:24] Speaker A: I think that that kind of covers most of it. Do you ladies have anything else you wanted to kind of add before? Before we talk about our takeaways? [00:53:33] Speaker C: No, no, no. Didn't you hear the sigh? [00:53:37] Speaker B: I feel like each one of these we could have gone on so much more, but I'm not sure it's actually helpful. It's just a. It's a complete information. [00:53:44] Speaker A: We could go on and on and on and on, but we're not gonna. We're gonna keep it short. Ish. If you have any questions, always feel free to reach out. We're more than happy to provide you with information. [00:53:54] Speaker C: All of our clients, whether you're a buyer, a seller, an investor, a renter, whether it be a landlord, a tenant, if you ever have questions about anything real estate related, including the residential tenancies actor, what you can do, reach out to us. [00:54:05] Speaker A: Exactly. [00:54:06] Speaker C: We are experts. [00:54:06] Speaker A: We're here to help. [00:54:07] Speaker C: We have the information. We are here to help. [00:54:09] Speaker A: Yeah. So I think the takeaways. If we're going to go through all the notes. You wanted to say something? [00:54:12] Speaker B: Well, I just see your little. It's in your notes here. The. Did you know? [00:54:15] Speaker A: I know, but we covered that though. This is interesting. I wanted to finish that with an interesting tidbit. Did you know not all realtors do leases? Some just will not facilitate it. They may refer that out to someone else. But I don't know a lot of agents that don't. They concentrate mostly on buying and selling or working with investors. Maybe not on the rental side and. [00:54:34] Speaker B: Not all cities and areas. [00:54:36] Speaker A: That's right. [00:54:36] Speaker C: That was the next thing. [00:54:37] Speaker A: Because you covered that as well earlier. [00:54:39] Speaker C: In getting ahead of the game. [00:54:41] Speaker B: I'm just, you know, and in some cases, like in British Columbia, this is not even in New Brunswick. This is not a thing. They're not allowed on the mls, but we have many places in Ontario. Just speaking to my realtor friend in Petawawa, it's Ontario, they could be on there. She said, I've never even seen a lease. I've never done a lease. It's not. It's just not part of the landscape there. [00:54:57] Speaker C: Or there's certain places like let's say Peterborough or Prince Edward county, where some do it because they have the knowledge of the Toronto market doing it, but not everyone does it. So your chances of finding a rental may be lower using a Realtor because there's smaller percentage of landlords who use realtors to list their properties. Yeah, it's definitely different, depending on where, price point, what persons. [00:55:21] Speaker A: Yeah. And just even here in Toronto, it's like every single transaction is different. Every property, every tenant. There's no one size fits all for qualifying. And the best thing you can do is reach out to your agent. Another great thing you can do is get yourself familiar with the Residential Tenants act, have a read through, do the Kohl's notes. It's available online both for landlords to know their rights, for tenants to know their rights, for Realtors to know that so that they can explain what the rights are both to landlords and tenants. I think it's very important. [00:55:52] Speaker B: And even just that's quite an exhaustive document. But just reading the Ontario Standard Lease, it has those pages in the back, the appendix, and there's a lot of good, more customer facing, briefed information in that. Just reading that's going to give you a great idea. Yeah. [00:56:05] Speaker A: Plain English, right? [00:56:07] Speaker B: A plain English version. [00:56:08] Speaker C: I love it. I sometimes will send it to our tenant or landlord clients and say. Have a read through before you're agreeing something. Yeah. Can I say overarching what you can do when using a realtor to represent you, whether you're a tenant or a landlord, is really. You're having somebody who can assist you, help facilitate the entire process, who can guide and advise you and help protect your rights, who can remove a lot of the stress from the process. And I think at the end of the day that is where we see it help more of our tenants and our landlord clients is that it's such a stressful process and it can be very overwhelming and we help to make sure that that is less so for you. [00:56:46] Speaker A: If you want someone to do the 423 pages of documentation and paperwork, we gotcha. [00:56:52] Speaker C: Thank goodness we store all that on hard drives. [00:56:54] Speaker B: I was going to say another thing. [00:56:57] Speaker A: I want to stress is that a good tenant may be worth more than money. That's a good, I think, takeaway that you should interview tenants. Most definitely. If you do have the chance as a, as a landlord trying to attract the right tenant, it's going to be helpful if your property's in good condition and, you know, do the due diligence so that you don't get burned a little bit later down the process. [00:57:21] Speaker C: On either side. [00:57:22] Speaker A: Yeah, on either side. [00:57:23] Speaker B: On either side. [00:57:24] Speaker C: Yeah. [00:57:24] Speaker A: That's it. All right. So that brings us to an end of our Leasing 101. As always, we're going to do a little bit of support local. Typically what we do is we feature a specific business in Toronto in our neighborhood. But I want to take a moment to shout out a very special organization that we work a lot with and it's the Riverside BIA. Yes. We live in Leslieville and we're the Scott McGillivray trusted agents at Leslieville. Riverside is just the next little neighborhood over and we've been working with them since 2018. And there's a lady there by the name of Jennifer Ley who is, I think, one of the best in the entire city. She's the director of the bia. She does so much to support all the thriving local businesses. And there's a lot of smaller independent businesses on that Queen street east stretch. We're honored to be working again with her this year to do a little Good in the Hood series. We're shooting five videos for five businesses. [00:58:14] Speaker B: Do you want to share with us the one that you did yesterday? [00:58:17] Speaker A: I do. It's the Lemon Lily. [00:58:19] Speaker C: Okay. [00:58:20] Speaker A: They're a really well known operation that makes tea. Makes their own tea. [00:58:25] Speaker B: I'm super into tea these days. Doing Dry January. You do the Dry January with an asterisk. [00:58:30] Speaker A: Oh. [00:58:32] Speaker B: But I am just drinking at like social functions on weekends and so I am like pounding herbal tea. [00:58:37] Speaker A: Oh, I thought you were saying I'm pounding on the weekend. [00:58:40] Speaker B: Don't call me and ask me to do a lease. [00:58:41] Speaker A: So check him out. His name is Jason the Lemon Lily. They've got a huge selection, massive following on Instagram. They do a lot of online stuff, but this is their only right now in person. Bricks and Mortar Cafe and lovely little spot on Queen Street East. So go and check them out. So. So thank you to the Lemon Lily and future businesses. I'll be shooting later this week, but most. But mostly thank you to Jennifer Ley of the Riverside bia. You're doing some great work out there. And that brings us to an end. As always, you can find out more about us, including all of our previous podcasts@therealestatepodcast ca if you go to all of our socials. It's nctorontogroup. That'll be Instagram, Facebook and YouTube. If you want to enjoy our podcast to its fullest extent, then go to YouTube so you can see our stupid funny faces. All right, thanks again, Nicole. I'm sure we'll have you back on the podcast again for a future episode. [00:59:34] Speaker B: That would be fun. [00:59:35] Speaker C: As a guest. [00:59:36] Speaker A: Yeah, as a guest. As our guest speaker in charge of leases. No, just kidding. [00:59:41] Speaker B: I know, I know, but it's true. [00:59:45] Speaker A: We look forward to bringing many more of these to you this year. Bye, everyone. [00:59:52] Speaker C: Bye. [00:59:55] Speaker A: You have been listening to therealestatepodcast. Ca. Visit our website for more episodes and follow us on Instagram, Facebook, and YouTube @jnctorontogroup.