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Should You Really Become a Landlord? (Especially in Ontario)

November 25th, 2012 · No Comments · Rental Property

It Looks So Easy, But Think Twice Before Investing and Becoming a Landlord

Mortgage rules are getting tougher. In many areas sales are down and prices dropping, especially in Ontario outside of Toronto and the Greater Toronto Area (GTA).

Isn’t Now a Great Time to Become a Landlord?

It looks like a great time to buy a rental property. You can get a good price and rent out to people who can’t get a mortgage! What can go wrong?

Yes, the Marketplace Looks Great!

Yes.

There are also many foreclosures for sale and the banks are eager to sell at a good price.

What Can Go Wrong?

There are a number of things potential landlords should be aware of. This is especially true in Ontario.

Here is a list of red flags potential landlords need to be aware of.

#1 Vacancy Rates

In many areas in Ontario vacancy rates are rising. Did you know the Canada Mortgage and Housing Corporation (CMHC) doesn’t count private small landlord rentals as part of their statistics. I know it’s amazing, but they don’t. They skews their data and makes their published vacancy rates not only useless, but misleading.

#2 Tenants Applicants are Getting Even Worse

As the economy sours, more and more tenants have bad credit and even recent bankruptcies. It’s very important for landlords to do careful tenant screening, including a credit check.

So a credit check and an employment check, both of which are so important to protect yourself) might disqualify everyone who applies for your rental property! What do you do then? There are a lot of bad tenants out there all over Canada. 

Even in growing Alberta.

And in British Columbia.

#3 Evictions Take a Long Time All Over Canada, Especially in Ontario

Evictions in Ontario take at least 3 months.  And a savvy tenant can prolong them to be over a year! Are you ready to pay your mortgage without any rent coming for a long period of time. Bad tenants are out there and they can cause you lots of trouble. If you face non-payment of rent, or worse, you should seek professional help.

Do You Really Want To Be a Landlord? Make Sure You Research Carefully!

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