September 16th 2024
In the last two or three issues of these Money Machine articles, we’ve taken a look at the growing problem between landlords and tenants especially when evictions, either ‘fault’ or ‘no-fault’ come into play. We’ve seen why economically tenants feel they are in the driver seat and why the Landlord and Tenant Board in many ways contributes to the problem. And while we outlined what needs to be done to remedy the problem, until changes are made, landlords need to be doubly sure that they don’t make a mistake that could have been avoided during the tenant selection process.
In the case of month-to-month tenancies or at the end of a fixed term lease tenants are required to give 60 days notice of 
their intention to terminate. The idea is to give the landlord ample opportunity to re-rent the unit during that notice period and avoid loss of rent due to vacancy. Personally, I tend to wait until the tenant has vacated before I advertise the unit or dwelling for rent. I do this merely for convenience. I find it difficult to work around the existing tenant’s schedule for showings, especially when so often perspective tenants do not show up for their scheduled appointments. But that is merely for my convenience. Unlike the 24-hour notice requirement for showings when a property is being sold, all that is required is a reasonable attempt on the landlords part to contact the tenant to inform them the unit is about to be shown.
I’m a big believer in delegating when it comes to rental management. I don’t personally attend for example when repairs are required. I send a tradesman. I’m looking for an investment when it comes to rental real estate. Not an additional job. But the one exception is tenant selection. I always do that myself. I want to meet these prospective tenants. Try to get a general first impression, right up front.
So, it begins by advertising the unit for rent. Either on Facebook Marketplace and/or on Kijiji. I meet the prospects on site, either one at a time or I ‘batch’ appointments almost like an open house. I have prepared rental application forms, which I 
give to each interested party. I ask them to complete the form if interested and drop it off or email it to me. Now the form contains a lot of information. Name, date of birth and social insurance number is needed if you were going to run a credit report. Current and past employment history will give you an idea of stability and affordability of the unit and also will be handy if you ever have to get into collections. Of utmost importance to me is past rental history. How long have they lived in each past rental? How often did they move? What prompted each move? And contact information for current and past landlords.
If the tenant has moved frequently and/or stayed in one place for only a short period of time, I’m going to pass on the application. They might tell me they want to stay long-term - this will be their ‘forever home’. But if they have moved every 6 months in the past, they are going to move in the next 6 months again. I’m always interested in long-term, and while there are no guarantees, you can go by past performance more often than not.
Go over the application carefully. Be picky. If you have doubts, pass and wait for a better one. I’ve found it helpful to tell people when they submit an application that if their application is approved, they will hear within 2 days. I don’t want to get into telling an applicant they are turned down if I can avoid it. Then the conversation becomes a defence of your decision and that can quickly be interpreted as discrimination. Who am I to decide that a couple with 3 kids would be underhoused in my 1-bedroom unit or a person with gross income of $30,000 can’t realistically afford $1,800/month. Those are valid considerations from a landlord perspective but better not to have to explain those criteria. They didn’t hear back within 48 hours. They were not successful. Take your time. Go through any and all applications and don’t select one until you are very comfortable with your decision. Better to carry a unit vacant for a month or two rather than rent it to a bad tenant who will be a problem and you’ll end up having to evict.
Do your homework. Absolutely imperative that you speak to current and past landlords. Any hesitancy on their part needs to be cross questioned thoroughly. And if as is often the case, the applicant is coming from home ownership and the property is perhaps being sold due to marriage break-up, talk to the realtor. Find out how the home showed and how the person was to work with.
Take time to look at where they are now living. Drive-by or at least check it out on Google Earth. Especially in the case of a single-family rental, assess how this current property looks. If the yard is full of weeds and the property is poorly kept, that’s an application you don’t want to consider.
And a further word of caution. There are prospective tenants out there who are professional scammers. They will give you false current addresses (ask to see their drivers license], they will have people pose as current landlords who are not. Generally, from the application you can ask enough questions that imposter references will trip up. Don’t be alarmed, these people aren’t the norm, but they are out there. Be Colombo when it comes to investigating your applicant. And don’t accept a deposit until your decision has been made. Nothing that in any way binds you until you’re ready to be bound. These steps don’t guarantee success. Sometimes a bad choice slips in and sometimes circumstances change. I had a tenant who was great for well over 10 years. Then his wife died. He met a new love. Moved in with her and unbeknown to me, moved his daughter, boyfriend and host of kids in. They sublet rooms. Caused all kinds of damage to the unit and nobody paid rent. So, there are no guarantees that problems will never crop up. But by doing your homework and taking careful steps, you can avoid a lot of potential heartaches and enjoy a wonderful relationship with your choice of quality tenants.