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I thought I would post this article. Being a landlord either seems to be great or a nightmare.

http://cnews.canoe.ca/CNEWS/Canada/2010/01/07/12375051-sun.html

There seems to be many articles, postings, comments about the cash flow/investment side of rental property, but this covers the human side of being a landlord.

And yes...it isn't always like this. I have had some great tenants over the years.
 

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I understand her frustration, but at the same time - this is one of the risks of being a landlord. It's hard to get people out if they don't pay and don't want to leave.

I wonder if she thought real estate investment was "passive income"?
 

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I thought I would post this article. Being a landlord either seems to be great or a nightmare.

http://cnews.canoe.ca/CNEWS/Canada/2010/01/07/12375051-sun.html

There seems to be many articles, postings, comments about the cash flow/investment side of rental property, but this covers the human side of being a landlord.

And yes...it isn't always like this. I have had some great tenants over the years.
I just bought my first duplex and seem to have great tenants. But, any advice on how to pick tenants?
 

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Sadly, another example of broken bureaucracy when a simple common-sense would have solved the problem.

In any case, makes you wonder how the tenant got the Bentley to begin with? I am thinking she went to a dealership and just sit in the car for months going on hunger-strike and doing all the regular humanly things there until finally the dealership gave up and let her drive away the car for free.
 

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I am in the business of avoiding situations exactly like these and I can tell you that people like this exist and are preying on landlords. Like thieves they look for easy pickings. Certain things make you very vulnerable to people like these.

1. Desperation - Don't be desperate to rent. I know it's difficult to pay your rental property mortgage and your own.

2. Look for honestly - If someone starts out by telling me a funky story or something that doesn't add up watch out.

3. A crappy property that is not well maintained - It does not matter what rent you charge a crappy dirty place will attract crappy dirty people. I really cannot emphasize this enough. You would be thoroughly disgusted at what people expect other people to live in. But they have to pay the rent or else.

4. Be realistic - No Drs or laywers want to rent your small three bedroom house with an old kitchen in Scarborough. They don't want to or have to. You will turn down good honest tenants until you become desperate and victim of a liar.

5. Price yourself at the market not above or below - Seriously people expect to pay a certain price for a house in the Beaches and if you are priced below that no one decent will want to waste their time (believing its a scam). If you price yourself above you attract people who don't care about price mostly people who cannot manage their money.

There are two kinds of tenants who don't smoke, don't drink, have great jobs, have no pets, no kids, quiet, well presented, polite, and perfect.

The first kind are about 1 in 50 people

The second kind are liars.

My # 1 criteria for rental is the ability to pay the rent. Full Stop

The Landlord & Tenant Board is very frustrating for many landlords but some people have unrealistic expectations about what the Board should do for you.

When you rent your property you are turning over "legal possession" of your property.

I liken it to leasing a car which is a very similar from legal standpoint. Can you tell people what to put in their car? if they can smoke? play music? if they can have a dog in their car? No well it's the same if you are a landlord. From the moment you give them the key it is their space.

And you know what? The tenant is your customer.... so treat them nicely and professionally. In no other business I know of can someone get thousands of $ per year in rent and still ***** about paying $100 to replace a leaky tap.

Oh and please don't hire a realtor to rent your house out. Get a rental agency to rent out your house. Rental agencies will also evict the person they rent to FOR FREE as a TERM OF THEIR CONTRACT. Then they will also RERENT IT FOR FREE. Also they won't bug you to sell your house the whole time.
 

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The real estate section of the CBO forum is full of such horror stories, frustrations and injustices against landlords.
It's just not worth being a small time retail landlord with your own money and personal financial well-being at stake (at least in these parts of Ontario).
Unless you have a bunch of lawyers, goons and other kinds of "professionals" at your disposal, it's a suckers game.
Buy units of a REIT and go back to bed....
 

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I liken it to leasing a car which is a very similar from legal standpoint. Can you tell people what to put in their car? if they can smoke? play music? if they can have a dog in their car? No well it's the same if you are a landlord. From the moment you give them the key it is their space.
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I had never thought of it this way, it's a good analogy.
 

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The real estate section of the CBO forum is full of such horror stories, frustrations and injustices against landlords.
It's just not worth being a small time retail landlord with your own money and personal financial well-being at stake (at least in these parts of Ontario).
Unless you have a bunch of lawyers, goons and other kinds of "professionals" at your disposal, it's a suckers game.
Buy units of a REIT and go back to bed....
I would agree after all the input; except that given REIT values, or the ones I know of at least, they are expensive, and if you worry about a market correction, you could loose a good amount of your principle if you end up needing to sell. But if you have no plans on selling, who cares how much of principle is lost as long as the yield does not also drop, especially if it is an ETF, likely it will go back up again at some point in time. If anything a price drop would be a buying opportunity.

From what I could find around Ottawa, prices are crazy compared to the rent to could get for the purchase price, unless you have a million or more to buy a larger unit complex. And there is a lot of talk about a housing price bubble coming in Canada too, so you could loose principle investment in buying real real-estate too. But again, if you are not planing on selling anytime soon, who cares.

If I had a good local ethical management company dealing with a rental property for me though, and cold actually make $ of the rental relative to price, I might go for the real real-estate.

So in the end I guess I go bend towards buying REITs now and 'going to bed', maybe with the help of a sleeping pill or two. :)

It's a tough one.
 

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I know people who are great tenants and for some reason and not a good one, they never bought their own place. They treat the house like they own it and the landlords are smart and do not raise their rents and sit back and collect the rent.

I would think there is a value to be added for good tenants that goes well beyond simply getting the most rent you can get, once you get one. Having people damage your house or the hassle of eviction I would think would cost a lot more then any extra rent you might get if good tenants leave.
 

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The real estate section of the CBO forum is full of such horror stories, frustrations and injustices against landlords.
It's just not worth being a small time retail landlord with your own money and personal financial well-being at stake (at least in these parts of Ontario).
Unless you have a bunch of lawyers, goons and other kinds of "professionals" at your disposal, it's a suckers game.
Buy units of a REIT and go back to bed....
Even with the information I have given out I would still buy a property and rent it out.

Buying an income property will almost certainly outperform a REIT.

After working in buildings that allowed anyone with first and last in the door I can assure you about 95% of tenants will pay their rent.
 

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Even with the information I have given out I would still buy a property and rent it out.
But you are a professional property manager with (possibly) years of experience in this field.
I am referring to a single individual property owner, esp. a retired one like the one in that news article.
The deck is stacked against her (and anyone like her(.
Buying an income property will almost certainly outperform a REIT.
Yes, agreed, from a purely returns % perspective.
But that doesn't include all the hassle, sleepless night, botheration, etc.
How do you attribute or impute the cost of that?
Imagine what this poor landlord is going through.
I have been reading too many of such stories of hapless landlords on the CBO forums.
Maybe I am skeptical.
 

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But you are a professional property manager with (possibly) years of experience in this field.
I am referring to a single individual property owner, esp. a retired one like the one in that news article.
The deck is stacked against her (and anyone like her(.

Yes, agreed, from a purely returns % perspective.
But that doesn't include all the hassle, sleepless night, botheration, etc.
How do you attribute or impute the cost of that?
Imagine what this poor landlord is going through.
I have been reading too many of such stories of hapless landlords on the CBO forums.
Maybe I am skeptical.
I disagree the deck is not stacked against her. I have met a landlord that picked her tenants using astrology for crying out loud. Small landlords as a whole can use a whole lot of getting familiar with their OWN business.

You know when you hear these stories there is another side. I see many landlords try to rent stuff that shouldn't be rented, is illegal to rent and who are generally cruising for a bruising.

That is really the reason I started my business. To bring the skills I learned working in rentals, collections and evictions in large buildings to small landlords. What I have found is that I am usually not very successful at getting these landlords to understand what their business is. They don't want to believe me. They want the money the tenants give but don't want to provide a good service.

Currently for rent I have the following houses

Beautiful house - great location - smells of cat really bad I told the landlord to paint the room to get rid of the smell, still not done almost 2 months later, last time I met him there i told him he had to clean the cat feces out.

Nice little house - decent location - original oil fired boiler smells of oil I explained to the owner she needs to change it, she can't afford it even thought I have had the house continuously rented for 5 years or so now.

Beautiful basement apartment - great location - no pets - no smoke - perfect credit over improved and over priced

Three Bedroom apartment - weird and small living room, no pets, no smoke, no kids, no laundry, no parking, perfect credit. I told this lady she needs laundry, people who have no car and who are renting a three bedroom want laundry on site.

I am not a tenant advocate. I work for landlords. I only make money when I rent and if I pick bad tenants I have to kick them out again. Sometimes I refuse to rent places. A lot of landlords call me because they are scared to rent after a bad experience. I invariably see the same things. Poorly maintained dirty properties. Almost every time I go to list a house I have to ask the landlord to clean the house. These are basic things. I tell them a dirty house brings dirty people. Nothing I have learned in over 10 years of renting property has taught me how to convince a clean decent person to move in and spend even one minute cleaning other people's old filth.

So I can't speak to this lady but I can tell you this a review is something very specific at the Landlord and Tenant Board. You review an order for an error of law and rarely does it stop the process of eviction. See even if the tenant applied to review her case she would be evicted before her review was granted. What it sounds like is happening is that her case is being delayed because of maintenance issues. When you have a maintenance issue attached to your arrears case it will be rescheduled many times because such cases are last for the day and usually there is time for only one such case per open courtroom per session. I just did a case like this it took from June and we still have not received the order for eviction. The tenant has left now. This particular house was very mouldy from day 1.

Lawyers as a matter of fact know very little about landlord and tenant law. Paralegals do Landlord & Tenant Board matters, property managers and the landlords themselves. Lawyers not very much. Cases from the board can actually be appealed to the Ontario Supreme Court. Then you need a Lawyer. If you have a tenant who is on Disability or Ontario Works they can get free legal aid and appeal their case but this is very rare.

I once had a case take 9 months. That case the old property manager who was fired but was still working for 2 weeks rented a house to a lady who had a drug problem and was a prostitute on Ontario Works. That case went to Osgoode Hall. I'll never forget our last court date was several days after September 11th she got this biker to come and say she was ministering to the victims of Sept 11th. It got kicked out of court but it took a long time.

The worst tenants are the ones looking for problems so they can back out of paying. Like the ones who rented the mould house. They knew exactly what they were doing. I suppose if I wanted to with what I know about the law I could probably live rent free for a year.
 

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I thought I would post this article. Being a landlord either seems to be great or a nightmare.

http://cnews.canoe.ca/CNEWS/Canada/2010/01/07/12375051-sun.html

There seems to be many articles, postings, comments about the cash flow/investment side of rental property, but this covers the human side of being a landlord.

And yes...it isn't always like this. I have had some great tenants over the years.
I saw this yesterday and was shocked. I never wanted to get into the landlord business because of stories like this. My friend rents out his condo and he seems to get the pattern of good tenant, followed by bad tenant, followed by good tenant, etc. And he really does a thorough job of screening. His last bad tenant wasn't even the problem. It was his girlfriend, who didn't even live there, who called and complained about the smallest thing.
 

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Discussion Starter #16
Berubeland - you should write a book of hints and stories about tenants and landlords, you seem you have alot of very interesting experiences with this.

Although as a generalization, a crappy place would definitely only bring crappy tenants, at least with a place in great condition you would have a chance of having great tenants.
 

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The most correct statement (of many good ones) is that being a landlord is a second job, and it is not always part time or ever convenient.
I have owned a triplex for 14 years and have seen everything. Most people see rent cheques being deposited - simple. They are so naive. Trust me, there are MANY advantages to investing in REITS and would encourage others to do so. This is the advice I recommend all the time to those who want to repeat my 'luck'. When I meet someone who I believe has realistic expectations and are skilled enough to do well in RE investment, I discuss at a higher level and provide sound advice.

Personally I have had very positive experiences with tenants (two tenants came to my wedding and we remain friends) but a few have been horrible and made me question if it was not worth selling. When I discuss these with other LLs their horror stories seem much worse and would steer me clear of rentals.

Here is some sound advice.

Only buy a property that you would want your daughter to rent.
Do research on what the value of your unit(s) is on the market. Too high and people figure this out and leave, too low and you are wasting your time.
Don't lose focus of cash flow and keeping costs low.
Be proactive and visit your property often, contact your tenants regularly and respond immediately to their needs.
Try to do everything by email as these are invaluable when you have to go through a process with a provincial tenancies authority.
Budget for capital costs (new roof, etc)

Good luck.
 

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Trust me, there are MANY advantages to investing in REITS and would encourage others to do so. This is the advice I recommend all the time to those who want to repeat my 'luck'. When I meet someone who I believe has realistic expectations and are skilled enough to do well in RE investment, I discuss at a higher level and provide sound advice.
Do you suggest buying REITs right now if you have cash and want to get into them? If so do you suggest going with a REIT ETF like XRE or some specific REIT stocks, and if the stocks, do you have any suggestions on which ones someone should consider looking at given today's prices?

I won't hold you to any of your recommendations should they fail. ;)

Thanks for your input.
 
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