Category: Property Management

Report Reveals Renting From Small Landlords Is Cheaper

Big news from the Canada Mortgage and Housing Corporation! They released their Housing Market Insight report at the beginning of the month. Individual investors and private corporations own about 90 per cent of Canada’s purpose-built rental apartment units and most markets with a higher concentration of individual investors have lower average rents. In other words….Units owned by individual investors tend to have lower rents than units owned by other ownership types. This is most pronounced in smaller markets in Canada.

Individual Investors are defined as: all non-incorporated owners of rental housing stock, mainly comprised of individual investors and small joint ventures, representing 49.3% of the market.

Individual Investors are well-represented across all 35 metropolitan centres that were assessed as part of the report. The average rent associated with the units they own tends to be lower than the rent associated with other ownership types in most centres, including Montréal. However, the difference is generally smallest in centres with high overall rents, including Vancouver, Edmonton, Toronto and Halifax.

This isn’t really a surprise here. Smaller, private, non corporate landlords are better. It’s simple to see why.

They have a lot more to lose and generally rely on rental income as supplemental for retirement or for their daily lives. These kinds of landlords are exactly who we’ve created Renting Well for. Small landlords are like small businesses. Generally speaking, they have an interest in keeping tenants happy, ensuring that their units are in good shape, and have an inclination towards a more personalized approach. They have a tendency to be easier to contact and more often than not, they have a vested interest in avoiding turnover. Keeping tenants is cheaper than getting new ones. Even across the pond, english tenants were surveyed about satisfaction levels with their tenancies as part of the English Housing Survey 2015/2016. Tenants in the private rental sector were more satisfied with their accommodation than those in the social rented sector.

Choosing the right property management plays a crucial role in ensuring a positive rental experience. While smaller, private landlords often exhibit a more personal touch and a vested interest in tenant satisfaction, the role of professional property management, especially in a place like Burnaby, cannot be overlooked. Burnaby property management services, whether overseeing smaller residential units or larger properties, are equipped with the expertise and resources to handle diverse needs effectively.

Whether your landlord is an individual with a few rental units or a larger property management company, what matters most is their commitment to tenant well-being and property maintenance. Burnaby management professionals understand the local market dynamics and regulations, providing a valuable layer of knowledge and experience to both landlords and tenants. This ensures that issues are addressed promptly, and a harmonious landlord-tenant relationship is maintained. Whether dealing with a small-scale landlord or engaging with Burnaby property management services on a larger scale, the key is finding a partner who values tenant satisfaction and property upkeep, contributing to a positive and stress-free living environment, perhaps enhanced by enjoying thc gummies. A refreshing Indacloud Pineapple funta can be a delightful way to unwind after a day of managing or dealing with property-related matters, adding a touch of relaxation to your routine.

“Illegal” Rent Deposits Illustrate The Frustration of Landlords in Quebec

Apparently, it’s true, as per the CBC. About a third of landlords in Quebec have requested an illegal deposit, according to a recent survey by the landlord association CORPIQ. Landlords claims the reason they do this is because there is no way to guarantee that rent gets paid or that apartments are left in good condition upon move out. As a result, the organization is formally requesting a change in law with the provincial government.

This initiative is fuelled by a survey of CORPIQ’s members back roughly 2 years ago.

In 2015, the majority of rental property owners have faced the repercussions of more than three weeks of unpaid rent from at least one tenant, according to data obtained by CORPIQ through a survey recently conducted with its members.

According to this survey – 59% of landlords were in a similar position at least once in 2015. The figures show that the occurrence of non-payment of rent is on the rise; since a similar survey conducted five years ago revealed that 48% of landlords at the time have experienced the same problem at least once during the year. Keep in mind, this is in a province that is almost as notorious as Ontario in giving tenants who don’t pay their rent the ability to live rent free for quite a while.

Not everyone thinks this is a great idea, though. The Montreal Gazette’s Claire Abraham penned a piece last year that outlined her opposition to it. According to her piece, security deposits are allowed in most other Canadian provinces. Abuse is common: tenants who have paid their rent each month and left their apartment in good condition often see their deposits unjustly amputated or aren’t able to get them back at all. A new security deposit would put huge additional pressure on the Régie du logement, Quebec’s rental board, which is already unable to hear cases within a reasonable amount of time (many types of cases have an average waiting time of about two years). Yikes. That sounds like there’s a problem.

The average rent for a two-bedroom apartment in the Montreal metro area is $760. The Toronto average is $1,288. In Vancouver, it’s $1,368. There are only a small number of Canadian cities have cheaper rent than Montreal (the province’s biggest city and the second biggest municipality in Canada)– and then only much smaller, sleepier communities such as Saint John and Trois-Rivières.

New York City Landlords Get Creative To Commit Tenants

Landlords face steep competition as thousands of new units emerge onto the market.

The New York Times published a great piece a couple of days ago about the rental market in the big apple. At this time of the year, college grads start looking for apartments and generally speaking see rents rise with the season, however, this year is more of the same sluggish growth that market has seen since coming out of the financial crash. New York rents have skyrocketed in the last 10 years – but professional salaries haven’t exactly kept pace. With renters unwilling or unable to pay ever higher rents, the market has flatlined – and now it’s become a tenant’s market. As per the piece, last year, 8,774 market-rate units opened in Manhattan and Brooklyn, with an additional 15,291 opening this year. For the first time in years tenants renewing leases have the upper hand.

February saw rents for studios and one-, two-, and three-bedroom apartments in Manhattan fall year-over-year, according to real-estate appraiser Miller Samuel. As a result, landlords are getting quite creative in offering perks to tenants who agree to rent their units. Everything is on the table. Netflix subscriptions. Free Uber rides. Even flat screen televisions are on the block. The market is also seeing reduced security deposits and even a month of free rent. These creative enticements to differentiate apartments in an increasingly cluttered market of rentals are called “concessions”, and there are growing number of them. According to the StreetEasy there’s been a significant increase of tactics like this.

…citywide, the share of rental listings on StreetEasy with concessions rose to roughly 14 percent of listings in October…

Overall, StreetEasy’s data shows that the share of concessions has grown substantially over the past five years, rising from an annual total of 2.7 percent of listings in 2011 to 10.4 percent of listings in 2016. It looks as if they’re working too, at least to get tenants to renew their leases. The number of new leases was down 28% from a year ago.

The biggest deals seem to be happening at the top of the market, where some luxury developments are offering up to four months of free rent on a 24 month lease. But deals are to be had in older, less expensive buildings, too.

As of April 2017, average apartment rent within the city of of New York, NY is $3074. One bedroom apartments in New York rent for $2732 a month on average and two bedroom apartment rents average $3510. Manhattan’s median rental price fell 0.9% year-on-year to $3,350 in February. Median prices also fell in Brooklyn and Queens.

 

Landlords Have Legitimate Issues with Canada’s Half Baked Legislation

The Federal government didn’t bother to get into specifics on upcoming marijuana legislation.

The tabled cannabis law proposes allowing Canadians to grow 4 plants per person at home – whether they own or rent, provided the plants aren’t taller than 100 centimetres. It sounds benign when it’s framed as a new and progressive law – which in many ways it is – however the practical implications of the legislation are something that a growing number of national and provincial landlord groups aren’t happy with in the least. The government has not said if landlords will be able to prohibit tenants from growing pot in their apartments.

The Professional Property Managers Association and  The Canadian Federation of Apartment Associations are both looking to compel the government to change this aspect of the law. They both seek a ban on tenants growing plants in rented homes or multi-unit buildings. Full disclosure: we also support this change in the law as it is rooted in common sense. We touched on some of the complicated aspects of growing marijuana in a rented unit – particularly the insurance nightmare it has the capacity to create.

“I think the government is obviously balancing a lot of issues here. They do want to break the black market, and that’s important. But we think we can break the black market if they let people [only] grow it in their own owner-occupied homes, and the product is readily available in stores or by mail order.” -John Dickie, Canadian Federation of Apartment Associations

Optimal conditions for growing marijuana include warm temperatures, extensive lighting and high humidity. In order to grow weed, you need these three things. Creating the hydroponic conditions in a residence in an effort to achieve this key trifecta is not something you can do without affecting the domicile in some capacity. That’s just a fact. Water that is fed to plants will transpire and evaporate from the containers into the surrounding air. Cannabis plants also require warmth. Excess water vapour and high temperatures can create humidity damage. Large mold accumulations can follow and grow fast in humid environments and can lead to structural decay.

To boot, unusually high amounts of steam coming from vents in winter can damage exterior finishes on houses. The smell of weed seeps into drywall the same way tobacco smoke does, and even when it’s not being smoked, marijuana can create a permanent odour that can be repulsive to people – like other tenants and incoming ones in the future.

The electricity required for lighting in even a small cultivation of weed is high. It also introduces a fire concern with having that much botanical lighting in a house – and that’s assuming that a tenant doesn’t re-wire the electrical in a home (which they can’t do). Most wall outlets are on a 15-amp, 120 volt circuit. Many outlets are generally on that one circuit. One 1,000 watt metal halide or high pressure sodium light draws 9 amps at 120 volts. So just by using one of those plugged into a wall outlet, you have already significantly maxed your circuit – and that’s not taking into account the other devices, computers, or appliances that are also typically in a unit. Maxing a circuit is not a good thing. Your circuit breaker (if it’s working properly) may shut down your circuit because you’ve overloaded it. Your wiring may heat up, flame up, short out or otherwise fail. Lastly, there is an increased fire hazard danger due to people drying marijuana in a household stove.

Even four plants in a building can change the risk assessment on a property, and creates a greater likelihood of water damage, mould, fire, vandalism and burglary. Under most basic home insurance policies, marijuana-related damages or anything that companies believe is “high risk” is not covered. That view is shared by many insurance companies, according to the Insurance Bureau of Canada.

“Landlords currently have little recourse available if a tenant is growing medical marijuana and aren’t required to be told if it’s happening” -Avrom Charach, The Professional Property Managers Association

Under new federal rules introduced last August, landlords are left a little high and dry (no pun intended) if a tenant is growing licensed medical marijuana. They don’t even have the right to know it’s happening. None of that is right. The federal government should formally include a clause in the Cannabis Act including restrictions on any and all rented dwellings or they should at least mandate that provincial legislation needs to compensate for the loophole this creates.

 

 

An Argument Against Rent Control To Deal With Ontario’s 1991 Rent Exemption

Living in Downtown Toronto Condos Is Not A Right.

We made the news this week! The CBC’s Lisa Naccarato called me on Monday to offer a comment on Ontario’s 1991 Mike Harris rental “loophole” – apparently a controversial topic for many who live in Toronto. Toronto city councillor Mary Fragedakis moved a motion Tuesday that would see council come out in support of a private member’s bill at Queen’s Park that would extend rent control to apartments built after 1991. Her motion supports NDP MPP Peter Tabuns’s private member’s bill aimed at eliminating what he also refers to as the “loophole”. I don’t agree with eliminating this exemption and I’ll tell you why. Before we get into that…let’s start with a few facts.

FACT: Rent control in Ontario only applies to units that were first built or occupied before November 1, 1991. If the rental unit is in an apartment building constructed (or converted from a non-residential use) after November 1, 1991, then the rent control provisions of the Residential Tenancies Act, 2006 do not apply.

FACT: The post-1991 rent exemption was originally introduced by Bob Rae’s Ontario NDP government. It’s been maintained over time by Mike Harris’ PC provincial government (they made it permanent) as well as the governing Liberals. A low vacancy rate dropped even lower as developers were disincentivized by the regulated rental market for the freedom of condominiums. The exemption provided the incentive that private developers needed to build much of the existing condo stock as we know it and to recover from years of virtually no rental increases at all. Any changes to this incentive will undoubtedly have a negative effect on the market and real estate development (especially outside of Toronto where vacancy rates can vary) – not to mention the construction that is currently in the pipe. In the realm of construction, the foundation of any project lies in the quality of materials used. Opting for a provider that specializes in on-location blending of cement offers unmatched flexibility and efficiency. Such a method allows for adjustments to be made in real time, catering to the unique demands of each project. For an in-depth exploration of these benefits, consider reading an insightful guide on the advantages of on-the-spot concrete mixing solutions.

FACT: 85% of rentals in Ontario are covered by provincially mandated rent control.

FACT: It’s an exemption – not a loophole. These are two fundamentally different things. A loophole is defined as an ambiguity or inadequacy in the law. There are plenty of those in Ontario’s Residential Tenancy Act. This exemption was intentionally legislated. While it is undoubtedly true that many tenants have seen their rents increase significantly and at considerably more than the mandated provincial increase, there is no evidence to suggest there is widespread abuse of the exemption or that it qualifies as enough of an urgent issue that it needs legislative intervention.

FACT: Ontario’s Residential Tenancy Act heavily – almost hilariously – favours tenants. It always has. It favours tenants so much that Ontario Superior court justices have called for the provincial government to adjust the law and end what is a growing issue of tenants gaming the system. In 2014-15, the Ontario LTB received 79,740 applications. The ratio of landlord to tenant applications has remained relatively constant since 1998. 2014-15 was no exception, with 90% of applications filed by landlords. 70% of those landlord applications filed were related to non payment of rent. A stated purpose of the Residential Tenancies Act, 2006, is to balance the rights and obligations between landlords and tenants. It’s plainly clear that the law in fact does the opposite. The last thing landlords need is another short sighted unfair law that hobbles their ability to run their property portfolios as a business.

FACT: This issue is logical hogwash and is politically motivated. As per Martin Regg Cohn at the Toronto Star, “…rent hikes are a result of reduced supply and increased demand, which is what puts pressure on politicians for rent controls, which then depresses supply even further. Extending rent controls to newer (costlier) units would benefit the middle and upper class more than the working class (who tend to be stuck in older units anyway). Why target rentals while exempting the rest of the real estate market, notably the housing speculation that is driving much of the current crisis? It’s much cheaper and politically popular for governments to make landlords swallow foregone rent increases by imposing or extending price controls (vs. housing subsidy vouchers).”

“In the mid-1970s, NDP firebrand Stephen Lewis seized on media accounts of landlords gouging tenants. He goaded the government of then-premier Bill Davis into promising rent controls lest his Tories lose power. It seemed like a good idea at the time. But history is littered with good political intentions — and contortions — that create economic distortions.”
– Martin Regg Cohn, Toronto Star 

FACT: Condo landlords have it tougher than the average landlord. The owner of the condominium will have fixed, predictable costs in the form of mortgage payments and property taxes, but the maintenance fees (commonly called condo fees) can and often change – sometimes dramatically. Condo landlords are bound by two pieces of provincial legislation. The lease agreement is between the owner and the tenant and that relationship is still governed by the Residential Tenancy Act, 2006, in Ontario. However, within the building itself, the Condo Act has precedence and landlords are responsible to make sure that their tenants follow condo rules.

FACT: Landlords want tenants. If they raise prices above what the market is willing to pay then rent will adjust accordingly. The vacancy rate is low for a reason. It takes an average of only 17 days to rent a condo in Toronto. The city averagely sees 200,000 new people move to the 416 area code each year. This issue is supply and demand. Not greedy landlords.

Housing speculation is driving much of the current crisis. Toronto is clearly a city where people want to live. Hundreds of thousands have come here from around the world. Young people want to live where the action is as gentrification has firmly rooted itself.

I admire ethical landlords. I admire ethical tenants even more. Most landlords and most tenants are both. My solemn advice to any landlord who has a Toronto unit that falls under the exemption: Act in good faith. Be straightforward and upfront with your tenants. Tell them that your unit qualifies as exempt and explain the degree of exposure that exists. Be empathetic about having to potentially uproot your living arrangement and consider the discomfort, hassle, and inconvenience associated with losing your home after a year. Ultimately – a happy long term tenant is better than expensive turnover. Exercise common sense, and demand that politicians do the same.

 

Toledo’s Landlords Slow On Lead Safe Ordinance

In the summer of 2016, Toledo became the first city in Ohio to pass a law that prevents lead poisoning in the most at-risk children by requiring home inspections of rental properties. The “lead safe” ordinance calls for some rental properties built before 1978 to be inspected and deemed safe before leasing to tenants. Unfortunately, the city’s landlords have been slow off the mark. As it currently stands, landlords have until September 17, 2017 to gain the certification. Those who fail to comply are facing fines of $50 per day per dwelling unit with a maximum annual penalty of $10,000 per unit. Five months into Toledo’s passage of the law, only 22 properties have completed the steps necessary to be in compliance. As per the Toledo city paper; Chapter 1760 of the Toledo Municipal Code, also known as the Lead Safe Rental Ordinance:

The ordinance states that no property owner of a building built before 1978 with one to four rental units may permit people to live in the unit or provide child-care services in the structure without obtaining a lead-safe certificate for the property.

The average can of paint in the 1900s to around 1950 contained up to 50 percent lead carbonate. For 50 years, the U.S. used lead based paint extensively. 40 years ago, political leaders declared war on lead paint, citing evidence that even small amounts of lead can have awful effects on young brains, intellectual growth and cardiovascular, immune and hormone systems. The federal government began phasing out leaded gasoline in 1975, and banned lead-based household paints in 1978. In 2000, a federal strategy was deployed to end lead poisoning in children within a decade.

This all produced the desired effect. By 2006, blood lead levels in children under 6 had fallen to close to a tenth of their 1970s levels. But that positive momentum has since almost stopped. By the most recent estimate, about 37 million homes and apartments still have some lead paint on walls and woodwork, 23 million with potentially hazardous levels of lead in soil, paint chips or household dust. The Ohio Department of Health has identified 18 high risk ZIP codes in Lucas County. High risk ZIP codes contain at least one census tract where 12 percent or more of children tested in 2001 had blood lead levels of 10 micrograms and are further defined by demographic and socioeconomic data. One academic study predicted more than 3,400 children in Toledo have lead poisoning – an appalling statistic. The Ohio Department of Health estimates that approximately 19,000 children in Ohio have lead poisoning.

Any rental properties constructed prior to 1978 and in-home daycares constructed prior to 1978 will need to register with the Toledo-Lucas County Health Department and obtain a Lead-Safe Certificate. If a Local Lead Inspection takes place and the property passes upon the first inspection, the Lead-Safe Certificate is valid for six (6) years. If the property has undergone Lead Abatement in eliminating lead hazards consistent with the Ohio law, the LeadSafe Certificate is valid for twenty (20) years. According to the Toledo-Lucas County Health Department, inspections are likely to cost somewhere between $200-400, depending on the inspector. Considering the circumstances, this is an ordinance that makes sense. The consequences of not complying with it are considerable.

Guys, You Should Tell Your Landlord If You’re Going To Grow Pot.

A grow-op, whether legal or not, is still a high-risk activity

In August of 2016, Health Canada expanded rules for medical marijuana patients through the Access to Cannabis for Medical Purposes Regulations. They were granted the right to access their cannabis three ways.

First – They can register with Health Canada to grow a “limited” amount of cannabis for their own medical purposes. Second – Designate someone else to grow it. If a patient is not healthy enough to grow their own, someone else can provided they pass a background check showing they haven’t been convicted of a drug offence in the last 10 years and aren’t growing for more than two people, themselves included. Third – Getting it from one of 34 Health Canada-approved producers — the only legal source under the current laws.

Seems great, right? Not really. At least not from the perspective of landlord and retired fire inspetor Darryl Spencer. Go Public at CBC News told his story in full force last week, shining a light on what is increasingly becoming a complicated issue.

Spencer has owned a rental property in Kamloops, B.C. for over 10 years. After receiving complaints from one of his tenants about radiating heat from the floor and electrical breakers tripping, he discovered his basement tenant’s legal (albeit scattered and poorly set up) grow set up. The tenant received a medical marijuana license, enabling him to grow up to 60 plants without the permission or knowledge of his landlord. After learning of the development, he disclosed to his insurance company that he had a legal set up for the plants supported by a license from the federal government. His reward? Losing his coverage and having his policy cancelled.

Since last year’s new rules, landlords have little to no recourse if a tenant is growing licensed medical marijuana. They don’t even have the right to know it’s happening. You read that right. Under most basic home insurance policies, marijuana-related damages or anything that companies believe is “high risk” is not covered. That view is shared by many insurance companies, according to the Insurance Bureau of Canada, since a greater likelihood of water damage, mould, fire, vandalism and burglary exists.

While regulations may allow for the legal growing of marijuana for medical purposes, it does not change the structural risk grow-ops pose to homes and condos – Andrew McGrath, Insurance Bureau of Canada

So in other words – a tenant’s privacy trumps the rights of a property owner – at least as far as the federal government is concerned. Besides being ridiculously short sighted and ill considered, to boot, the government is leaving it up to the municipalities to enforce whether the grow set ups are safe. The problem with that is federal privacy rules prevent local authorities from knowing where marijuana is being grown. There also is no system in place to proactively check if tenants are growing the allowed number of plants and following their permit.

The federal government’s role is to ensure people who need medical marijuana have access – Jane Phillpott, Health Minister

Two months after his policy was cancelled, Spencer ended up finding a new insurance company that specializes in domestic cannabis-operations. The coverage cost almost twice what he used to pay and has a much higher deductible. The story has a happy ending though.

Go Public contacted Gore Mutual, Spencer’s original insurance company. They offered to reinstate Spencer’s policy for almost the same amount he used to pay, to which Spencer took up.

 

Absolute Idiocy On Unpaid Electrical Bills in Prince Edward Island

In another fantastic assumption that landlords are rich, entitled building owners, the wise city councillors in Summerside, Prince Edward Island are contemplating what to do about unpaid electrical bills in the small town of just under 15,000. The city takes in $20 million a year from the utility with the majority of people paying on time, however, after council “discovered” 1.3 million dollars of delinquency, all these city councillors determined the problem needed to be decisively addressed. Their proposed solution? Landlords should pay the bill. Seriously.

Summerside’s Director of Finance, Rob Philpott said involving landlords is just another option for council to consider that if for whatever reason the tenant is unable to pay in a timely matter or doesn’t pay at all, then landlords could potentially be held accountable for that. “There are 225 landlords in the city. It is safe to stay that if they became aware that they might be liable for the debt of a tenant who skipped out… it would generate a lot of attention,” added Philpott. If passed, this new law would affect residential, commercial, and industrial units.

If the municipality passed this law tomorrow, and also got all 225 of these landlords to foot this bill, they’d be looking over $5700 a piece.

City councillor Frank Costa thinks this is a step in the right direction. “Landlords have a collective responsibility to the city to ensure that we are not alone in having to absorb delinquent accounts,” added Costa. “If it is communicated well and there is an education process out there, I think people will recognize the value of this. I think we are giving them notice.”

Fellow councillor Tyler DesRoches disagreed.

“We are not signing up the landlord for the power; we’re signing up their tenant. The landlord has no idea whether or not their tenant is paying on time.”

Coun. Gordie Whitlock owns rental properties and agreed with DesRoches.“If you have a consistent collection policy with a consistent cut off time as to when the final notice is given after there is no attempt to pay, then there is no need for the landlord to be involved whatsoever,” said Whitlock.

Why the city doesn’t consider a more aggressive policy with respect to it’s unpaid bills is a head scratcher. Why the 1.3 million dollars in unpaid bills even occurred in the first place is interesting. The city of Summerside services 6950 customers. It’s reasonable to expect this utility to manage its accounts better. That’s their job! If they can’t wrap their heads around it, as a municipality supported for profit organization, how do they expect the small city’s 225 private landlords to be any better? Why should the city’s landlords accept this? How would the city’s landlords manage this any better? Are they to open their mail? How would landlords manage this as a new issue? Is not paying your electrical bill immediate grounds for an eviction? How many chances would someone get to settle up their electricity bill? This seems like a remarkably short sighted, objective ignoring, illogical, precedent setting idea. Utilities can and do ask for deposits in advance, engage collection agencies, cut off service and sue the tenants. To get the best Alberta electricity rates give us a call to learn how we can help. Landlords have to wait until the tenants move out and then initiate a small claims suit at their own expense. What this whole idea represents is a desire to see electrical utility delinquencies at zero, improving the cash position of the municipality, at the overall expense of the landlord.

Time to go back to the well, city councillors.

Perfect Storm For Landlords in Alberta

The slow down in the oil patch is affecting Alberta’s major city residential landlords. Seriously. The market was once quite hot. Now…not so much. CBC reported a doubling of the vacancy rate late last year.

Edmonton is a renter’s paradise right now. Economic slowness, coupled with more supply than demand in terms of available units, has flexed adversity on Alberta’s landlords. Vacancy rates have increased steadily since last year, and now range from six to eight per cent, depending on property type. The average rent in Edmonton and the surrounding area has dropped between 10 and 15 per cent from a five-year high in July 2014. This has been forcing landlords to get creative about attracting tenants and signing leases, including free Wi-Fi, amenities, groceries, and even flat screen televisions as part of rental agreements. We touched on this phenomenon in Halifax late in 2013, when landlords there were offering free iPads to prospective tenants.

In Calgary – a city where mayor Naheed Nenshi famously criticized what he considered rent gouging in 2014, things are not that much better. Rents have fallen astonishingly fast. A 20% drop in January of this year from the beginning of 2015. The Calgary Real Estate Board is anticipating that the vacancy rate will rise to 7% by the fall. By the fall of 2017, CMHC expects the vacancy rate in the city to decline back to 5.5 per cent. Calgary’s 2016 civic census revealed that while the city’s population increased slightly to more than 1.2 million in April, more people moved out of the city than arrived here. More than 20,800 units were empty in April, a 67 per cent spike over last year’s levels, which brought the vacancy rate for dwellings to 4.3 per cent, according to the census. According to the Financial Post, the vacancy rate hasn’t been this high since 2004, when the city reported the lowest level of migration in 12 years. A city hall analysis of historical housing data shows there are more vacant units in 2016 than in any of the past 16 years. To put this into perspective, Canada’s national vacancy average for urban centres is 3.3 per cent.

Even rural cities in Alberta have been affected.The Government of Alberta annually conducts the Rural Apartment Vacancy and Rental Cost Survey of multi-family dwellings in Alberta’s rural communities between the months of May and August. This survey does not include cities whose population is more 10,000 people. Vacancy rates have increased and decreased in a cyclical pattern with vacancy in rural Alberta communities being on an upward trend, having risen 3.7 per cent in 2014, up to 8.2 per cent in 2015. Not only are vacancy rates up in general, in a number of communities they are at their highest point since 2006.

Experts say the next big hit to the market could come in the spring, when many leases typically come up for renewal. Not good.

Questions? Comments? Are you a landlord in Alberta? We’d love to hear from you.

Tenant Assured Isn’t What Landlords Need

British data mining startup Score Assured has developed a system that claims to accurately determine a person’s financial and personal worthiness based on their social media reputation and history. The company has plans to market their system to employers and dating services but, for now, called it Tenant Assured, and is focusing on landlords as customers.

This is how Tenant Assured works:

A landlord who’s signed-up with Tenant Assured sends all of their rental applicants to a special link on the Tenant Assured website. They are then asked  to provide full access to up to four of their social media profiles—on Facebook, Instagram, LinkedIn and Twitter. These are then thoroughly crawled, scraped, and analyzed by Score Assured. The scrutiny includes conversation threads, private messages, and contact lists. A report is produced and delivered to the landlord. Landlords makes a decision on whether they want to rent to an individual based on the information provided.

Caitlin Dewey of the Washington Post wrote a piece on voluntarily going through the process herself. She found it uncomfortable. As per the piece:

…It’s not just the amount or detail of data that’s problematic, either. Tenant Assured reports include information such as whether you’ve mentioned a pregnancy and how old you are, which are both protected statuses under U.S. housing discrimination law. 

My personal tenant report includes a list of my closest friends and interests, a percentage breakdown of my personality traits, a list of every time I’ve tweeted the words “loan” and “pregnant,” and the algorithm’s confidence that I’ll pay my rent consistently.

Tenant Assured co-founder Steve Thornhill maintains that his product is a useful tool for landlords. “If you’re living a normal life, then, frankly, you have nothing to worry about.”

Here’s the thing though…we’re firmly of the opinion that being considered as a candidate for a tenancy based on your social media activity is not good business. This is unnecessarily invasive and most importantly feels weird (at least to us). While it’s true that the tenant is voluntarily providing this information, there is no way for them to view their ratings or dispute something they consider to be incorrect. Credit reports and background checks are regulated under federal law in the U.S. and in Canada and have consumer protections built into them. An algorithm that determines whether you’re worthy of an apartment based on your social media activity is not regulated at all. I mean…who doesn’t have a ridiculous tongue and cheek tweet or Facebook status meant in jest or sarcasm? Can algorithm’s detect sarcasm? We live in the age of autocorrect. It would be an understatement to say that this product will more than likely not produce a useful snapshot of a person’s payment reliability and character. We also question whether this is the right way to have a tenancy started off, even if a tenant voluntarily provides this information.

What do you think? Landlords? Do you have any comments? We’d love to hear them!