No double dipping allowed
What happens when you have a fixed term lease and your tenant chooses to end the tenancy before the lease expires.
All rental agreements are required to have specific terms included. One of those terms is not the compensation required if a tenant vacates before the end of a fixed term.
A lease should have a term describing the compensation a tenant is required to pay when they end the tenancy early. If the tenancy agreement has no specific term, a tenant may still be held responsible for reasonable costs lost from the tenants terminating early.
When a tenant vacates early, a Landlord has the responsibility to mitigate their loss. What does that mean?. If your tenant leaves at the six month point of a one year lease, a tenant could be responsible for the remaining six months of rent, if the Landlord attempts to mitigate their loss. The landlord has the responsibility to advertise the property for rent, as soon as the current tenant provides notice. If the landlord waits until a month after the tenant vacates, then begins looking for a tenant it may be perceived as not trying to mitigate your loss.
When your tenant vacates and you spend time looking for a new tenant and are able to find one, the current tenant’s responsibility for the remaining months of the lease ceases. Landlords are not allowed to collect rent from a new tenant and charge a previous tenant for unpaid rent for the same calendar month.
When your tenant provides notice, make the effort to find a new tenant immediately, show your efforts of advertising and the applicants and or lack of applicants for the vacant property. These tasks will assist in mitigating your loss and provide information for a case of having the tenant pay for the remaining term of the lease.
How does Cartref Properties help mitigate these issues?. Our lease agreements have a clear explanation of when a tenant vacates the term early the cost to the landlord for ending the lease. We also clearly explain the required notice period a tenant must provide to the landlord when vacating a property.
Need assistance with your rental property contact us for an evaluation of your needs.
Cartref Properties specializes in managing rental units located within Strata Corporations.
www.cartrefproperties.com
“Helping landlords find tenants a place they call home”
Renting to friends or co-workers is that good or bad?
Renting your investment property is an emotional and stressful process. Performing proper due diligence helps select quality tenants, and that still may result in a negative rental experience.
There are many places to search for tenants, recently I heard a suggestion that your network of friends, family, co-workers and neighbours are good places to find tenants. You may find a quality tenant in one of these groups. The important part of searching for a tenant is “due diligence”. When we take the recommendation of friends, co workers or family we may reduce the amount of due diligence we perform, allowing a person to rent who may not be the right fit for your property.
When a co-worker recommends a person to rent, do they really know their financial history? Maybe they buy coffee at the office, but are buried in debt and won’t be able to or are currently not paying their rent. How many people truly know how much their co-worker is earning, many wages and salaries are kept private.
When a friend recommends a person do you gloss over the possible red flags because they were recommended by your friend. If something comes up that appears inaccurate or untruthful are you prepared to reject the friend’s recommendation and how will that affect your friendship.
The goal of finding a tenant is, find a person who matches the rental property needs with your expectations, which will then result in a positive rental experience for both the landlord and tenant.
You may find quality tenants from friends, co-workers and other close relationships. What is important is you continue to perform your due diligence when checking their information, and be prepared to take the necessary actions if the tenancy becomes a negative situation, including eviction.
Evicting a person for non payment of rent or damage to your rental property can be a very stressful and emotional experience. Having to perform these actions against a friend, or co-workers recommendation would be more emotional than normal.
People prefer to avoid conflict, so eliminate the conflict by performing your due diligence or find other sources to rent your property. Using a property Manager can also reduce the emotions and stress of renting your property.
Need assistance with your rental property contact us for an evaluation of your needs.
Cartref Properties specializes in managing rental units located within Strata Corporations.
www.cartrefproperties.com
Is the Residential Tenancy Branch favorable towards tenants?
Is the Residential Tenancy Branch favorable towards tenants?\
This is a phrase I hear all the time from Landlords, people who have rented before or who are not familiar with the rental laws in BC. The simple answer is yes, the Residential Tenancy Branch leans towards protecting the rights of tenants, as the government doesn’t want to make a person homeless unless the process has been followed correctly.
Recently a friend mentioned their friends’ experience in renting out their basement suite. They spent good money fixing it up, rented it to two “professionals” only to have them “trash” the place and fail to pay rent. They had a difficult time evicting the people and had significant costs to repair the unit.
The above issues have nothing to do with the direction of the Residential Tenancy Branch. My dad always told me “the game of golf is simple, It’s just not easy”. Renting a property is simple, being a landlord is not easy, yet many people think they understand the issues and can manage them on their own without a professional. I have rented many properties to “professionals” and I have turned down many professionals who applied to rent units. The tenant selection process requires a lot of reading between the lines to find out as much information before you allow a person to occupy your investment property. Don’t judge a book by it’s cover, taking your time to thoroughly investigate and review the applicant’s information provided is a necessary step to a positive experience in renting your property.
Doing your due diligence and reading between the lines will often raise red flags, as I call them, that you should consider another applicant. It’s a process that should never be rushed, and good applicants will provide the right information you need to make the right choices.
How do you read between the lines?. Recently I had a landlord show me some documents from her applicant which turned out to be a negative experience. The application form said he earned $5,000 per month. The tax document provided, which turned out not to be his, said he made $150K the previous year. Simple math shows this information to be inaccurate and the landlord should never have rented to this person.
A recent applicant to a property we manage advised they worked for a Canadian Airline and when asked if they were still flying and indicated they were. A few pointed questions led me to believe the information was inaccurate and eventually the person admitted they were laid off due to the pandemic. It’s not prudent to rent to a person who provides inaccurate information in the application process.
Many of the laws on renting have been created or amended due to Landlords over reaching the boundaries of the laws causing governments to make changes to protect the renting public. It is my experience when a landlord follows the laws they can have a positive experience renting their property.
Need assistance with your rental property contact us for an evaluation of your needs.
Cartref Properties specializes in managing rental units located within Strata Corporations.
www.cartrefproperties.com
Why do I need insurance?
When you own a rental property you should have insurance coverage for your property. If your property is within a Strata Corporation there are multiple insurance policies which could be utilized in protecting the property.
When you rent out your condo or townhouse in British Columbia there should be three insurance policies engaged on the property. The three policies are, the Strata Corporation’s insurance policy, the homeowners policy and the tenants policy. What’s the difference for these types of insurance?.
The tenant policy is often referred to as contents insurance as it mostly covers the contents tenants have within the rental unit. Tenants insurance can include many other features including the option of relocating a tenant and their belongings while repairs are being completed after an event at the property.
The home owners insurance policy covers the requirements for repairing the strata lot. The Strata Corporations insurance policy covers requirements to repair common property.
Many strata lot owners misunderstand the need for insurance for their property, believing the strata has insurance.
The Strata Corporation is responsible for repairing common property and insuring the original fixtures within the strata lot. Insuring and repairing are two different situations which clouds the issue of when a Strata Corporations policy is engaged to repair a strata lot. Inside the unit is not common property, it belongs to the owner of the unit which makes the homeowner responsible for repairing and maintaining their strata lot.
The simple explanation for this is any repairs below the Strata Corporation deductible amount are the owner’s responsibility to repair. How this works is, if your strata has a deductible for water damage of $25,000 and there is water damage to your unit in the amount of $20,000, the homeowner must pay for those repairs. The Strata insurance policy will only be engaged when the damage exceeds the $25,000, as that is the insurable limit.
A homeowner could then engage their insurance policy, pay a deductible to have the $20,000 in damages repaired. The homeowner can also choose to repair the damage without engaging their insurance policy.
We can’t emphasize enough the importance of having proper insurance to protect your investment. Each Strata Corporation will have a declaration page outlining the deductibles for their policy, providing this to your insurer will assist you in acquiring the correct coverage needed. Having insurance and never needing to use it, is the best case scenario. Not having insurance and needing it is an adventure you want to avoid. We aren’t insurance providers and recommend you seek professional advice when it comes to obtaining insurance for your investment
Cartref Properties specializes in managing rental units located within Strata Corporations.
Need assistance with your rental property contact us for an evaluation of your needs.
www.cartrefproperties.com
Duty To Repair
Being a Landlord has many different aspects of responsibility. Landlords provide a place for tenants to live and call home. Often landlords overlook some basic needs and requirements of the property which over the long term can have a greater financial cost to the owner.
Repair and maintenance is one of those needs overlooked. It is important landlords repair and maintain their property to meet health and safety standards required by law. The property doesn’t have to have the most recent appliances or flooring, it needs to have items that are in good working condition.
When a landlord fails to repair and maintain the basic needs of the property, tenants have options to seek compensation from the Residential Tenancy Branch. A recent Residential Tenancy case found a tenant choosing to vacate the property before the end of the fixed term due multiple repairs not completed upon request, including water damage and an inoperable heating system. The RTB determined these issues were material terms of the tenancy agreement providing the tenants the right to end the tenancy early without being held responsible for the remainder of the term. Normally, tenants who terminate a fixed term agreement could be held responsible for the remaining months rent of a fixed term agreement. The rental unit was then vacant for four months until new tenants could be located. The cost of searching and placing a tenant, plus lost rental revenue for four months may have been more costly than completing the repairs to the unit, which still needs to be completed before new tenants occupy the property.
It is important for landlords to complete repairs in a timely manner ensuring costs don’t increase and tenants won’t have opportunities for compensation through the RTB.
One way for landlords to assist in keeping repair costs manageable is, inspect the property regularly. Cartref Properties inspects all properties twice a year and can provide more when owners request additional inspections.
Cartref Properties specializes in managing rental units located within Strata Corporations.
Need assistance with your rental property contact us for an evaluation of your needs.
www.cartrefproperties.com