Nightmares don’t always start out scary. Tracy and her husband recently took out a second mortgage to buy an investment property. The couple hoped that it would help provide for their new baby. After months of renovation, they met a polite and well-dressed young man eager to move in. The tenant told them he needed the apartment immediately because of a family emergency. The easygoing couple was reluctant to sign the lease without a proper background check but they thought “He seemed nice. What could go wrong?”

To their surprise, this seemingly nice tenant had filed for bankruptcy before rushing the couple into signing the lease. After the first month, he stopped paying rent altogether and never answered their calls. The couple couldn’t legally request rent payments while he was still in bankruptcy court. It took them seven months to finally evict the tenant and the apartment was completely trashed. Losing seven months of rent while paying two mortgages devastated the couple’s savings. Tracy painfully learned a new term that gives landlords chills  – professional tenant. 

What is a professional tenant?

Professional tenants are landlords’ worst nightmares. They understand legal loopholes and use them to withhold rent. Not only do they live in your property for free, they often trash the unit when they leave. With protective tenant laws in developed countries, evicting professional tenants is increasingly difficult. An eviction can drag on for months and costs landlords thousands of dollars in legal fees. Thus, avoiding professional tenants should be a priority when you try to rent out your investment properties. 

Professional tenants are hard to spot by appearance. They are great actors and pretend to be nice and agreeable until you sign the lease. Fortunately, there are ways to see through their smokes and mirrors. Using these four strategies can help you avoid professional tenants and protect your rental income. 

Tip No.1 – don’t fall for their sob stories

The most common tactic professional tenants use to fool kind-hearted landlords is to make up “personal tragedies”. They will try to win your sympathy by sharing bogus sob stories such as a bitter divorce or the sudden death of a family member. Their goal is to cloud your judgment and guilt you into signing the lease in a rush without proper checks. 

While helping your fellow man is a good trait, landlords shouldn’t change or skip a rigorous screening process due to the tenants’ personal circumstances. Being a landlord is not a charity. Your priority should be protecting yourself, your family, and your property.

Tip No.2 – verify landlord references carefully

To protect yourself from professional tenants, request as many landlord references as possible. Professional tenants have trouble providing authentic landlord references because they probably have had multiple evictions and dozens of angry landlords. Often, these tenants ask their friends to impersonate landlords during the application. 

Fake landlords are easy to spot when you speak to them on the phone. When you call the landlords, don’t tell them immediately you are checking someone’s references. You can first ask if their properties are for rent. A genuine landlord will naturally give you more information. A fake reference, however, will be confused by the question or stumble through a made-up answer on the spot.

Additionally, you can check the phone numbers and names provided in an online search to see if they match any past rental listings or property records.  If you are too busy to handle all these tasks you might consider hiring a local rental real estate agent so then the agent would take care of all these steps. 

Tip No.3 – run a thorough tenant background check

Verifying landlord references by yourself is helpful but it is not foolproof. Running a thorough tenant background check before signing the lease is an absolute must. Professional tenants fear background checks. That’s why they avoid it at all costs by telling you they need to move in immediately or even offering to pay extra rent upfront. 

However, never skip a proper tenant check. Professional background checks give you an in-depth view of the tenant’s credit score, residential history, and, most importantly, past eviction records. This is the best way to expose professional tenants as they generally have terrible credit scores and histories of evictions. A proper tenant check also helps you identify other unfit applicants by giving you all the information you need to protect yourself.

There are many providers for tenant background checks in the market. In the table below, we compared the background check services from a few providers. Out of the four, SingleKey has the fastest turnaround time of merely five minutes. With the 5-minute reporting time, professional tenants can never rush you into signing a lease without a comprehensive background check! 

Tip No.4 – get a rent guarantee 

The last tool will save you not only from professional tenants but other causes of non-payment and late payment. With a rent guarantee, you can get 100% protection for your rental income. 

Rent guarantees are a fairly new product. Landlords pay a monthly subscription fee for a guarantee on their rental income. When your tenants refuse to pay rent or fail to pay on time, the company, instead of you, will resolve the problem on your behalf. With a rent guarantee, you will still receive regular rent payments directly from the company even when the tenants fail to pay. Additionally, the rent guarantee service from SingleKey even covers ALL your legal expenses during an eviction and up to $10,000 for property damage. Having a rent guarantee offers the best protection on your rental investment and makes your passive income truly passive! 

Protection is Key! 

Professional tenants are landlord’s worst nightmares. Loss of rental income, trashed properties, and the legal troubles can really put a strain on you and your family. When it comes to investment properties, protection is key. Don’t be penny wise and pound foolish. With tools such as tenant background check and rent guarantee, you can avoid the headache and financial losses of dealing with professional tenants and protect your rental income in the long run.

Toronto has a lot to offer its residents, such as employment opportunities, good public transport, highly rated schools, colleges, and universities, top-of-the-line amenities, entertainment venues, exotic eateries, and multiculturalism. 

Because of these factors, Toronto is growing faster than any other city in Canada, and the resulting demand for housing has caused rental vacancy rates to drop to historically low levels. 

While it can be challenging for tenants to find a home in the city, it’s not impossible. Landlords receive many applications and have the luxury of looking for reliable renters. As a prospective tenant, you can set yourself apart from other applicants by following these tips:

#1 Get Professional Help 

You can improve your chances of finding a place to rent in the city by seeking professional help. It’s important to use the services of a Toronto rental agency that’s experienced, uses a proven formula, and won’t waste your time, instead of an inexperienced real estate agent who is too busy juggling multiple clients to understand your needs and is more interested in collecting their cut. Remember, it costs nothing to use such an agency’s services as a renter, so stack the odds in your favour. 

#2 Do Your Research

Before you start sending applications, do your research. Center on areas where you’d like to live and check the rental rates. Match this with your income. It’s recommended that you budget 30 percent of your earnings for rent. If the rent is more than 30% of your income, then your application may be rejected. 

Many properties include some or all utilities such as gas, water, electricity, internet, and more. Read the details of a listing carefully before making an offer. A home with higher rent that includes all utilities could be more cost-effective than a cheaper home where you’re responsible for paying more bills.

#3 Have Your Documents in Order

Due to the fast-paced nature of the city’s rental market, it’s vital to have your documents ready. This is especially true nearer to the city’s core, where renters are closer to businesses and can avoid the cost of vehicle ownership. 

It’s not unusual for high-demand rental properties to field multiple applicants at once. To avoid vacancy, usually, a landlord selects the first good candidate who submits all their paperwork. Have as many of the following documents ready when you start looking for a place to rent:

• • A credit report from Equifax
  • Character letters from professionals unrelated to you

• Reference letters from previous landlords that support your candidacy as a reliable renter

• A job letter from your employer that verifies your employment

• A photo ID 

If you lack a rental history or if your credit report is less than ideal, then don’t panic. You can improve your candidacy by offering a co-signer or a personal letter explaining your situation. Alternatively, consider renting with a roommate until you can rebuild your credit. And if you’re self-employed, then you may need to prove your income with bank statements or a Statement of Business Activities. 

These three tips can help you find a place to live in Toronto. By staying organized, vigilant, and using a little professional help, you can establish yourself as an excellent candidate.

As someone who’s been recently introduced into the world of real estate investing, it is important to note that there’s a learning curve you have to go through before you become a pro. One way to shorten your learning process is to learn from the mistakes of others.

Here are five common mistakes in real estate investing:

Buying an Old Rental Property  

If you’re buying an old home to serve as a living space for yourself, it’s okay to go with an old property, considering the fact that most of the price appreciation in real estate comes from the increase in land value. But if you’re buying an old rental property, then you’re setting yourself up for future headaches; unless you are a really good handyman with some spare time.  Save yourself the stress of numerous calls from tenants to deal with several problems an old rental property is very likely to have. 

Paying too Much Attention to a Building’s Structure while Ignoring its Location

What do you fall in love with when you see a building?  Most likely, you are swayed by breath-taking structural masterpieces. However, when it’s time to put down your money while investing in a property, you can’t afford to pay so much attention to the building’s structure at the expense of its location. 

Of all the factors to be considered about a property, the only thing that cannot be changed is its location, especially because this is a vital determinant of land price appreciation of your freehold property. Don’t be so swayed by structure because if your house is located in a good location, you can always renovate it to suit your taste and needs!  

Working with an Inexperienced Real Estate Agent

Working with an inexperienced realtor is rarely ever a good idea. If you’re a seller, you need to choose wisely based on factors important to you, such as local experience of agent, connections, commission, etc. Some of which you can assess via online platforms like Wowa.

As a real estate investor, always search for the best local real estate agent, who knows the locality you plan to invest in very well. Location is so important because investing in a good location is sure to bring up the value of your own house. If you have kids (or plan to), consider the kind of schools in that neighborhood and be sure they suit your kids’ needs before you buy a house there. 

It is best to have a list of things that are important to you as you set out in your search for a house. This way, you’d receive proper guidance from your agent, as they would have lots of experience in securing good real estate deals that fulfil your requirements.

Underestimating the Importance of Home Inspection

The investor who fails to acknowledge the importance of home inspection and as such, skips this very vital step, is one who is likely to have short-changed him/herself in their purchase. It’s always best to hire a professional home inspector to help carry out a thorough examination of the house you want to buy, and come up with a valid assessment. When you hire a professional inspector, you would not be saddled with a home that has lots of hidden issues!

Underestimating the Ongoing Costs

Some real estate investors make the mistake of underestimating ongoing costs for the house. You need to prepare to make monthly mortgage payments, and also allocate money to cover your property tax, and other such amounts. Also for rental properties one should assume that it has tenant 11 out of 12 months of the year and for one month each year the property could be without any tenant. Never underestimate the importance of ongoing costs of maintaining your property.  

Wrapping Up

Investing in real estate yields bountiful results, and if you’re well prepared to scale through mistakes that blindsided previous investors, even better for you!     

An investor who’s able to avoid mistakes such as purchasing an old rental property, not paying enough attention to the house’s location, working with an inexperienced agent, underestimating the ongoing costs and the importance of home inspection; will enjoy the benefits of this investment.  

Buying your first home is an exciting moment in your life. However, we need to be aware of a few things in order to be satisfied with our purchase.

Sometimes we make rushed decisions, and that leads us to experience buyer’s remorse. We may start noticing defects in the house that we didn’t see before, and then we start questioning our purchase. But it’s too late – you already bought it! 

People search for months to find their “perfect home”. But the truth is that no house is perfect. Purchasing a home is a significant investment, especially for those who work really hard to earn money. If you get a loan, you might get into debt, but it’s the best investment you could make.

No one knows what their future is. You might have an outstanding financial situation right now, but later you could go crashing down. That’s why we need to make investments during our flourishing times. That way, you make sure that you have somewhere safe to live. 

After buying the house, you shouldn’t keep looking for houses. You might encounter a similar home at a lower price point. But don’t worry, we’ve got some tips to make sure that you pick the best house at the best price.

Choose the Right Neighborhood

If you want to get the best value for money, you need to take a closer look at the neighborhood you’re interested in.

Some neighborhoods are more expensive than others. It all depends on the location and what’s around them.

For example, an apartment in Montreal is going to be expensive due to the fame of the city. But, if you still want to be around that area but at a lower price, you could search condos for sale in Griffintown. It is still located in Montreal, but a bit further from the central city.

Being a little further from a city has its benefits. You can enjoy fresher air and a quiet neighborhood, but you can always go to the city for those things you need to buy. 

Look at Recently Sold Properties

Before making the big purchase, you should look at similar houses to the one you’re interested in.

A comparable property is one that is similar in location, size, commodities, and condition. If you find one, you should compare both of them. 

Comparing two houses involves questioning whether they are at a similar price point or not. Is your house more expensive than bigger houses? Or is it cheaper than a similar one?

All of these questions can be answered with a quick online search. If you find that the house you want is more expensive than others similar, you should ask for a different price or search for another house all around. 

Research about Unsold Houses

Unsold houses can speak volumes about a property. Most houses don’t sell because they are overpriced, and this can be the situation for your future home that you might not even notice.

Sometimes, an overpriced home has its reason for being at that price. Maybe the previous owners did a lot of renovations and put expensive materials in the home. This is the only scenario that could justify a higher rate than other houses. 

The inside of a home tells us a lot about the owners. It doesn’t matter if the property is rather small; as long as the inside looks luxurious, it will elevate the price over other houses.

Market Conditions

An essential part of buying a home is researching the market. Similarly to the stock market, the real estate market also fluctuates a lot. 

Sometimes, there is a peak of prices, and other times, the prices decline. You need to research those fluctuations and see where you stand on. If the market is declining, you might feel that the houses are overpriced. On the other hand, if the market is at its peak, this is the best time to buy because some houses might maintain their original price. 

For Sale-by-Owners Properties

This is when the owner itself sells the house without a real estate agent. Usually, the prices of these homes are lower because when the real estate agent sells, they get 6% in commissions. 

Without the presence of a real estate company, the price should go down due to the non-existence of the commission for the agent. 

Sometimes, these owners who decide to sell themselves, might not set a reasonable price. Maybe the agent told them a price, and they weren’t happy, so they went with a price that they thought was fair. 

Final Thoughts

Buying a house is complicated, and it involves a lot of factors. Make sure that the price is fair for the house, and apply all these tips during your purchase.

Whether you are seeking to get your foot on the property ladder or you are hoping to purchase a new house, finding the perfect property for you can take time and effort. Make a list of all the things you would like to find in a property and order them according to priority. Presenting that list to an estate agent may help, but also be sure to keep an open mind. Sometimes, the things we are convinced we want are actually not the most important and we find other things we much prefer. Continue reading for our top tips to make the search for your dream home as pain free as possible. 

Take a trusted friend

Viewing properties on your own can be challenging, so take a trustworthy friend with you. If you are dazzled by the room sizes and struggling to see any pitfalls, your friend may well be the one who can ground you and show you the work that will need doing. Someone who will be honest with you is exactly what you need when you are about to make one of the most expensive purchases of your life.

View a range of properties

Looking at homes on the Internet can be a great way to narrow down the number of properties you would like to view. However, seeing photographs and floor plans does not convey the emotions you get when you walk into a house. Be sure to arrange viewings for a number of homes and focus on features as well as feelings. 

Revisit the properties and neighbourhoods

Even if you have fallen madly in love with a property and are certain it is the one for you, be sure to revisit on several occasions. This will allow you to see the home at different times of day and also the neighbourhood. In addition to checking out the area in person, you should also consult online city guides, for example, Markham real estate. Finding out as much as you can about to area to which you would like to move is vital.

Consider a house to do up

Sometimes, despite months even years of house hunting, it might be impossible to find a property that fulfils all of your criteria. If this is the case, why not consider buying a home that needs some work doing to it? Often, these properties will take into account the number of flaws and the price will be adjusted accordingly, leaving you more money to carry out renovation work on the property rather than spending it on the mortgage. 

Be proactive

Imagine finding the perfect street in the perfect city, yet no homes come up for sale in that area. That could be because of the idyllic location and wonderful neighbourhood. Instead of just sitting back and waiting, take the situation into your own hands and be proactive. Make flyers explaining that you are looking for a house in that area detailing exactly the type of property you desire. Post them into each house with your telephone number and you may well find your future home this way.