Almost every landlord has a story or two about dealing with a troublesome tenant, but what should you do with those who are ideal when their lease comes to an end? People with rental properties in Toronto and the GTA can avoid many landlord and tenant issues by simply encouraging good tenants to renew their leases. There are many ways and reasons, both financial and emotional, to take steps to encourage good tenants to stick around.
Often, when switching between tenants, rental income on a unit is lost for a month in between owners. This means a month of lost rent, along with any costs associated with preparing a unit for the next tenant. After calculating mortgage payments, lost rent and turnover costs for a unit, a landlord will have a good idea of how much they will lose by changing tenants.
The most obvious rewards to encourage a tenant to stay are monetary, such as rent reductions. Some landlords choose to reduce rent if a tenant will commit to a two-year lease. Those who cannot afford to decrease rent due to an increase in Toronto property taxes and other fees can offer a unit upgrade, enhanced security or even a thank you gift to strengthen the relationship.
When choosing an incentive for the old tenant to stay, consider all potential losses should they leave along with fees that may increase over the next year. Keeping the same tenant over time can also help avoid landlord and tenant issues which may end up in the legal arena. Those facing such issues should work with a lawyer to understand laws related to Toronto rentals.
Source: landlordology.com, "TIP: Offer incentives to current tenants so they stay", Kathy Adams 3, Accessed on April 7, 2018