Viewing entries tagged
tenant rent

Why Do We Use 3-Year Lease Terms ?

Wonder Why We Use 3-Year Lease Terms On Our Standard Leases?

We are Here to Help!

Renting Student Focused Housing In Waterloo Is Different Than Anywhere Else

In Waterloo a majority of property management companies and independent Suite Owners will rely on a 3-year lease term when signing leases. This article will review the reasons why this lease type is used including the pro’s and con’s of using. a 3-year lease term.

Reason 1 - The Undergraduate Academic Schedule

While Sage Living does not rent exclusively to students, students remain our primary rental demographic. Approximately 95% of our managed suites are rented to students attending a local university.

The average academic schedule shared by Ontario universities include a 3-year long undergraduate program. In having a 3-year lease term your rental is then reflects the average academic schedule shared by a majority of student renters. This will make it easier for these renters to continue with the lease for the full 3-year term.

For more information on marketing your suite CLICK HERE

Reason 2 - Avoiding Month to Month Leases

A critical part of renting in Waterloo relies on optioning or being able to predict suite availability. By knowing which suite will become available before the Tenant provides minimum notice, our office can then market and work to re-rent the suite with as much notice as possible.

To better prepare for suite availability, and ensure our managed suites are always fully rented, our office must decrease or entirely eliminate the possibility of month to month leases.

Month to month leases can occur when a Tenant’s current lease continues past the fixed end date of the lease.
Example: If your Tenant rents from September 2021 to August 2022, this means they can continue to live in the suite past August 2022 on a month to month lease.

Tenants within a month to month lease have the ability to provide 60-days notice to terminate their lease agreement. While this may not seem concerning, this can cause major complications for Suite Owners.

A majority of Tenants looking for leases in Waterloo will rent for either September of May each year.

This means that if your current Tenant is on a month to month lease, and chooses to end their lease during a period of time where it is difficult or unlikely to re-rent the suite, the Owner could experience several months of vacancy until a new Tenant is located.
Example: If the Tenant cancels for February, it is unlikely a new lease will be secured for a start date other than May or September.

Reason 3 - Securing Steady Rent

Some Owners have struggled with short term leases and are unable to maintain the same rental rate each year. Problems like the recent pandemic resulted in some Owners losing Tenants and having to re-rent their suite for a cheaper rate.

In having a fixed rental rate for a set 3-year lease, the Owner can rely on a steady rent amount being collected each year for a minimum 3-year term. While some Owners have previously captured high rent for a single year or less, they may have recently faced complications where they had to offer large rental discounts.

Owners with 3-year leases and renewing Tenants typically earn more over a 3-year long average than those Owners who attempt to push for short term leases.

Have more questions?

We are Here to Help!

My Tenant Didn't Pay Rent, What's Next?

Missing Rent And Need to Know What To Do Next?

We are Here to Help!

In this FAQ Sage Living will review our procedures and recommendations when working with Tenants to collect outstanding rent.

Keep in mind Sage Living is able to collect over 80% of outstanding rent before the Suite Owner realizes their Tenant failed to pay rent on time!

Step 1 - Our Rent Collection Structure

Sage Living has purposely structured our rent collection process with a 1-month delay.
This means that the rent an Owner receives was collected 1-month prior.

Rent collected in September, is provided to Owners in October
Rent collected in October, is provided to Owners in November
Rent collected in November, is provided to Owners in December ….. and so on

In structuring our rent collection efforts with a 1-month delay, Sage Living is then afforded approximately 1-month to collect any outstanding rent amount on behalf of our Owners. This increases the Owner’s ability to continually receive rent each month uninterrupted.

But let’s explore what happens if we can’t collect rent on time

Step 2 - Our First Attempts

Our Collection Team takes action as soon as our office is aware of an outstanding rent amount. This will typically occur within the first few days of each month.

First
Our Collection Team will email the Tenant and their Guarantor, reminding them of the outstanding rent payment and asking to coordinate payment. We will include available payment options and resources the Tenant can use to pay the outstanding amount.

Second
If the rent is not recovered within the next 5-days of having sent the initial email, the Collection Team will then complete a series of phone calls to both the Tenant and the Tenant’s Guarantor outlining payment options.

Third
If the rent is not recovered within approximately 5-days of having called the Tenant, the Owner will then be notified of the outstanding rent.

Keep in mind that this is still approximately 2-weeks prior to when the Owner is expected to receive this outstanding rent as we offset the rent collection by 1-month.
Approximately 80% of collection cases are closed with full rent recovered before an Owners is notified. A majority of our Owners will receive rent without being aware of any rent collection complication.

Step 3 - Owner’s Collection Options & The Landlord And Tenant Board

If our collection attempts fail, and the outstanding rent not collected, the Sage Living Collection Team will contact the Owner and provide the Owner with two additional collection options made available through the Landlord and Tenant Board (LTB).

Option 1 - Eviction + Collection

This option is selected when the Owner would like to both attempt to evict the Tenant and collect the outstanding rent from the Tenant.

This option is not normally recommended by our office. If the Owner successfully evicts their Tenant, the Owner could then experience a period of time where their suite remains vacant. The Owner cannot rent the suite before the current Tenant is evicted and it is highly unlikely a new renter will be located to immediately occupy the vacant suite.

First
Sage Living will send a notice to the Tenant informing the Tenant of the Owner’s intention to evict the Tenant due to non payment of rent. The Tenant must be provided this notice and must be provided 2-weeks time to pay the outstanding rent amount and avoid eviction.

Second
If the rent is not collected within this 2-week period, the Owner can file with the LTB for an eviction hearing.

Third
During the LTB hearing the Owner may be rewarded with the ability to evict the Tenant and the Tenant required to pay the Owner the outstanding rent amount. Normally the Tenant is required to pay this amount within 11-days, but time may vary and is dependant on the hearing results.

Option 2 - Collection Without Eviction

This option is selected when the Owner would like to attempt the collection of outstanding rent without having to evict the Tenant.

First
The Owner will make an application to the LTB

Second
The Owner will then be provided with a scheduled hearing date from the LTB

Third
The Owner will participate within the hearing and may be rewarded with the ability to collect the outstanding rent from the Tenant. Normally the Tenant is required to pay this amount within 11-days, but time may vary and is dependant on the hearing results.

What To Expect When Filing Through The LTB

All Owners who would like to pursue rent collections through the Landlord and Tenant Board must be aware of two key items

One
There is a cost to file for a hearing with the LTB.
Filing fees are currently valued at $201, but the Owner if often rewarded the ability to be compensated for this amount by the Tenant during the hearing.
Owners should be prepared to front the cost of this filing fee.

Two
Sage Living can assist the Owner in preparing the appropriate LTB forms, but Sage Living cannot represent the Owner at the LTB hearing.

Sage Living can provide a recommendation to local legal professionals who are well trained and practice in Tenancy Law. Through our referral a Sage Living Owner will often be charged a a more affordable base rate of $125 for non complex hearings. Additional cost may be negotiated between the Owner and this legal representative should the hearing become more complex. Sage Living cannot assist in the negotiation of price with this third party legal representative on behalf of the Owner and the Owner is always able to use their own preferred legal representative.

CHANGES CAUSED BY COVID-19

All Owners must be aware of recent changes and policies now enforced by the Provincial Government due to COVID-19.

Change 1 - Substantial Delays With The Landlord And Tenant Board
Due to complications caused by COVID-19, and a higher than normal amount of LTB filings being made, hearing dates are significantly delayed.
It may take an Owner several months before they are notified of a hearing date for their filling.

Change 2 - Eviction Moratorium
An eviction moratorium is now in place. This means that no Owner can evict their Tenant at this time. The Owner can begin an eviction application, but they cannot enforce an eviction order until the moratorium is lifted. There is no estimate for when the moratorium will be lifted.

Have more questions?

We are Here to Help!