LEGAL EXPERTS WARN TENANT RATING WEBSITES COULD UNFAIRLY LABEL RENTERS
Landlords posting tenant reviews on so-called blacklist websites is a trend some in the industry worry could add to the housing crisis.
Websites like Tenantscore, Openroom and other similar blacklisting sites allow landlords and tenants to air their grievances, potentially preventing tenants from finding housing in the future.
A legal expert said that even if tenants have had negative relationships with landlords in the past, it shouldn’t hinder their ability to find a place to call home.
“The danger with these sites is your information will be out there and anyone can see it. It can put you in a very vulnerable position,” said Cynthia Iheanacho, a lawyer and renter advocate at Waterloo Region Community Legal Services (WRCLS).
“I tell all my clients not to add any information in these and just be careful if you see your name on a site,” said Iheanacho. “If there are any issues, it should be handled through the tenant board. You never know how this could be used against you.”
Some landlords renting in Cambridge are afraid they will rent to the wrong person and lose money if the tenant runs into financial difficulty and decides not to pay.
“Credit score is the most important thing because we need to pay our mortgage and we can’t have people who have a bad history of making payments,” said property owner and realtor Kamal Khanna.
“Before, if you needed to get rent payments from a tenant, the Landlord Tenant Board (LTB) would take forever to schedule a meeting,” he said.
As a realtor, Khanna works with other property owners and tells them all the same thing; they need to make sure that whoever they are bringing in is able to cover their rent.
Tenant rating websites are being touted as a useful tool to assist landlords in finding the right candidates to rent their units, but he agrees if someone withheld rent in the past it could hurt them in the future.
Sites like Openroom compile court documents from the LTB on tenants and detail the findings of the hearing and who was at fault.
These cases could range from eviction from non-payment of rent to simple disputes.
Iheanacho said under no circumstances is withholding rent a good idea.
“Even if a landlord has not done proper maintenance this is no excuse to withhold rent payments,” she said. “You can make payments directly to the tenant board.”
“I want to make this very clear. It is illegal not to pay your rent. It is a tenant’s obligation to fulfill their contract and pay their share,” Iheanacho added. “The landlords need to pay their mortgage and they have a right to collect what is owed to them.”
But as rental prices and the cost of living continue to climb, tenants are finding it harder to keep up with paying their rent and can find themselves in a bad situation, Iheanacho added.
She’s recently encountered clients who have had to choose between paying rent or buying food for their families.
Whatever the case may be, there is usually some sort of negotiation that can be worked out, she said.
“We work with clients to negotiate with landlords and maybe pay half of the rent or make a payment plan, but at the end of the day this is a business for a lot of people and they do still need to be paid.”
If a renter is in a position where they are unable to afford their rent, Iheanacho thinks they should downsize and try to cut their costs of living.
In Ontario, there are certain rent controls in place that will only allow a landlord to raise rent by a certain percentage each year, regardless of what their mortgage payment looks like.
As a landlord, Khanna fears that if a tenant decides to withhold rent, they will be faced with a year-long process to get in front of the LTB for a hearing to get what they’re owed or to evict a bad tenant.
The LTB has recently started to expedite rent-based claims in the court to lessen the impact felt by property owners.
“If you can prove that you are close to defaulting on your mortgage or that you are in financial trouble due to a tenant not paying you, the LTB can schedule an appointment in as little as three weeks,” said Iheanacho.
Some landlords in Cambridge are reporting losing hundreds of dollars a month, Khanna said, because they are on a variable mortgages and are sometimes paying out of pocket to cover the interest.
He calls current interest rates coupled with the high cost of housing “insane” and says he feels bad for anyone who got into real estate market during its recent peak.
Khanna adds that even if a landlord raises the rent for a three bedroom unit to over $2,800 a month, their mortgage could still be well above that.
This may hurt in the short-term, he said, but that landlord will still see their overall asset grow in value over time.
This gap in profit is a key reason why landlords are using sites like Openroom to make sure that they are getting tenants that have a good history and can afford their payments.
“It’s not east right now for renters, but landlords are also going through it as well,” said Iheanacho. “We need to make sure that we don’t forget that these are all people we are dealing with and not get lost in the numbers.”
Story by: BayToday.ca
