Thursday, September 15, 2011

Do not become a landlord in Quebec

My boyfriend and I purchased a property with his parents a few years ago as an investment. We rented it out, and for the first year everything went great. We had great tenants who paid their rent on time each month and caused no damage. However, we were not so lucky with our next tenants and eventually had to evict them.

In other countries, it's very easy to have an investment property. Often times there are property management companies that will do all the work for you, for a percentage of the rent. It's often affordable.

In Quebec, however, this is not an option. Unless you own many properties, and they generate a lot of income, then it's just too expensive to hire a property management company. For instance, if you rent out a property for $1000 a month, a management company will take at least $200 from you each month. They often don't handle everything either.

Also, if you only have one property to rent out and you want it insured, you will most likely have to pay for it yourself. You can't force your tenant to get insurance. I phoned insurance companies for quotes, and I was told it would cost around $300 for a policy that would cover fire, water damage etc. I was worried what would happen if my tenant burnt the building down. It was a townhouse condo, so if it burnt down, and thus damaged all the neighbours houses, the costs could have potentially fallen on us.

So if you want to have a company manage the property for you, and you want insurance, then after all your bills (in our case $300 a month for property tax, school tax and condo fees) you will not be left with enough money to realistically call it an investment.

But all of the above are the least of your worries when it comes to renting your property out in Quebec. This province has insane laws that protect the tenant beyond what I would call sane or fair.

You are supposed to provide your tenant with a lease. While there is a section that includes the date (start and end), it's completely irrelevant because there is only a beginning to a lease, never an end. In other words, the lease is automatically renewed every year forever, or as long as the tenant wants to live there.

Although it is "your" property, and "your" investment, the tenant can do pretty much whatever they want in there. It is illegal to force someone to give a damage deposit. Therefore, if they destroy your property it becomes your responsibility to get the money off of them to pay the damages. If the tenant is on welfare, it is highly unlikely that you will get anything back at all.  I spoke to several people at the Regie du Logement and they all said the same thing. It is also illegal to force a tenant to give you post dated cheques. Also, although technically you own the property, you can't ever get rid of a tenant unless it's through eviction for valid reasons or because you or a close family member (sibling, parent or child) plan to move in. Therefore, if you decide that you no longer want to be a landlord and would like them to leave so you can fix up your property and sell it, too bad! They can legally stay there as long as they pay rent. Period. So if you decide to sell the place, you are at their mercy every step of the way. Every time you want to go to the house to do any repairs, schedule potential buyers for visits etc. you have to give the tenant 24 hours notice. You therefore cannot ever guarantee that the house will look clean and presentable.

If you have a problem tenant, that's where things get really fun in this province. If your tenant is three weeks late in paying the rent then you can go to the Regie du logement and file an application for $66. Then approximately six weeks later there is a hearing. If the tenant has paid the rent and court fees then the case is closed and the tenant can stay. If the tenant pays the rent late every month then you are supposed to send them at least three letters asking them to pay on time. If they continue to pay late, then you can file an application, again for $66, and then in six weeks there is a hearing. If you can prove that the tenants late rent payments cause you "injury" (in other words, if it's your only property and you rely on the money to pay bills etc.), then they might evict the tenant.
If you own multiple properties and do not suffer financially at all, then it's less likely the court will side with you. 

Approximately 99% of the time the judge will issue a court order which states that the tenant must pay their rent on time from now on. If they default on the order then they will be evicted. However, they can also appeal the verdict and cause delays. The laws have changed a little over the last couple of years though, and a tenant can't cause delays unless they have valid reasons. It's a lengthy process every step of the way. If the court decides to evict the tenant, then it's still not an immediate thing.  If the tenant is on a six month lease then they are given 30 days to move but if it's a year lease then they get 3 months.

The 30 days starts from the date on the verdict though, so even though you wait two weeks for it to be mailed to you, the date on the verdict is a week earlier. So that only gives the tenant 3 weeks to find a new place to live (if they have a six month or less lease). That is the only aspect I've seen in the laws that harms the tenant.

In my situation, we stupidly rented to someone without doing thorough background checks. She was a single mother with four children on welfare. To make matters worse, she had no job history, bad credit (which she told us up front) and no history of apartments she'd lived in. We demanded references, and when I phoned them both up, it was obvious that they were fake as they were unable to answer any of my questions properly, to the point that there were pauses and whispering in the background!

Warning bells went off in my head, and I definitely did not want to rent to this person. However, there were three other people who owned the property with me and I was outnumbered. Everyone else wanted to give her a chance. They felt sorry for her, and felt that sometimes people just need a break.

She paid us the first months rent before moving in. After that, however, every single month there after she was late. In all fairness, after 3 or 4 months we could have taken her to court and had a court order forcing her pay on time or else she'd be evicted. But we didn't know our rights at the time, and thought it would get better. It didn't.

After 7 months of late payments, we wrote a letter to her telling her we needed the money on the 1st. Then we had numerous conversations with her every few months telling her the same thing. Every month she had excuses. She was sick, her kid was sick, she couldn't make it to the bank, or sometimes it was just that she didn't have the money. She changed her phone number every few months and hardly ever answered the door so getting in touch was very difficult. Consequently, month after month we were left waiting at least a week for the money, never knowing when we were going to get it.

We let it go on for two years, with numerous letters, and phone calls. Each time she would say she'd change. I wanted to file the application after a year and a half into the lease, but was outnumbered again. This time the tenant was pregnant and the others didn't think it would be very nice to evict her at that time. So we gave her a "final" chance. We wrote another letter saying that we were going to file an application for eviction with the Regie if she continued to pay her rent late and that we were being nice trying to give her as many chances as possible.

She continued to pay late (in two years, she only paid the rent on time twice). After three more months of late payments we finally filed an application with the Regie du logement. She was absolutely frantic when she got the copy of the application and realized that we were trying to get her evicted.

She said that from now on she would pay us with post dated cheques. She also gave us money to pay for some of the damage her and her family had caused. Someone had kicked in the front door, and it was damaged beyond repair. It was secure, but needed to be replaced. She gave us $1000, which covered the cost for the door. However, there was also about $1000 worth of other damage which we never received.

So we had two post dated cheques from her, and she had given us the damage money to cover the front door. She seemed like she was really making an effort this time. We told her that if she paid us all the money for the damage and our court fees that we would cancel the application. However, on the day before we could cash the first cheque she called us up and told us not to cash the cheque because the money wasn't there!

That proved to us that she wasn't going to change, so we didn't cancel the application. At the court hearing the judge sided with us, as we had 10 or 11 receipts in the last year showing late rent payments. The tenant was not at all apologetic and acted like we were evil bastards for trying to steal money out of her kids mouths (by asking for the money to pay for the front door she damaged!) and by being so strict about asking for the rent money on the 1st.


The judge asked if there was an alternative date that could work for all of us, instead of always having to pay on the first of the month. We told the judge that in fact, we had tried to change the date before. I think we tried making it the third, or possibly even as late as the seventh. We tried it, and it didn't work.

The judge asked her if there was any way she could pay on the first of the month as the lease stipulates. She was unable to convince us or the judge that she could. So she was evicted.

As could be expected, she was very bitter about the whole thing and was very hostile with us when we went to her house after that. We expected rent money while she was still living there (even though legally she was only allowed to live there for half the month). Legally, we were entitled to a full months rent. She refused to give it to us. She simply asked us how she was supposed to pay for somewhere else to live and pay us too. As if that was our fault!


Two weeks before she was supposed to be out of the property one of her relatives called us and begged us to let her stay until she found a new place to live. I was against the idea, and had no sympathy after the way she had treated us. But once again, I was outnumbered and everyone else thought that it would be kind to let her stay in the property for a bit longer as she had so many children and they didn't want to see them end up on the street.

A week before the date that we had agreed was the absolute longest she could stay there I contacted her to inquire as to whether she had found a new place to live. At that point it became obvious that she had no intention of leaving and that if we allowed her to stay any longer then the court would consider her a tenant again and a new lease would have to be drawn up!

So we had to hire a bailiff. This was yet another lengthy and expensive process. When we contacted the bailiff, he took two days to deliver a notice to them saying that they had 3 days to move out, starting on Monday - apparently weekends don't count!

Of course, they still hadn't vacated the property after the 3 days. So the bailiff had to hire a team of movers to physically remove all of their belongings - all at our cost! Total cost for the bailiff was about $1100. 

Once the bailiff had insured that everything was gone, I was then left with a destroyed property.

All of the walls in the house were ruined. The place was initially covered in wallpaper, but with so many kids living in the house (it turned out that there were actually two combined families living there - so 10 kids, not 4) and all of the wallpaper was ripped and/or colored on with markers. There were numerous holes kicked and punched in the walls. Several of the doors were ripped off the hinges and very damaged, some beyond repair. The house had wall to wall carpet on two floors, it was all ruined with dirt, stains and burns. The basement was finished cheaply with vinyl floor and the walls weren't drywall. It was all ruined, the flooring was damaged, the walls were all buckling and had holes in them. 

It cost us thousands of dollars to fix up the property to sell it. Money that we were told by the Regie that we would not likely get back as the tenant was on welfare.

Which leads me to yet another reason not be a landlord in this province, at least if you are English. When you phone the Regie du logement you will never get to speak to someone who's mother tongue is English. They will speak English to you, but their level of comprehension is negligible. Therefore, you don't feel like you are getting accurate information. Many of the documents on their website are only available in French. When you receive the court verdict, the whole thing is in French. I don't even think you can obtain an English version, so have to rely on google translate. I had phoned them several times asking the same questions and I received different answers each time! They didn't understand what I was asking them! I actually got one of my friends to call them, as she is fully bilingual. I gave her a list of questions I wanted answers to. Well, the answers she got were once again different from all the answers I'd been given.

At the end of this experience, I've learned that you have to be well informed before becoming a landlord in Quebec. You need a lawyer, because the internet is filled with websites written in Frenglish legalese. There isn't anyone you can call for free accurate legal information. The Regie are not especially helpful unless you speak French. We phoned tenant hotlines but they were more knowledgeable about tenant rights. We phoned the Canadian housing and mortgage association because they have information on landlord and tenant rights. But they were useful only to a certain point.

Next, I would never rent to anyone unless they LOOK AMAZING ON PAPER. In other words, DO NOT be fooled by nice appearances or great personalities. Scam artists know how to say all the right things and put on a great show. What matters is what is on paper. Have an application form ready for them to fill out and read it carefully. Phone the references and have a list of questions ready to ask them. If they are their previous employers ask them specific questions like how long they worked there, when they started, when they left, why did they leave, were they punctual, did they get along with people, were they competent at their jobs. If it's a previous landlord, ask them how long the tenant lived there, when did they move in, when did they leave (by asking for dates you are getting specific and it will be easier to detect a liar) did they keep the house clean, did they pay their rent on time each month, were they noisy, were there any problems at all? Then do a credit check, and check for a criminal record. Although legally you can't refuse someone based on their record you can tell them you have found someone else if you don't want to rent to them.

I believe that people deserve chances too, but when you are trying to run a business (and that is what being a landlord is) you have to be logical and stick to the facts. You can't allow your emotions or feelings about the person influence your decision.

Until Quebec changes the laws to be more pro landlord though, it is just not worth the hassle. First off, landlords should have the right to demand a $2000 damage deposit before the tenant is allowed to move in. They should also be allowed to refuse people to have pets, and that if they get pets you can evict them. Same as smokers. Why is it that if you want to stay in a hotel for one night you aren't allowed to smoke unless it's a smokers room? Landlords should have the right to evict a tenant if the house and lease contract are not being respected. It should be a straight forward case that goes to court and results in eviction quickly. In other countries if you want to sell your property and need the tenants out so you can fix the place up, you simply write a letter and give them three months notice. I know, because it happened to me twice! Both times, I simply had to pack my things and leave. There was no choice, I couldn't go to court. But I understood, the owner needed his house back! That's life!

If a tenant is a pig, and you see cockroaches and you know they are ruining your house, you should be allowed to evict them! If a tenant can't pay the rent you should be allowed to contact a debt collector who will seize their personal belongings and retrieve the money for you. Most landlords are not going to want to spend years of their lives and thousands of dollars in court and bailiff fees to try and get a few thousands bucks in damages and unpaid rent. Tenants know this, and thrive on being able to get away with so much.

If you walk into a store, you can't trash the place or you will get arrested. Yet, it's ok to trash a house you rent. It doesn't matter, landlords are rich, who gives a crap about them? If you go to a restaurant, you have to pay for your meal. Or if you stay at a hotel, you have to pay for your room. Otherwise you could be arrested! Yet in Quebec, tenants can stay for at least a month in a place without going to court, and even when they are evicted (a process which takes at least 3 months) they can continue to live there rent free for at least 30 days, plus the extra week and a half it takes for the bailiff to act.

All I can say, is that unless the laws change eventually there won't be anywhere for people to rent anymore.

Quebec is known to have some of the most pro tenant laws in the world, so think carefully before deciding to become a landlord here!

10 comments:

  1. It is excellence. Quebec increase the best system about rental properties. It create well valuation of travelers and that wants.
    appartement à louer québec

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  2. I was with you until you said "landlords should be able to do whatever they want....it's THEIR house."

    Speaking as a lifetime renter (have no desire to have the headaches or financial burdens that come with owning a property), once you rent your property to someone, it is no longer "your house." It now becomes the tenants domicile/home.

    I've always been a model tenant. We keep our place clean and tidy, always pay our rent on time, never cause problems and the only time you will hear from us is when their is an issue with the rental. HOWEVER, I've rented from a few landlords with the same attitude as you and I'll tell you what happens from a tenants perspective.

    1 place I lived in, the heaters didn't work (we moved in the summer and didn't notice until it started getting cold and it was a mild year). I notified the landlord the middle of November that none of the baseboard heaters were working (in fact had a whole list of issues that never got fixed on move-in. mostly small stuff). Two weeks later, still nothing and the temperature dropped to -20. We were using our oven for heat, blankets, etc. The landlord still wouldn't come to fix it. I filed a complaint, which took another week (this was in New Brunswick) for the Rentalsman to come and "inspect" the place. They did and drafted an order to the landlord to fix the heat (which took another week) and gave the landlord 3 days to fix it. 3 days came and went and it took another week for the rentalsman to step in again. This time they gave them the day to fix it or they, the rentalsman, would fix it themselves and bill and fine the landlord.

    This got the landlord in gear and they sent someone out. The guy was completely rude and complained about being pulled away from "an important job" and proceeded to tell me that I was right, the baseboard heaters didn't work but he needed "approval" from the landlord to purchase them and he wouldn't be able to get them until Monday (this was Friday and the overnight temp had dropped to -30). I called the Rentalsman again (by this time I had a personal contact) and I don't know what they did but an hour later the grumpy repairman was back with a truckfull of heaters.

    When we moved out, the landlord tried to with-hold our deposit for the damages that I mentioned earlier. Lucky enough, I had previous experience with the rentalsman and made a phone call and had a check the next day.

    Another instance, a different landlord shut off our water for, in their own words "minor maintenance" without notice. This was on a Friday morning. I noticed all of the workers had left when I got back from work and our water was still off Friday evening. I contacted the landlord and was basically told to suck it up until sometime on Monday. This was in a building of 12 units. I got the other tenants together and we all went to the landlord saying we would all be renting motel rooms for the weekend and filing complaints to get re-imbursed. The landlord got the water turned back on.

    As we speak, right now at an apartment I'm renting in a high-rise in Longueuil, I've been without hot water for 4 days, was told it will be at least another 2 because it's "the weekend you know." And was pretty much verbally assaulted because the girl working the office downstairs today "just wanted to go home and have a shower and get ready for her big date."

    TBC

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  3. (continued)

    I have a couple of more stories like this and could keep going. You can see that there are plenty of bad landlords out there and that's why the tenancy laws are so strict. That and there were plenty of slumlords back in the day, so if you want to get upset at someone, blame them. Don't take it out on your tenants. Most of us are good, hard-working people who simply want a peaceful, enjoyable home without the hassle of shovelling snow, cutting grass, replacing roofs.

    A tenancy is a very delicate balance. As a tenant, I always pay my rent on time, follow the by-laws of the rental, and am always respectful and quiet. However, in exchange for this, I demand that my landlord is always respectful, keep the property well maintained, fixes issues as they arise and in a timely fashion and keeps the other tenants in line. Not too many landlords follow these rules or even remotely abide by them, yet they're there every month with their hand out looking for "their money."

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  4. I totally agree with everything you have said. I grew up in apartments and had some bad landlords myself. In one building they used to turn the heat down to 60F overnight. I used to have to sleep with several extra blankets to keep warm. They would lock the laundry room earlier than the time posted thus locking in my clothes for the night, and then sometimes open the room late. They wouldn't remove snow from the drive way for most of the winter and it was only slightly clear due to people driving in and out and parking. The halls in the apartment building were dirty. When things were broken we had to wait a while before they were fixed. For years my front door wouldn't shut and lock properly and one night someone was trying to get in but thankfully I had locked the door properly that night!

    I have had many friends and family that have suffered incredible hardships, like yourself, by negligent landlords and it's terrible. Over the years there have been many slumlords that have taken advantage of people and I'm aware that this is why the laws are strict.

    However, I believe that a system should be fair. When you are paying rent you deserve to have everything working perfectly all the time. I think that it's unfair that if something is broken and you fix it yourself that you can't deduct it off of your rent! It's a landlords responsibility and job to fix things as quickly as possible.

    As landlords we were very fair. If there was a problem my boyfriend would go over right away. We lived up the road from the property so after work he'd go over and fix whatever was broken. One time we had to call a plumber to fix a toilet. We sorted it out right away. We respected our tenants rights and expected the same thing in return.

    But in the end, it was us who had to pay for all the damage. We had to hire a bailiff to evict her as she would not leave. She called us up with a sob story saying she had nowhere to go and would be out on the street so could we please give her another two weeks to find a new home. We agreed (as I mentioned, I do think that three weeks is a little unfair to expect someone to find a new home) but on the condition that they pay us Septembers rent. They were supposed to move the first week of September and we let them stay until the end of September. However, as the end of the month neared it was clear that she still hadn't found anywhere to live and had no intention of moving.

    Therefore, we had no choice but to hire a bailiff. This was still a three day process during which time she was still living there, rent free. She never paid us Septembers rent.

    The bailiff had to hire a team of movers to remove all the debris she left in the house. At our cost, of course. This took several hours.

    The end result was a disgusting damaged property. The carpets were ruined beyond repair. They were so filthy and stained that we had to rip them all out. There were holes punched in several rooms. Several doors and door frames were damaged to the point that they had to be replaced. The basement walls (wood paneling) were destroyed and had to be removed. The list goes on. It cost us thousands and thousands of dollars to fix everything, along with our time (it took almost a year). We were unable to claim a penny off her.

    So in that respect, laws need to be more fair for landlords too. The money to pay for damages should have come out of her welfare cheque. I think it's only fair to be able to ask for a damage deposit, but you aren't allowed here in Quebec.

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  5. Hello Dear Land lord,
    I really liked your article, this should be sent to press .
    I am a new Land Lord in Quebec just 6 months ago I got a triplex, Two of the apt were already rented .
    One of the Tenant who was pure French and Quebecois realized soon that I am a new Land lord and New in Canada. He just paid me for the first month and then stopped paying without any reason , He was so racist and abusive at all times to me , He was using my place to sell drugs and kept about 12 dogs in a one bedroom apartment,, He and almost 10 friends used to come every night for Drugs and smoke and made my life and My family's life like a hell. My daughter was just 1 month old when I moved to that building as a Land Lord.
    Now let me explain how the Police or Regie helped me.......Zero help .
    I call 911 about 5 times and no one interested to even hear than some one is selling Drugs 24/7 in my building, I could see all kind of people coming and going within a minutes in my building.
    I called Regie , Paid all the fee, Had to wait about 4 months without rent, Without Hydro Bill ( As he was not paying his bills and I am supposed to pay them now as I made the mistake of being the Landlord in Quebec)
    I was able to throw him out after 4 months , paid more than a thousand to a Bailiff,My property is fully destroyed, Just Imagine 12 small and big dogs in one bedroom apt and 10 smokers, For them my property was a junk place to come, smoke, drink, pee and destroy.After he was gone it was impossible to even go inside the apt , It was full of Dog shit and pee, broken doors, Broken walls and destroyed floor. About 6 inches big holes in the floors, I dont know what the hell they were doing on the floor.
    But No one helped me , The guy is gone, No one knows where. He was on Welfare so There was not point to get the money , I will not give that apt again on rent, Its better to pay all my mortgage myself instead of going through all that trouble.
    DO NOT BECOME A LAND LORD IN QUEBEC,NEVER GIVE YOUR PROPERTY TO A FRENCH RACIST QUEBECOIS. I wish some one had told me this before I purchased that property. I wish Regie reads this, I wish Police reads this

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    1. with a judgment against tenant you have up to 10 years to collect the unpaid rent with interest. People's circumstances can change in those 10 years. Sit on the debt for a bit and then hire a co. to find them, ie Localisation Quebec. Give them the details on the application and any other pertinent info that will help find them. Look on Linkedin, facebook to find them. Always keep at least a recent copy of a rent cheque for bank info. Car licence plate, etc.

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  7. Jeez! Landlord-ing in the states can be rough but nothing like this. What you figured out and what I think your partners haven't figured out is that it's not about being nice. It's business. There shouldn't be any emotions in it at all. No emotions when buying the property, none when selecting a tenant and none if, unfortunately, there's an eviction.

    Sorry you had a rough time of it

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  8. I am the landlord (no partnership). But Quebec is really bad. Especially Longueuil... I have a Triplex here, (7.5 years as a landlord in Longueuil). I went through all those troubles myself. My first purchase was in Laval (Condo 3 1/2) it is a great location, I bought it in 2005 (Landlord over 12 years). I only had 1 tenant who was too young, and he cost me 3-4 months of rent. I have a tenant who is also young. And the best tenant I ever had... Sometimes I forget to collect the rent from him... He wires me over the net (the last day of the month-1-2 days early-) ;).

    I would really like to advice the new wanna be landlords. In Quebec, Do not be a landlord. You have no rights (on documents you have a lot of rights) But not really.

    I am trying to sell my Triplex in Longueuil, I will go back to be a tenant in a nice location.

    Stay away from Longueuil, (Depends where you live, maybe around the university might be good). The rest, too many Junkies, a big percentage on Well-fare.

    Best of Luck

    Ati

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  9. 2000$ deposit? In this day and age when 80% of Canadians live paycheck to paycheck, even the home owners, LOL good luck with that.

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