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Bad tenants, or a rush to cash in on higher rents? Data analysis we conducted on applications filed with the Province of Ontario showed the number of landlords applying to have tenants evicted are on the rise. Interesting enough, most of the growth in applications are not evictions for non-payments, and they’re concentrated in areas where rents have been rising the most.
Applications for tenant eviction from landlords across Ontario are growing. The province saw 4,893 applications, a 1.76% increase from the same month last year. Toronto saw 1,323 of those applications, which is actually a 2.93% decline from the same month last year. Let’s break down those numbers to find out why landlords have been applying to evict tenants.
Source: Government of Ontario, Better Dwelling.
More People Are Paying Their Rent On Time
The number of L1 applications received by the province is down. An L1 application is an application to evict a tenant for non-payment, and to collect owed rent. In June the province saw 3,875 L1 applications, a 0.48% decrease from the same month last year. So more people across the province are paying their bills on time – that’s not the problem.
Breaking that down for the City of Toronto, the same trend applies. The province received 1,047 L1 applications in Toronto, a 2.69% decline from the same month last year. If you’re a tenant, soaring prices are a pretty good motivator to get your payments in on time.
More Landlords Are Applying To Evict Tenants For Other Reasons
The rise in evictions is in the L2 filings the province has been receiving. L2 applications are to evict tenants for reasons other than non-payment. These can be anything from damage to property, or just not-renewing leases. The province saw 1,018 L2 filings, a massive 11.37% increase from the same month last year.
Source: Government of Ontario, Better Dwelling.
Breaking down the L2 applications for the City of Toronto, this trend didn’t apply. The city saw 276 L2 applications, a decline of 1.07% from the same month last year. This means the ratio outside of the city skews a little higher.
Sale prices of Toronto real estate have been on the rise, but rents haven’t moved all that much. The rest of Southern Ontario wasn’t so lucky, with cities like Kingston seeing a 5.3% increase. Since the majority of application growth was not for non-payment, one wonders if these are landlords looking to cash in with higher paying tenants. We’ll dive through some more applications and see what we find.
With contributions from Stephen Punwasi.
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This happened to me. Got an eviction notice, the owner said they were moving into the house. I happily packed up and left, saw the same place listed for about 30% more.
Going to the tribunal to gets you a month or so of rent back, but the cost of living skyrocketed 30% higher – so after 3 months you end up losing even more money.
Rental protections in theory sound nice, but it’s such a fight to get your rights enforced against small landlords. Then the landlord hates you, and it becomes so uncomfortable you need to move out anyway.
The province needs to focus on building more purpose built rental buildings, otherwise young people are going to stop moving here. It’s not like they can afford to buy in this market.
Agree with the purpose built rental. the catch is the government needs to own the units (which is a great investment for the province/city anyway) and would be a cashflow positive investment whilst assisting in – somewhat – controlling rental prices in the region.
It could also be that people with rental properties in the suburbs have decided to sell the properties to cash in on higher real estate, before the crash comes.
What will be interesting in the data will be the number of these that are single family, condo, duplex and town units as opposed to purpose-built rental buildings.
If you were renting out a property that you bought for investment purposes, the new owners might demand vacant possession if they were buying for themselves.
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It is understandable that landlords may want to get rid of longer term tenants due to the fact that rent controls have held their rents below market. Landlord costs rise every year, if rent controls artificially hold rents below market landlords must sell or turn over tenants. Tenants would be better served with free market rents. As it is landlords and investors will not improve existing properties or build new. Tenants end up losing out.