So you’ve bought a house and want to rent out the basement. Maybe you purchased an investment property and are ready to rent it out. From advertising and showing to interviewing and building a lease agreement, check out these tips if this is your first time being a landlord in Vancouver.
Finding tenants
Many Landlords have successfully found tenants independently online, but be prepared for a random selection of prospective tenants. If an ‘overseas tenant’ offers to take your apartment without seeing it, be cautious – there are many sophisticated scams operating on sites like Kijiji and Craigslist. As with most things in life, if it seems too good to be true, it probably is. Viewit.ca is another great advertising site for Landlords. For $55 a month, your property will be showcased online to prospective tenants. Aim to list/advertise your property 2 months before it will be available to rent.
You can also work with us to find great tenants! We offer leasing services that include pricing, advertising, showing, screening, negotiating and paperwork (the total cost is usually one month’s rent, half of which is typically offered to the agent who brings a buyer).
Legal Suites
The City of Vancouver has several by-laws and rules that affect second suites, defined as self-contained rental units in a detached or semi-detached house. To be considered a legal suite, the space will need to meet certain standards:
- health and safety requirements; and
- fire and electrical codes
- residential zoning requirements;
- property and occupancy standards;
For Vancouver Condos, the Condominium Corporation will likely have rules that dictate rentals in the building (minimum lease terms, the obligation to provide a copy of the lease to the property manager, etc.). If you’re thinking of renting out your condo, make sure to get a full understanding of your restrictions and obligations.
What are standard rent prices in Vancouver?
The Vancouver rental market is in exceptionally high demand! This means that as a landlord you can afford to be choosier about who will rent your place and what they will pay. Here are some average rental rates as of 2018 in Vancouver. Keep in mind that these averages are based on a combination of highs for downtown core properties to lows on outlying areas like Mount Pleasant and East Vancouver.
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- Basement Suite $1,350
- 1 Bedroom Apartment $2041
- 2 Bedroom Apartment $2773
- 1 Bedroom Condo $2158
- 2 Bedroom Condo $3333
- 2 Bedroom Townhouse $1963
- 2 Bedroom House $2300
- 3 Bedroom House $3250
- 5 Bedroom House $4200
A good way to price your rental property is to check out comparable properties in your area. What have other units similar to yours rented for? One added advantage to using a real estate agent to help you price your place is that they will have access to plenty of rental history for your building and others.
Lease Agreement
The lease is the physical document that contains all of the conditions and requirements of your deal with the tenant – the rental amount, start and expiration dates, as well as any special provisions or rules (smoking, pets, cleanliness). So what is the difference between a lease and a month to month rental agreement? A lease commits both you and the buyer to a fixed rental term.
A standard lease agreement usually begins at 12 months and after that tenants are automatically converted to be month-to-month unless a new lease agreement is established. Monthly tenants must give 60 days notice before moving out and vice versa for landlords.
Lease Agreement Rights and Obligations
- Pets – Landlords can’t evict a tenant for having a pet, but they can refuse tenants based on this. The condo strata rules will also have overriding regulation over pets so if the tenant is in violation of strata rules, they can be evicted in this case.
- Increases in Rent – Landlords can increase the rent once every 12 months by up to a maximum equal to the Consumer Price Index (CPI) for that year.
- Right to Access Property – Generally, Landlords have the right to enter an apartment to maintain it, show it to buyers/tenants (with 24 hours notice) or in the event of an emergency.
- What if you want back in? – You may NOT move back into your condo or apartment during the term of the lease. If the tenant is on a month-to-month lease, you may provide 60 days notice in writing (counting from the 1st of the coming month) in order to occupy the unit (note: you or a family member must be the person occupying the unit – you cannot simply give notice to the tenant in order to allow someone else to move in).
- What Happens if You Want to Sell – If you have a valid written lease, you may NOT evict the tenant in order to sell the property. The lease simply transfers to the new owner (at the current rent and terms). If you have a ‘month-to-month’ tenant, you may give the usual 60 days written notice to the tenant, on behalf of the new buyer (assuming the new buyer is moving in themselves).When a tenanted unit is sold to a new Buyer and the existing owner gives notice to the Tenant on the new owner’s behalf, compensation is not required
How to screen tenants
Before you commit to a potential tenant make sure have candidates apply via email and set up a formal meeting where both parties can ask questions and learn more about each other. You can also have tenants prepare the following materials for you:
- First and last month’s rent (ideally as a certified cheque or bank draft).
- Confirmation of employment letter
- References, Previous addresses and landlord names/contact
- Details of any other people who will reside in the apartment
- Whether you intend to bring any pets in to the suite
Ready to Become a Vancouver Landlord?
Taking on a tenant can provide a great source of supplementary income to use against your mortgage or to free up some capital. Just keep in mind that finding and keeping tenants will require upkeep and work as well. Do the research in advance so you are prepared for all of the added requirements in advance.
