That is brutal! Why and how are these laws made? Is it because tenants have been making more noise over the years to the MLAs?
Thanks for the comment Jerry… I mulled over your question while working throughout the day and had a moment of inspiration…I really should be preparing for a presentation but once you have an epiphany..you have to go with it.
So here’s the theory: Believe it or not…Toronto contains the second most hi-rise buildings in North America (New York is number 1). Following WWII modern apartments were the most popular form of housing during the post war boom not only in Toronto, but all over Ontario (this is the biggest difference I see between Alberta and Ontario..we have thousands of big concrete apartment buildings).
More surprisingly the current Toronto condo boom was smaller in comparison to the post war boom (According to CMHC 1968 multi-unit housing starts peaked at nearly 30,000 units and multi-unit starts dominated the market for nearly 20 years after that..last I checked the current condo boom peaked at under 20,000 starts).
So here’s the situation faced by provincial MPP’s in Ontario during the times the landlord laws were drafted: A significant portion of Ontario’s housing stock was apartment buildings owned by the private sector. Stories of landlord abuse started to flood the media (there are some really bad apartment building owners here). This is not the greatest situation and the government’s job is to deal this huge red flag by introducing some red tape.
The problem is that the laws are old and don’t reflect current realities. The population of Ontario grew significantly and the current rental housing stock could not keep up with growth. Smaller investors seeing the rents going up start buying houses as rentals to satisfy the demand. The smaller investors were entering into a market where the ‘regs’ are designed to protect tenants from really wealthy and powerful real estate investors with legal teams.
Can you see the problem here for us?
So you may ask the question: Why don’t they just change the ‘regs?’ You can ask that about any government, Alberta and Ontario alike. Changing any ‘reg’ is not sexy…the media doesn’t care that some forward thinking MPP unearthed how all these crazy ‘regs’ combine to make things difficult for us real estate investors..he won’t get any new votes for doing this, he’s better suited spending his time trying to get his name in the paper by being the heroic politician.
Brian Persaud from Real Experts Inc has been a REIN member since 2005 and currently owns property across Ontario, Alberta and Florida.