Opinion: Sometimes, corporate landlords are better than mom and pops – The Globe and Mail

Rob Csernyik is a 2022 Michener-Deacon fellow and a contributing columnist for The Globe and Mail.

Not every renter has a landlord horror story, but I’ve collected several like trading cards. Two who refused to spray for bedbugs, one who rented me an apartment littered with used syringes and another who reversed a rent discount and demanded back pay are only a few of the property owners I’d love to forget.

Each was a small-time “mom and pop” landlord, the sort traditionally viewed as more humane, or at least less avaricious, than the asset management firms, pension or private equity funds or REITs who are their corporate counterparts.

These days, stories of landlords’ worst impulses, whether rapacious rent increases or renovictions, aren’t confined to one category or the other. Yet I feel too little focus exists on the relatively unchecked status of smaller landlords. This helps them evade detection when renting out poorly kept properties, operate without clearly defined processes other than what the law broadly prescribes and take advantage of or create finicky rules for tenants. In comparison, the stricter procedures and greater transparency offered by corporate landlords look like a step up.

Recently in The Atlantic, Alexander Ferrer suggested concern from tenants and advocates over corporate ownership of rental properties doesn’t stem from higher housing costs, but from the idea that “it magnifies the imbalance of power in the relationship between landlord and tenant.” Part of rebalancing this power and creating added security for tenants has been standardized processes and checks, imposed by law.

These mandated practices that exist for corporate landlords should be applied to smaller ones, too. Upping the table stakes of entering the landlord business to include more standardized procedures might be the trick to combat this behaviour from small landlords that I’ve experienced.

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Consider security deposits, which in theory have clear regulations, but in practice (to my financial detriment) have been approached more malleably by former landlords, with one glaring exception. Before selling his property, my New Brunswick landlord took a mellow approach to his job. Since I had to beg him to sign a lease instead of making a gentleman’s handshake agreement, I felt uneasy about the prospects of seeing my deposit again. At least, until I learned about the unique bureaucracy that exists in New Brunswick for such funds. Landlords do not hold deposits, the province’s Residential Tenancies Tribunal does. They can even be paid directly at government service centres.

When I vacated my Saint John apartment, I applied online for my deposit return and received a cheque by mail a few weeks later. The program isn’t without faults – it does not pay interest on deposited funds to renters, for example – but the terms for return were clear. The property management firm that took over my building had relatively limited recourse to file a claim against my deposit than other landlords I have had. This removed anxiety and uncertainty from the deposit process, and made me feel like a more empowered tenant.

Landlords get to demand credit reports, references and proof of employment from tenants, which they use as signals to gauge tenant quality. Yet, while tenants can sometimes glean useful information online about corporate landlords, there’s an information deficit about small-time landlords.

In Toronto, through the RentSafeTO building registration program, the city uses standardized criteria to assess rental property conditions and offer evaluation data freely to the public. But the program only applies to apartment buildings with three storeys or more and 10-plus units. This means information for large swaths of private landlords remains in the shadows. (Nationally, in 2020, nearly 8 per cent of Canadian families declared rental income when filing taxes – an increase of 335,850 families over 2008.)

Ideally, all landlords, regardless of size, would be subject to such third-party reporting in every community. When seeking freely available information on a past problem landlord, I found him mentioned only briefly in a decade-old news story about one of his properties. He also was mentioned in a listing on Rate The Landlord, a website that tries to close the information gap through crowdsourcing. The single review on him was too vague to provide valuable information to prospective tenants.

Imagine the difference if tenants knew how many and what properties a landlord owned, how long tenants lived there, the recent rental price history for their chosen unit and the number of complaints to municipalities about the building. Sharing this, and other key data, can help demystify the rental search process and represents a great opportunity for municipalities large and small. They could build it into landlord registration as key parts of this data are already easily accessible to municipalities and provide reports freely to renters.

Doubtless, mom and pop landlords will be annoyed by the added bureaucratic layers that further professionalizing the rental business will entail. But every entrepreneur encounters checks and balances. That’s part of doing business. Given Canada’s wild rental market, any measure that better informs and protects tenants is worth considering.