Owning a rental property in Toronto can be both exciting and challenging. The demand for housing in Canada’s largest city creates a promising opportunity for steady rental income, but it also comes with rules, regulations, and responsibilities that every landlord should understand. When you handle your investment in the right way, you can avoid legal problems, keep tenants satisfied, and maintain a profitable property.
If you are thinking about buying or selling a property, or want expert guidance to succeed in Toronto’s real estate market, reach out to The Johnson Team. They are well-known for their strong reputation, in-depth market knowledge, and focus on client needs. Contact them to start working with an agent right away.
Below are five must-know tips for Toronto landlords who want to manage their rental properties successfully and get the most out of their investments.
1. Understand Toronto’s Rental Market
Knowing the local rental market is key for anyone looking to become, or remain, a successful landlord in Toronto. This city is known for its diverse neighbourhoods, unique cultural attractions, and wide range of housing options—from downtown condos to suburban family homes. Before you set a rental price, take some time to research average rents in the neighbourhood. Look at what similar homes, condos, or apartments are charging each month. Also, pay attention to market trends. During some months, rent prices might go up due to high demand or fewer available units. At other times, rent prices might level off or dip slightly.
Why This Matters:
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Competition: If your rent is too high, you might struggle to find tenants. If it’s too low, you may not earn enough to cover expenses or maximize your return on investment.
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Location Factors: Areas near public transit lines, schools, parks, and other amenities often command higher rents because these features make a property more attractive.
By understanding local market patterns, you can price your rental property competitively and make it more appealing to the right tenants.
2. Know the Legal Requirements
Landlords in Toronto have specific legal duties set by the Residential Tenancies Act (RTA) and other local regulations. The Landlord and Tenant Board (LTB) enforces these rules, so it’s important to follow them carefully. These regulations cover matters like rent increases, eviction procedures, and tenants’ privacy rights.
What You Need to Remember:
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Rent Control: In many cases, you cannot raise the rent by more than a set percentage each year. This limit changes annually, so stay updated by checking official government websites.
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Eviction Rules: You must have a valid reason to evict a tenant, such as non-payment of rent or causing serious damage to the property. There is a legal process you must follow, which includes giving notice and going through the LTB if the tenant refuses to leave.
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Privacy and Notice: In most cases, you must give your tenants at least 24 hours’ notice before entering their unit. Emergency situations are exceptions, but it’s best to be respectful and follow proper procedures whenever possible.
By following the law, you protect yourself, your tenants, and your property. Failure to comply can lead to complaints, fines, or even legal action.
3. Screen Your Tenants Properly
The best way to avoid problems later on is to be careful about who you allow to live in your rental property. Tenant screening can include credit checks, employment verification, and references from previous landlords. Be sure to follow fair housing laws, and treat every applicant equally during the screening process.
Key Steps for Tenant Screening:
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Application Form: Ask potential tenants to fill out a written application with their personal details and employment information.
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Credit Check: A decent credit score can hint at whether a tenant pays bills on time.
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References: Landlords should ask for references from past landlords or employers to learn more about the applicant’s payment history and behaviour.
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Income Verification: Make sure the tenant earns enough to cover the rent comfortably, so you are less likely to deal with late payments.
By selecting reliable tenants, you reduce the risk of missed rent payments, damage to the property, or other issues that can cost you time and money.
4. Set Clear Lease Terms and Maintain Good Records
A clear, detailed lease agreement is one of your most powerful tools as a landlord. It outlines what you and your tenant are responsible for, how much the rent is, when it’s due, and what happens if either side fails to meet their obligations. Clear terms can prevent disagreements and serve as a guide when challenges arise.
Topics to Cover in the Lease:
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Rent and Deposits: State how much rent is due, on which date, and whether there is a damage deposit.
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Utilities: Clearly identify whether utilities like heat, water, or electricity are included, or if the tenant must arrange these.
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Property Rules: If your rental has specific rules—such as noise restrictions, rules for pets, or smoking—make sure these are clearly stated.
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Maintenance Responsibilities: Spell out what you will handle (like big repairs or appliance issues) and what the tenant must do (like replacing light bulbs or cleaning).
Record Keeping:
Keep copies of every signed document, including the lease, any amendments, and letters or emails you exchange with tenants. Good record keeping will help you stay organized and avoid confusion later on.
5. Stay on Top of Maintenance and Communication
A well-maintained rental home keeps its value and makes tenants more likely to stay. Fixing small problems right away can prevent bigger, costlier repairs in the future. Whether you handle upkeep yourself or hire a property management company, it’s important to schedule regular inspections, cleanings, and repairs.
Regular Maintenance Checklist:
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Check the plumbing and electrical systems to spot issues early.
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Keep heating and cooling systems clean and serviced.
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Inspect windows and doors for drafts or water damage.
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Clean common areas if you rent out a multi-unit building.
Good communication with your tenants is equally important. Encourage them to let you know about repairs or other concerns as soon as possible. Be polite and professional when you respond to complaints or requests. Positive landlord-tenant relationships can lead to better reviews, longer tenancies, and fewer disputes.
Final Thoughts
Becoming a successful Toronto landlord requires more than just owning a property. You need to understand the city’s rental market, follow legal requirements, screen tenants responsibly, set clear lease terms, and keep your property in good shape through proper maintenance and good communication. By doing all these things, you can protect your investment and keep your tenants happy.
If you are looking to expand your rental property portfolio, or you’re ready to buy or sell real estate in Toronto, you do not have to do it alone. Contact The Johnson Team today to start working with an experienced agent. Jeff and Liz Johnson have assembled a group of real estate experts who understand the local market and offer personalised service.
Posted by Maryann Jones on
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