Hello, I’m looking at purchasing a 10 plex property and have some concerns about inheriting the tenants. Reason for having the building empty are Reno’s and increasing the rent to market value. Also installing 2 more hydro meters to allow me to charge for hydro usage. Can I purchase the property vacant ? Location Ontario Canada. Thanks
Hey @Justin Sleep , This has become nearly impossible to inherit an empty building if there are current tenants there. What we have done is build this into your timelines and exit strategy. So approach this knowing there will be tenants and come up with a game plan that will work for you!
@Melanie Dupuis any advice on a strategy ? Where would I find rules that apply for this type of property ? Thanks
Good morning Justin. I’m by no means an expert. But I have done a little research into this myself. The landlord tenant act in Ontario is very tenant friendly. It is possible to purchase a vacant property, however it is important to do your own research to avoid any legal problems. My understanding is that the current owner of the property needs to get the current tenants to sign form n11. You can imagine how difficult it might be to get all 10 tenants to voluntarily sign that form before the sale of the property. My realtor advised me to make the sale conditional on vacancy, the n11 being sighed and doing a walk through on the day of closing to make sure everyone and everything was out.
If you move a tenant out for renovations when you have completed the Reno you must offer your nice new apartment back to the same tenant at the same price. You can apply for a rate increase but it is insignificant. I think you also have to find them somewhere to live while their apartment is under renovation. But again I’m no expert. It is important to do your own research and talk to a real estate lawyer. ￼ i’m just sharing my opinion.
@Len Ayton thank you. I’ll contact my lawyer in the morning.
@Justin Sleep In regards to the rules, you can find that on the Ontario Landlord-tenant board website. Over a certain amount of doors in a property, the rules and payments you will need to give tenants changes when you issue the vacancy for repairs and maintenance forms. I suggest only 1 or 2 at a time. You do not want 10 empty units while doing renovations unless you can afford to service the debt without any rent coming in