Despite rent being due in less than 24 hours for millions of people across the province, Ontario's official stance amid an unparalleled economic stoppage can effectively be summed up in the following sentence:
"We encourage landlords and tenants to work together during this difficult time to establish fair arrangements to keep tenants in their homes."
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Of course, landlords and tenants have long worked together to find "fair arrangements" whenever the need may arise, but never have they been asked to do so en masse. More than 750,000 Canadians have already signed a 'Cancel rent and mortgage payments during COVID-19' online petition, while groups like Parkdale Organize have started their own 'Keep Your Rent' movement. By all accounts, the province could very well be staring down a full-scale rental crisis.
The point is simply this, due to the coronavirus outbreak and subsequent work stoppage for many, for the first time in a long time an overwhelming number of renters in Toronto simply will not be able to pay their rent. And believing that all, or even many, landlords are in a financial position to let this pass is a mistake and a misunderstanding of a huge number of landlords in the province. Not every landlord is a multi-million dollar property owner, many are small-time investors, people using properties as retirement savings, and those who won't be able to pay their own mortgages if rent isn't received.
Owen Carrier, who works in the art department for film & TV productions, has seen his job opportunities completely dry up. He's lived in a house in Parkdale for the past two years that's been subdivided into four units with 11 total people living under the shared roof. And while they've all paid rent for April already, Owen's not sure what will happen if they can't do the same next month:
"We are concerned that our landlord, who's shown questionable financial stability, will have to sell the house leaving us to deal with perhaps a worse situation than an independent homeowner."
Of course, the province has suspended evictions, and Premier Ford has publicly declared that anyone in a crisis should not have to pay rent. But there's still been no official remunerative support for either tenants or landlords. In fact, the position of many seems to simply be painting the thousands of independent landlords throughout Ontario in the same light you might expect to see a Disney cartoon villain - namely, they're evil, money-grubbing, empathy-lacking soul-suckers who are incapable of caring about the present realities caused by the coronavirus outbreak.
According to OREA President Sean Morrison, "Small “mom and pop” landlords are particularly vulnerable to experiencing significant financial hardship if they cannot earn rent, especially during a prolonged State of Emergency. The Province of Ontario has an obligation to help the situation: allowing tenants security in their homes during the crisis is the right thing to do. However, this should go hand in hand with ensuring landlords do not similarly suffer financial hardship, lose their investments and exit the rental market altogether."
An example of this is Megan (who spoke to Toronto Storeys on the promise of anonymity) and her family, who live in a semi-detached home in Toronto's east-end. They're staring down a monthly mortgage of $4,300, of which, they count on their 1-bedroom basement apartment tenant to cover approximately 35%, with a $1,525 monthly rent. Knowing this, Megan proactively went to her tenant a couple of weeks ago to check in with them. Thankfully, they said they'd be able to cover this month's rent. When I asked Megan what her options were if her tenants couldn't afford rent, she pointed to either draining the family's savings or applying for another home equity line of credit (HELOC).
In other words, if her tenant can't pay, she and her family risk going into debt. This is the situation for a lot of small landlords throughout the province.
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Of course, there are large landlords and property management companies out there making an effort to connect with tenants who are struggling due to COVID-19. Shiplake for instance, owners and operators of purpose-built rentals in Toronto, are offering their tenants a digital gift card from UberEats for $100 (or a grocery gift card) in both April and May, in hopes that it helps them eat well during a lean time as well as lets them support local businesses also affected by the outbreak. CAPREIT, a real estate investment trust that manages over 65,000 residential rental apartment and townhouse suites across Canada is giving their tenants the option to use their last month's rent (LMR) to cover April rent. They will also defer rent on a case-by-case basis and have frozen any rental increases for the foreseeable future.
So it's not all terrible news. And kudos to every accommodating landlord, both small and big, who can – quite literally – afford to be. But it's not enough, and tomorrow the culmination of the government all but ignoring this building panic will likely come home to roost. Tenants across the country (and yes, landlords are tenants too) will not be able to afford to pay rent, and no matter how many mortgage deferrals are made, an economic shock-wave will shutter through the rental industry.
That said, it is again important to reiterate that no one can be evicted in Ontario right now. Tenants are protected in the short-term. Whether or not your landlord attempts to evict you when the Landlord and Tenant Board reopen is likely based on two things: your landlord's own financial standing, and your relationship with them. Renting, after all, has always been based on relationships – if you're a tenant and you don't have one with your landlord, now's the time to start. If you haven't already, send an email, make a phone call, reach out in any capacity. Connect.
In the meantime, if you're facing a financial hard spot, apply for relief now. The federal government has more than 10,000 civil servants working on both EI applications and the coronavirus emergency funding program.
It's important to remember that, despite everything, the rules remain the same: if you can afford to pay rent, pay it. If you cannot, you will be granted some reprieve, but for how long and at what cost no one seems to know.
Least of all – it seems – the government.
