Toronto Landlords Face Colour-Coded Rating System

by | Dec 9, 2019 | Rental Property Management Tips

Toronto City Council unanimously adopted a colour-coded rating system modeled after the DineSafe restaurant rating program.

Apartment buildings will be subject to inspection, and beginning in March 2020, these rating cards must be displayed for prospective tenants. It is not clear what the specific reports will look like, however, the DineSafe program uses a simple green-yellow-red system to represent Pass, Conditional Pass, or Closed.

The move is part of an extensive bylaw enforcement program that was passed in 2017.

That policy requires owners of apartment buildings with three or more storeys or 10 units or more to supply a tenant notification board that alerts residents of upcoming improvements, to develop a long-term capital expenditure plan, and to prioritize and answer urgent tenant complaints within 24 hours, among other requirements. All apartments — including single basement units — remain subject to the city’s property standards.

At the time the bylaw was passed in 2017, a colour-coded system was discussed, but didn’t make it into the final draft. After extensive pressure from tenant advocates, City Council enacted the colour-coded system last week.

In addition to the rating system, Council also voted to hold landlords accountable for some of the costs of tenant displacement due to interruptions such as fires or floods.

While tenants hail the measure as a victory, there is concern that tightening regulations will have a negative impact on rental housing inventory. A recent survey found that, due to increasing property taxes and utility costs, 18% of Toronto investment property owners are merely breaking even on rental income, while 33% are losing money. That leaves many property owners with only projected increased property values to offset costs and raises concern that prospective investors won’t be able to make the numbers work.

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

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Disclaimer: The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

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