Welcome to part six of the Strathmore Housing Crisis series. This mini-series documents several stories told by Strathmore and area community members detailing many aspects and perspectives around Strathmore and area's current housing situation.
Community members have been sharing many stories about the struggles of finding housing in Strathmore, as a lack of availability and rising costs have made it seem impossible for anyone to secure a stable housing situation. While the stress on tenants and prospective renters has undoubtedly been incredibly challenging, tenants aren't the only ones struggling with rising costs, as this also impacts landlords.
Dan Cormeau, a property manager at Cormeau Management and Realty, explained things like utilities, taxes, and insurance going up 15-20% per year for the last three years have resulted in landlords having to increase rent prices to match their costs.
Increased housing prices are a huge multifaceted issue with many layers, with landlords falling right in the middle. Among these are government policies and factors outside of landlords' control, such as interest rising from 2% to 6% over the years.
"What people may perceive as landlords being greedy, they're just seeing one step of this trickle effect from policies and procedures and whatnot from the government that's happening. There are some drastic increases in costs for landlords that must be covered. Otherwise, there's no money, they go belly up, and a lot of landlords are facing financial hardship with increased mortgage payments."
Cormeau added this is "a very oversimplified scenario" and there are many nuances and details that go into this, but essentially what it boils down to is the rising prices landlords are facing does unfortunately reflect onto the tenant. Expanding on the idea that landlords are often portrayed as greedy, Cormeau said the portrayal of some multi-million dollar corporation ballooning their own profits at the expense of the middle class is often untrue.
"For some of my clients who only have one investment property, that's their life savings. They have worked every day of their life to chip away and to put it in these investments for their retirement funds or what have you. There's really not much room for much error. With costs rising, it trickles down unfortunately to the tenant, and it's easy to vilify the landlord but they're not fully understanding the picture."
Landlord risk assessment
With the housing market in its current state, Cormeau said landlords have been extra cautious about renting their property out, as rising costs means any damage to their property could be a big loss. This means anything that could potentially pose a risk could be a huge roadblock for a tenant trying to find somewhere to live.
"If they may have a little bit of lapse in employment history or if they have pets or anything else that might make it more difficult [...] it's almost impossible for them to find a place," he said.
"Their tolerance for risk when they're already getting squeezed goes down, right? So having pets is a risk that some of my clients are not willing to allow, and it does increase management costs."
As far as the pet situation goes, some feel this bias is unfair, as some pet owners say their well-trained pet shouldn't be lumped in with a destructive pet. Unfortunately, Cormeau said this doesn't make too much of a difference in the landlord's perspective.
"Even if they're the best-trained pets out there, the flooring will still wear out much quicker. I tell my clients: if you're going to have a rotation of 15 years for flooring, expect to only get 10."
As a result, smaller landlords may be quite picky in who they choose, but as far as Cormeau and his company go, he says they do a screening application process instead to eliminate bias and profiling of any kind. So while Cormeau Management and Realty wouldn't turn you down for having a pet, what instead ends up happening is many places just won't allow pets to begin with, as they don't want to promise a pet-friendly property only to turn you down for having a pet.
"It just so happens that if I post a listing that does approve pets, the listing usually goes very, very quickly because so many applications flood through. As soon as they (the property manager/landlord) get one that's good, where the references are good, you got a good work reference, they got a good landlord reference, they're good to go."
When will we see a solution, and how do we get there?
As for when we could see some relief, Cormeau warns we may be in this for at least the next couple of years, as he believes it would take 5-10 years for things to get more affordable and easier for people. He believes the solution lies in pushing forward more affordable housing that is both accessible and attractive. A solution that would benefit both the landlord and the tenant would be larger-scale living units, such as the proposed townhouses for Bayside Place.
"We need to have well thought out buildings with nearby amenities where building amenities are balanced with the size of the units. It's really a tricky, tricky thing, but definitely, there is the economy of scale, right? So if they build larger units, it will make things more affordable, and it also makes things more affordable for upkeep, for maintenance. There's a premium charge for a single detached home versus a multifamily unit, my client would pay less per tenant."
The "scale of economy" Cormeau refers to is the idea that multi-family maintenance is far easier and more affordable than individual units, as things like garbage, among many others, are considerably more efficient. By building high-quality multi-family units, Cormeau believes this will help tenants looking for affordable housing and also help the landlord manage a sustainable business without putting financial stress on the tenants.
To make this happen, Cormeau believes the primary driving force has to be the government. Not only does there need to be a significant push to build more housing, but the communities have to be high quality too. If the push for affordable housing results in low-quality buildings with no amenities people won't be happy, which leads to issues like graffiti, vandalism, and more. He believes Strathmore is doing a great job as far as community quality and amenities, but emphasized that a push for affordable housing needs to happen immediately. While the Bayside Place development is definitely promising, it's hitting some snags in the development and Cormeau believes this needs to be expedited and built as soon as possible.
Cormeau admitted he doesn't have all the answers, as he isn't a politician or developer, but strongly believes the answer lies in these multi-family homes and hopes to see Strathmore build more property soon.
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