Adding an Income Suite to your Blue Mountain Home

Posted Oct. 12th 2011 under Real Estate Trends

Let's face it, homes in the Blue Mountains only seem to be going up in price. In this four season 'resort' town, a popular alternative is to add rental suite for additional income. Whether the kids have all moved out, or you've thought about renting a space in your home to help with the mortgage, creating a second suite, and becoming a landlord, can have many advantages.

While the most obvious benefits are the financial ones, developing a Blue Mountain Rental may give you a sense of pride and responsibility, help derive a greater sense of safety and perhaps even provide a social or community atmosphere.

If you're thinking about renting space in your home, there are many things to think about, and lots of work to be done. The following information talks about legal and safety considerations, plus tips on finding great tenants.

Legal & Safety Considerations

How to Prepare

Before you place an ad in the paper, start installing a stove or get a set of keys made, you need to find out what exactly makes a secondary suite legal. Make sure you check with your local municipality for the zoning bylaws - don't wait until you've put time and energy into building a second suite to find out if you're even allowed to have one! If you've purchased a home with an existing second suite, you need to make sure it stands up to fire code requirements and planning standards. The Landlords Self-Help Centre in Toronto suggests two extra steps to further reduce liability once you've legalized your second suite:

1. Make your insurance provider aware of the second suite and enhance your insurance coverage accordingly.
   
2. Ensure your mortgage holder is informed about your second suite.
   

Once your Blue Mountain Rental is Ready

There is only one thing you need to think about now, the legal responsibilities of being a landlord. Before you start to look for renters, you need to make sure you understand all your legal responsibilities as an acting landlord. Some of the things you'll need to know include:

1. How to comply with Fair Housing Laws, and not discriminate against anyone.
   
2. How and when to make necessary maintenance repairs.
   
3. Once rented, when and why you are allowed to enter the suite.
   
4. Rent increase laws and how to inform tenants of an increase.
   
5. How to serve an eviction notice.
   
6. What a lease/renters agreement should look like and include.
   
7. In order to educate yourself on the legal responsibilities, you should contact your municipal government for help, as well, check your yellow phone book for any landlord or housing agencies listed under Social Services.
   

Tips on Choosing Tenants

In a Resort town like the Blue Mountains, be wary of 'seasonal' tenants (ie: young dudes just looking to snowboard for the winter, and take off once the snow melts).

The best thing to do is to create a list of basic information (monthly rent, size, advantages such as location or new appliances), so you don't forget anything when talking to interested people over the phone. As well, you should have an application form ready to email or handout.

The law is definitely on your side when it comes to choosing tenants. There are many great services available to make sure you have sufficient information to make a decision. Credit checks are a great way to see an applicants history and confirm his or her actual identity.

Doing a credit check is not something to be overlooked because of the fees involved. The tenants you choose might appear to be wonderful people, but when it comes down to it, you need to know more about them before you let them into your home. You have the right to ask for and contact references and past landlords. You can even ask for their banking information, in order to obtain their history. While you can ask for income information, it is only legal to do so if you also ask for rental history, credit information and get approval for a credit check (making a decision based on income alone would be discrimination).

Don't just "go for the green" when choosing tenants. It's up to you to find trustworthy, reliable renters, but its just as important to choose renters you get along with. Once you have applicants that have passed the tests mentioned above, there are helpful ways to decide between tenants:

1. Set up a short interview, which will enable you to see what they are like, and allow for open communication between both parties.
   
2. Make sure to ask questions about their lifestyle habits. For instance, if they play an instrument, find out if they are willing to restrict playing it to certain hours.
   
3. Is their personality compatible with yours, and other family members that live in your household?
   
4. Do they have pets? If you have pets, are they allergic?