For Newcomers Renting in Canada, Here's What You Need to Know
Luckily, newcomers can search for a rental before coming to Canada. Companies (like our site Rentals For Newcomers) are great renting resources for finding and leasing your first rental home in Canada before you arrive.
Sites such as Prepare for Canada offer loads of information not only about potential cities where newcomers might consider living and renting, but also how to search for a career and setup your banking (and start building your credit history in Canada, which is very important).
Still, the fact is most renters visit potential rental properties in person, or have friends, family or a paid real estate agents do it for them.
The overwhelming majority of Canadian property managers and landlords are legitimate and honest. However, it’s vital that you ask a lot of questions in order to avoid scam artists.
Be careful and be aware.
Friends and family that have already settled in Canada can be an invaluable resource when renting that first home as a newcomer so consult with them or take them with you. You don’t want to be scammed.
Remember, there is no such thing as a stupid question when it comes to signing a lease.
First, check out the vacancy and occupancy rates
As Anjali Rego points out in Prepare For Canada, “vacancy rates are a key driver of rental housing costs in Canada…when you are aware of housing costs, you can decide where you want to live and how much you can afford.” Occupancy is also a factor in rental prices.
So what are occupancy and vacancy rates?
The occupancy rate, writes Rego, refers to housing demand, while the vacancy rate refers to housing supply. A high vacancy rate in the city means a greater housing supply. This, in turn, can reduce the cost of rental housing. A low vacancy rate in the city will contribute to higher housing costs.
The vacancy rate is the percentage of all vacant or unoccupied units available for rent at a particular time. So what's the “magic number” for good vacancy rate (meaning possibly lower rent prices for newcomers renting in Canada)? Generally, a healthy vacancy rate is considered to be around three per cent. You can check out this CMHC site for the latest data and get expert predictions for 2021 here.
High vacancy rates can work in your favour.
According to Rego, “landlords compete with one another to lease their property, Because of this, you have more vacant properties to choose from. When vacancy rates are high, landlords may offer incentives to prospective tenants to make the property more attractive.”
For example, landlords may:
- lower the rent
- offer one month’s free rent, parking, or internet
- offer upgrades.
Always remember: landlords are eager to find a tenant and might even agree to rent their properties to newcomers with a lower credit score.
Here’s where you should look
Tenants rights are important, and Canada has strict, enforced laws about this.
Most of the rental housing in Canada is rented out by property management firms or private landlords. Often, you will be negotiating directly with the owner of the rental.
Canadians typically search for rentals through a host of different websites to find apartments and houses listed for rent. In addition to rentalfornewcomers.com, sites used often include Rentals.ca, liv.rent, PadMapper, Kijiji, Craigslist or even local media websites.
Property managers of multifamily buildings and individual property landlords still display “For Rent” signs in front of their buildings or in the windows of a property they’re listing. It’s a good strategy to walk or drive through a neighbourhood that interests you and look for rental signage, which usually has a phone number to call. You can even inquire on the spot (and perhaps get the chance to see the rental immediately).
Here’s what property managers and landlords require
Generally, property managers and landlords will ask for these documents when you fill out a rental application:
- Bank statements (remember, setting up your banking in Canada is extremely important) to prove you have sufficient funds to pay the rent for at minimum three to six months.
- Proof of your annual income which is often in the form of pay stubs from your current or most recent employment.
- A credit check. Landlords want to know that you do not have a bad history. While it’s true that many newcomers do not yet have any Canadian credit history, this is not an insurmountable obstacle. But, again, building a good credit history in Canada should be part of any newcomer’s goals.
- References. These can come from previous landlords, your employer, or other trusted professionals and/or established family members.
Canada is a country of immigrants, and immigration is key to the continued health of the Canadian economy and way of life. It’s true that some landlords when renting will insist that they need to see Canadian documents, you will discover that there are many out there, specifically on rentalsfornewcomers.com, who are delighted and keen to rent to newcomers.
In many parts of Canada, and particularly in large cities such as Toronto and Vancouver, there is competition for popular rental locations so don’t expect to be given an apartment on the spot. Property managers and landlords often interview a variety of applicants before selecting the one they feel will be the best tenant. You may have to look at multiple places in your search for your new home.
Don’t forget to budget for moving costs
Do you need to pay a damage deposit?
A Security and Damage deposit is usually the cost of one month’s rent.
Because Canadian property managers and landlords have to follow strict rules and bylaws, they are most often honest about this but it’s good to check the regulations where you are settling. If you are in doubt, ask questions and consult family, friends and websites such as prepareforcanada.com.
The deposit is used to pay for any damage that happens while you live in the rental unit. It does not include damage that is beyond beyond your control, which would include external water damage and, of course, normal wear and tear.
Always remember: leave your unit in the same condition as when you moved in and you will usually get your entire deposit returned to you, with interest. To protect yourself from damage disputes, take and save pictures or video of the inside of your home, including appliances, on the day you move in.
Who pays for utilities and internet, cable and telephone?
Unless it is already included in your monthly rent price, you may have to pay fees to set up a new account with local utility companies, which can include electricity, heating, cable, internet, television or even a phoneline. Be aware that you may be required to pay a security deposit for these services.
Don’t forget to budget for these moving expenses
Newcomers renting in Canada can sometimes overlook these additional moving costs:
- Hiring a moving van/truck
- Hiring professional movers
- Purchasing packing materials, boxes, and tape
- Food and drink for friends and family who help you move
- Taking the day off work
What about renter’s insurance?
A standard renter’s insurance policy usually covers damage, theft, accidents and property loss. Most renters in Canada get renter's insurance and many landlords and buildings require it so it is highly recommended for newcomers as it protects and reimburses you in the event of an emergency.
It's important that you shop around and compare rates from different insurance providers.
Remember that while you don't own the space, you own the contents. According to Aha Insurance, tenant insurance provides coverage for three things:
- Your personal property (things you own, like furniture, electronics and clothes).
- Additional living expenses (if you have to live somewhere else while your unit is being repaired under a claim).
- Liability coverage (to protect you in case a person is injured or their property is damaged while they’re in your space).
Rental move in dates in Canada
In Canada, standard rental contracts often start on the first day of each month - though some may start on the 15th - so plan your move with this in mind.
It's common that as you move into your rental, the previous tenant is likely moving out the same day.
Most rental/tenancy agreements often specify that the previous tenant must be out with all of their belongings by noon on the moving day, with the rental left clean.
Don't forget to get as much help as you can, and also to return the favour when asked. Friends and family are usually happy to help. Just remember to feed and thank them for an important job well done!
Furnished or unfurnished
Most rentals in Canada come unfurnished and there is a substantial price difference between the two types of rentals.
With the usual unfurnished rental, basic necessities such as towels, bedding, pots, pans, silverware, etc. are your responsibility, not to mention the decorations and furniture.
So, it's important to plan and shop wisely for your needs. Check out garage sales, thrift stores, Facebook, etc. Lots of good free stuff can be found online.
Also, check whether your building has a Facebook page where residents post items to for sale or to give away for free.
Your renting rights as a newcomer in Canada
Landlord and tenant rights and laws can differ from province to province. All of the provinces and territories have their own rules and ways to settle disputes. Here's a handy spot to find all the Canadian tenants rights links you need.
There are however some rights that are standard across Canada. As a newcomer renting in Canada you need to be familiar with these:
- the right to at least 24 hours notice before your landlord can enter your residence
- a landlord cannot make additional rules or requests that are outside of the law, even if you initially agree to them
- a landlord does not have the right to leave any possessions in your residency
- a landlord cannot discriminate against you because of your race, ethnicity, religion, gender, sexual orientation, disability, or age (provided you’re over the age of 18)
- the right to have children living in your home
- the right to a safe home in good repair, with properly functioning water, plumbing, electricity, and heating
- the right to have the right to a copy of all documents relating to your tenancy
Be aware that your landlord is not permitted to raise your rent more than a certain percentage each year. Under normal circumstances and barring undo violations on your part, it is up to you, and not the landlord, to decide when you want to end your tenancy.
Of course, rules governing allowed rental price hikes differ across the country, but most average around a maximum of two to three per cent a year. British Columbia's maximum allowable rent increase of four per cent is currently the highest in the country.
Here's some additional links about newcomers renting in Canada that may help you in your search: