{"id":157402,"date":"2025-03-26T08:57:24","date_gmt":"2025-03-26T08:57:24","guid":{"rendered":"https:\/\/peraltafinancing.com\/business\/real-estate\/which-tenant-qualifications-are-realistic-in-2025\/"},"modified":"2025-03-26T08:57:24","modified_gmt":"2025-03-26T08:57:24","slug":"which-tenant-qualifications-are-realistic-in-2025","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=157402","title":{"rendered":"Which Tenant “Qualifications” Are Realistic In 2025?"},"content":{"rendered":"


\n<\/p>\n

\n

The definition of \u201cqualification\u201d is highly subjective, is it not?<\/p>\n

How does one\u00a0qualify<\/em> for something?<\/p>\n

In theory, a pre-determined set of criteria would exist, and if the individual meets this criteria, then he or she \u201cqualifies.\u201d<\/p>\n

But\u00a0who<\/em> makes up those criteria?<\/p>\n

And\u00a0who\u00a0<\/em>could deem that criteria to be \u201cunfair,\u201d and why?<\/p>\n

Over the last several years, I have written far more articles about the rental market than ever before.<\/p>\n

We still do our quarterly\u00a0<\/em>look at the Toronto rental market, the last installment of which can be viewed here: January 27th, 2025: \u201cHow Is The Downtown Rental Market?\u201d<\/a><\/p>\n

But aside from the rental market statistics, I\u2019ve found we have continued to come back to the topic of the rental market in general, over and over, most notably as it pertains to the following:<\/p>\n

    \n
  1. The process of securing a tenant.<\/li>\n
  2. Issues between landlords and tenants.<\/li>\n
  3. Issues within the \u201csystem,\u201d ie. the enforcement of the Landlord & Tenant Act<\/li>\n
  4. Qualification of tenants.<\/li>\n<\/ol>\n

    Last fall, I wrote the following:<\/p>\n

    September 16th, 2024: \u201cThe Problem In The Rental Market That Nobody Will Talk About\u201d<\/a><\/p>\n

    This was a long-overdue discussion about the stark dichotomy between the Ontario Human Rights Commission\u2019s \u201cProhibited Grounds Of Discrimination\u201d and the realities of today\u2019s rental market.<\/p>\n

    The blog post produced 36 comments so the readers seemed to enjoy it, but since then, more and more issues in the rental market have come up.<\/p>\n

    One of the largest issues I see out there at the moment is the idea of \u201cqualification.\u201d<\/p>\n

    It\u2019s a moving target.\u00a0 Or rather, it\u2019s a target that runs larger or smaller, depending on the individual and a target that some claim to hit before they\u2019ve even bothered trying.<\/p>\n

    Today, I want to ask about certain elements of the\u00a0traditional<\/em> \u201cqualification process\u201d and see if they\u2019re still reasonable in 2025.<\/p>\n

    While part of this blog and the subsequent criteria might seem like satire, I assure you, it\u2019s not.<\/p>\n

    I still work on at least 10-15 rental listings per year, and each and every time, dealing with the agents and the prospective tenants who think they \u201cqualify\u201d is an absolute nightmare.\u00a0 Maybe some know they don\u2019t qualify and don\u2019t care, but others seem to have absolutely no clue in the world.<\/p>\n

    Or maybe\u00a0I\u2019m\u00a0<\/em>the problem.\u00a0 Maybe\u00a0my<\/em> \u201cqualification criteria\u201d is just too stringent.<\/p>\n

    Remember the episode of Seinfeld where George is mulling over potential career paths for himself?<\/p>\n

    At one point he says to Jerry, \u201cWhat about a play-by-play announcer for baseball?\u00a0 You know how when we watch games, I usually make really good comments?\u201d<\/p>\n

    And what does Jerry tell him?<\/p>\n

    \u201cWell, George, you know those jobs typically go to former baseball players and, well, you know\u2026\u2026..people who are IN broadcasting.\u201d<\/em><\/p>\n

    Do you see a parallel here?\u00a0 Am I asking for too much when I define \u201cqualifications\u201d for tenants?<\/p>\n

    You decide.<\/p>\n

    Here are the most basic wants, needs, asks, and \u201cqualifications\u201d that a landlord could have of the prospective tenants in 2025\u2026<\/p>\n

    \u00a0<\/p>\n

    1) Having a job.<\/h3>\n

    Does the lack of a job preclude an individual from meeting the \u201cqualifications\u201d necessary to rent a condo?<\/p>\n

    This is a serious question.<\/p>\n

    As insane as it might seem to you or me to think that, somewhere, somebody will argue that an individual need not be\u00a0<\/em>gainfully employed in order to rent a condo, it seems that many people think it\u2019s totally normal.<\/p>\n

    Here\u2019s an email I received two months ago, with the names changed:<\/p>\n

    \n

    Hi David,<\/p>\n

    I have clients interested in your condo listing at (address).\u00a0 I wanted to run their profile by you before I book a showing to see if your landlord would be ok with this.<\/p>\n

    Bob and Susy have just arrived here in Canada from (country).\u00a0 They are both looking for work but are highly employable in their fields.\u00a0 Bob is a software engineer and Susy is a website designer and they are currently interviewing for jobs and are both very confident in their ability to secure work.\u00a0 They each have earning power of up to $100,000 per year.<\/p>\n

    As they are both new to the country they do not have any credit profiles we can share but we can show you their bank accounts back home in (country) and a history of their prompt payments to landlords back home.<\/p>\n

    Let me know if we should move forward with our appointment viewing.<\/p>\n

    (Agent Name)<\/p>\n<\/blockquote>\n

    Is this acceptable to\u00a0you<\/em>, as a landlord?<\/p>\n

    The potential tenants are \u201chighly employable\u201d but lack employment.<\/p>\n

    I don\u2019t know and I don\u2019t care what provincial or federal legislation or rights commissions say about this; I simply have no problem going on record with the fact that (gulp!) I think it\u2019s reasonable to consider\u00a0employment<\/em> as a qualification criterion for a prospective tenant.<\/p>\n

    \u2013<\/p>\n

    2) Having a credit history.<\/h3>\n

    Is it discriminatory to say \u201cno\u201d to a potential renter because he or she has no credit history?<\/p>\n

    I don\u2019t know.\u00a0 I\u2019m actually asking this.<\/p>\n

    I\u2019m sure that according to some \u201crights\u201d watchdog, somewhere, this would be discriminatory, and while I recognize that newcomers to Canada can\u2019t be expected to have a credit history with Equifax or TransUnion, should it really fall on the shoulders of the individual\u00a0landlord<\/em> to take on the risk.<\/p>\n

    Should it?<\/p>\n

    While I understand that there\u2019s a portion of society who deems all investors and landlords \u201cevil\u201d for having the audacity to invest in real estate, own property, or take a financial risk with their after-tax dollars, but here on planet earth, I think it\u2019s reasonable for a property owner to set a realistic set of evaluation criteria in place for a prospective tenant.<\/p>\n

    Having a\u00a0credit history<\/em> is exactly that: realistic.<\/p>\n

    Now, if a prospective tenant is gainfully employed and in possession of a job letter, has been at the job for three months or more (ie. the typical probation period), but has only been in Canada for 3 1\/2 months and doesn\u2019t have a credit profile\u00a0yet<\/em>, then I still think it\u2019s up to the discretion of the landlord.<\/p>\n

    I would also add that while anything can be faked these days, having a credit profile for a prospective tenant is one more layer of protection for the landlord.<\/p>\n

    \u2013<\/p>\n

    3) A reasonable number of people for the space.<\/h3>\n

    This is another example of, \u201cI can\u2019t believe we\u2019re having this conversation,\u201d but you can\u2019t imagine what we see out there these days.<\/p>\n

    You also can\u2019t imagine how many email inquiries I receive and subsequently\u00a0delete<\/em>.\u00a0 Go ahead, tell me that\u2019s disingenuous.\u00a0 Tell me I\u2019m not \u201cworking on behalf of my client.\u201d\u00a0 But trust me when I say, as it pertains to the latter, I\u2019m doing everything I can to protect them\u2026<\/p>\n

    Case in point:<\/p>\n

    \n

    Dear Mr. Bosley,<\/p>\n

    We are formally expressing interest in the property located at (address).<\/p>\n

    There are three of us, all single males, all employed in the technology sector, relocating to Toronto for June 1st, 2025.<\/p>\n

    We would be interested in setting up a virtual viewing of the property.\u00a0 \u00a0Please advise on next steps.<\/p>\n

    (No Name Provided)<\/p>\n<\/blockquote>\n

    First of all, I\u2019m\u00a0flattered<\/em> that this individual thinks I own Bosley Real Estate, but alas, I am not \u201cMr. Bosley.\u201d<\/p>\n

    But more importantly, this email was received through Realtor.ca, via the affiliate Rentals.ca, for a property we had listed with the following criteria:<\/p>\n

    -Junior One-Bedroom
    -One Bathroom
    -401 Square Feet<\/p>\n

    Again, I will ask you to define \u201creasonable.\u201d<\/p>\n

    In doing so, we might, just maybe, hone in on the idea of \u201cqualifications.\u201d<\/p>\n

    Notably, do THREE individuals \u201cqualify\u201d to rent a 401 square foot condo with a single, open concept bedroom?<\/p>\n

    While I understand that three individuals could \u201clive\u201d in here, and by \u201clive,\u201d simply mean \u201csustain life,\u201d I don\u2019t think it\u2019s unreasonable for a landlord to deem these tenants \u201cunqualified.\u201d<\/p>\n

    Just as an individual without a\u00a0job<\/em> might be unqualified in the eyes of a landlord, I would argue that\u00a0three<\/em> people living in a bachelor condo would also not meet \u201cqualifications.\u201d<\/p>\n

    \u2013<\/p>\n

    4) Identification.<\/h3>\n

    A scammer could fake a LinkedIn profile, right?<\/p>\n

    Of course.<\/p>\n

    But when you\u2019ve got an individual with a 14-year history on LinkedIn, having worked for three different global corporations, and having endorsements from a dozen other individuals with lengthy LinkedIn histories, it\u2019s a lot less likely that this person is fake.<\/p>\n

    And a scammer could fake a driver\u2019s license or a passport, right?<\/p>\n

    Sure.<\/p>\n

    But any of us can check an active Ontario Driver\u2019s License here: https:\/\/www.dlc.rus.mto.gov.on.ca\/dlc\/enter-details<\/a><\/p>\n

    How about a work permit?\u00a0 What about a permanent resident card?<\/p>\n

    Would it surprise you to know that many prospective tenants don\u2019t provide\u00a0any\u00a0<\/em>identification up front?\u00a0 What\u2019s more is that many prospective tenants\u00a0refuse<\/em> to provide identification when asked, many of their agents citing the illegality of even asking.<\/p>\n

    Call me naive, but any bona fide tenant looking to rent a Toronto condo should be scanning two pieces of personal identification and submitting it with the offer.\u00a0 Failing this, it\u2019s up to the landlord to decide if the identification is necessary for the tenant to \u201cqualify.\u201d<\/p>\n

    \u2013<\/p>\n

    5) A reasonable GDS ratio.<\/h3>\n

    Go on, say \u201cgotcha.\u201d<\/p>\n

    Put me on the front cover of the Toronto Star.<\/p>\n

    As you may know from reading my blog in 2024, the Ontario Human Rights Commission has\u00a0prohibited<\/em> discrimination on the grounds of any sort of \u201cminimum income criteria,\u201d especially as it pertains to\u00a0ratios<\/em>.<\/p>\n

    Even though\u00a0everybody<\/em> uses some sort of ratio as the most basic form of the qualification process, this is, in fact, prohibited.\u00a0 Have a read, HERE<\/a>.<\/p>\n

    But the amazing part is, if you look on a\u00a0federal government website<\/em>, you\u2019ll read the following:<\/p>\n

    \n

    Rent Within Your Budget.<\/strong><\/p>\n

    Spending too much on rent may make it difficult to cover your other expenses or save for the future.<\/p>\n

    In general, your rent and household-related expenses should not be higher than 35% of your gross household income. Your gross household income is all income you receive before taxes and deductions. For example, if your gross pay is $4,000 a month, limit your housing costs to $1,400 a month.<\/p>\n

    Making a budget will allow you to identify your income and expenses and know what you can afford.<\/p>\n<\/blockquote>\n

    This is an excerpt from a hilarious section on the Government of Canada\u2019s website called: \u201cRenting An Apartment Or House.\u201d<\/a><\/p>\n

    I know, I know, this is actually\u00a0good advice<\/em>.<\/p>\n

    But it\u2019s part of a page that contains a lot more information, like the following:<\/p>\n

    \n

    Outfitting Your Place.<\/strong><\/p>\n

    If you\u2019re moving out for the first time, you may need to buy:<\/p>\n

      \n
    • furniture<\/li>\n
    • dishes<\/li>\n
    • kitchen utensils<\/li>\n
    • small appliances<\/li>\n
    • bedding<\/li>\n
    • towels<\/li>\n
    • cleaning supplies<\/li>\n<\/ul>\n<\/blockquote>\n

      No, come on!<\/p>\n

      Really?<\/p>\n

      This is what our federal government is spending time on?\u00a0 Setting up web pages that help to prepare Canadians for the brutal realities of living alone, such as having to buy their own dishes and cleaning supplies?<\/p>\n

      Man, if only we taught this in\u00a0school<\/em> these days instead of constantly telling kids to find ways to be offended, aggrieved, or marginalized.\u00a0 Because once upon a time, we didn\u2019t need the federal government to tell people to purchase\u00a0furniture<\/em> when they rent a property.\u00a0 I wonder how federal jobs were created to oversee this website?<\/p>\n

      In any event, the fact that a provincial website decries the use of \u201cdiscriminatory\u201d income ratios while a federal government website tells us, \u201cyour rent and household-related expenses should not be higher than 35% of your gross household income<\/strong>,\u201d is an irony not lost on me.<\/p>\n

      So I ask once again: is it reasonable to use a GDS or TDS ratio as a \u201cqualification criteria\u201d in 2025?<\/p>\n

      It looks like two of our branches of government disagree on this, but for the rest of us, I would argue that it\u2019s completely reasonable.<\/p>\n

      There are just many, many tenants out there that never got this memo.<\/p>\n

      Ask me how many times an individual with a $45,000 per year salary applies to rent a $2,400 per month condo.\u00a0 Ask me how many prospective tenants submit an offer on a condo when their GDS ratio is 64%.<\/strong><\/p>\n

      Is it reasonable in 2025 to use this as a qualification criterion?<\/p>\n

      \u2013<\/p>\n

      6) Not having wages garnished or debt consolidation.<\/h3>\n

      I\u2019m not making this up, folks.<\/p>\n

      And you can argue that this is simply a \u201csign of the times,\u201d or that \u201cToronto is expensive,\u201d but I would also argue, as I have in the past, that an individual who is massively in debt and going through debt consolidation should be living within his or her means.<\/p>\n

      Here\u2019s a great email:<\/p>\n

      \n

      Hi Dave:<\/p>\n

      I have a client who is interested in your loft listing which looks amazing!<\/p>\n

      I wanted to run her profile by you first though since some other agents have said their landlord wouldn\u2019t be interested.<\/p>\n

      She is a single female and very responsible personally and financially, but she had an ex-partner who got her into some money troubles and now she has a lot of debts but they aren\u2019t really hers.\u00a0 He left her in the lurch and she owes money on a lot of different credit cards and lines of credit but she is working with Farber Debt Solutions which is a licensed insolvency trustee and if you read their reviews you\u2019ll see that they genuinely set out to help people in debt turn their lives around so we hope that you won\u2019t hold this against her.<\/p>\n

      Let me know if we should book a viewing for this weekend.<\/p>\n

      (Agent Name)<\/p>\n<\/blockquote>\n

      I mean, you tell me: would\u00a0you<\/em> follow up on this?<\/p>\n

      Would\u00a0you<\/em> email the agent and ask for more details?<\/p>\n

      \u201cHey Brad, how much debt is she in?\u00a0 What are her monthly payments?\u00a0 Are her wages being garnished?\u201d<\/p>\n

      No.\u00a0 Of course not.<\/p>\n

      Unless you\u2019re simply here on this earth to\u00a0help<\/em> people, that is.\u00a0 But then again, if you\u2019re in the position of \u201clisting agent,\u201d you\u2019re supposed to be\u00a0helping<\/em> your landlord client; not a person who is in massive financial trouble.<\/p>\n

      Sorry, I guess I had my heart removed from my chest not too long ago\u2026<\/p>\n

      Call me old-fashioned, but I believe in personal responsibility and I believe in living within one\u2019s means.<\/p>\n

      I\u00a0still\u00a0<\/em>buy boneless skinless chicken in bulk at Costco and put them four-to-a-bag in my freezer because I know I\u2019m saving about 60-70% off retail, and I know I go through a\u00a0lot<\/em> of chicken!<\/p>\n

      Why do people with massive personal debt think it\u2019s their God-given right to rent brick-and-beam lofts in downtown Toronto?<\/p>\n

      \u2013<\/p>\n

      7) Actually viewing the property before expressing interest.<\/h3>\n

      Believe it or not, the real estate community remains split on this one, and it\u2019s far from the \u201cchicken-and-the-egg\u201d debate.<\/p>\n

      There is a\u00a0right<\/em> way to do things, and because so many people out there don\u2019t want to do things the right way, an argument is being formed that the\u00a0wrong<\/em> way is\u00a0right.<\/p>\n

      As I have written on TRB many times before, there are a slew of leasing agents out there today who won\u2019t show a condo to a tenant-client unless the listing agent for that unit \u201cpre-approves\u201d the tenant in advance.<\/p>\n

      What does this mean?<\/p>\n

      Well, essentially the leasing agent, instead of showing the condo and\u00a0then\u00a0<\/em>submitting an offer to lease along with supporting documentation, will first<\/em> email the listing agent with the supporting documentation and say, \u201cPlease read through all this and let me know if you and your landlord would consider my tenant-client.\u201d<\/p>\n

      It\u2019s ridiculous.<\/p>\n

      Ridiculous, not only because today\u2019s leasing agents have become lazy and entitled, but also because to ask any listing agent to \u201cpre-approve\u201d a tenant would open a discrimination case if the answer was \u201cno\u201d for any reason.<\/p>\n

      Call me old-fashioned and call me naive, but I think that the process is as follows:<\/p>\n

      1) Find a property in which your tenant-client is interested.
      2) Show the property to the tenant-client in person.
      3) Submit an offer to lease the property, complete with credit check, rental application, employment letter, identification, etc<\/p>\n

      In recent years, leasing agents have turned this around.<\/p>\n

      Here\u2019s an email I recently received:<\/p>\n

      \n

      Hello,<\/p>\n

      My client is\u00a0an AAA\u00a0tenant\u00a0with a Good credit score and has an Annual\u00a0income of\u00a0$74,000 <\/strong>($50,000 Annual Income, $24,000 Investment Income )\u00a0plus other income\u00a0annually.\u00a0<\/strong><\/p>\n

      Applicant is looking to lease starting March 15, 2025.\u00a0<\/strong><\/p>\n

      Tenants:\u00a0Total 1 Female<\/strong><\/p>\n

      (Tenant Name)<\/strong>\u00a0is \u00a0currently working as Digital Activation Manager.<\/strong><\/p>\n

      She also have about $37,000 Invested in Canadian Market<\/strong><\/p>\n

      Please let me know if it can be considered, I can then book\u00a0a\u00a0showing and send an offer.<\/u><\/p>\n

      (Please find the attached IDs, Employment Letters, Payslips and Credit Reports)<\/em><\/p>\n<\/blockquote>\n

      The fact that this says \u201chello\u201d tells me that it\u2019s a copy-and-paste email that\u2019s been sent to a slew of listing agents.<\/p>\n

      So let me get this straight: my job as the listing agent is to review the supporting documents for a prospective tenant who not only has yet to submit an offer to lease, but hasn\u2019t even viewed the unit, and then<\/em> tell the leasing agent to go ahead and book a viewing.<\/p>\n

      Nope.<\/p>\n

      Not gonna happen.<\/p>\n

      My job is to protect my client at all costs, and working like\u00a0this<\/em> is asking for trouble.<\/p>\n

      Just imagine this phone call to a reference:<\/p>\n

      \u201cHi, um, Dwight, my name is David Fleming and an acquaintance of yours has put you down as a reference.\u00a0 She\u2019s looking to rent our condo, and while she hasn\u2019t submitted an offer yet, or even viewed the property, well, um, I guess I wanted to know if you think she\u2019s a good person?\u201d<\/em><\/p>\n

      This is not how it works, but unfortunately, there are so many leasing agents who think it\u00a0should<\/em> work this way, that there are massive disagreements about this on real estate agent Facebook groups, and even some seasoned agents think this is how things should go.<\/p>\n

      I had obtained some screenshots of these discussions on Realtor Facebook groups to share, but a friend of mine from one of the groups said it would be in poor taste, even if I blacked out the names.\u00a0 Such is life.<\/p>\n

      But do we really need screenshots of these conversations?<\/p>\n

      \u201cThe sky isn\u2019t blue.\u00a0 It\u2019s not.\u00a0 I don\u2019t care what you say.\u201d<\/p>\n

      The discussions are like\u00a0that<\/em>.<\/p>\n

      \u2013<\/p>\n

      Phew!<\/p>\n

      Alright, I just took the time to read through the post after writing it, as I always do.<\/p>\n

      There\u2019s definitely a \u201ctone\u201d inherent, and I think some of you might be thinking something like this:<\/p>\n

      \"\"<\/p>\n

      Yes, maybe I am.<\/p>\n

      The Toronto rental market continues to deteriorate as landlords require\u00a0more<\/em> from tenants since fraud is at an all-time high, but simultaneously, tenants want to provide less<\/em>.<\/p>\n

      Corners are being cut at every opportunity.<\/p>\n

      This isn\u2019t going in the right direction!<\/p>\n

      I know some real estate agents who specialize in the rental market, specifically working with tenants, and these are some of the hardest-working people in the business.\u00a0 It\u2019s a grind, it\u2019s thankless, and it\u2019s a tough way to make a living.<\/p>\n

      But kudos to the \u201cgood ones\u201d out there, and if you\u2019re a prospective tenant, trust me when I say that you will benefit from hiring a professional.\u00a0 The problem is: they\u2019re so few and far between.<\/p>\n

      To the landlords out there: keep doing what you want, when you want, and how you want, and never compromise.<\/p>\n

      Happy Monday, folks!<\/p>\n