Do you own an Okanagan rental property and are uncertain about how to deal with your rental and tenants during the COVID-19 outbreak? Here are 5 tips to manage your investment risk and do right by your tenants.
Reach out to your tenants - if you haven’t already done so, don’t wait any longer to get in contact with your tenants. Ask your them about their situation and if they anticipate temporarily losing their job or having reduced hours of work.
Be flexible and offer solutions - what we are experiencing with the COVID-19 is unprecedented in recent times. Every tenant may have a different situation. Some tenants will continue to have consistent employment income and/or have a solid financial footing to be able to continue to pay rent in full and on time. Other tenants may experience true hardship and an inability to meet their contractual obligations. In some situations perhaps a tenant would be best to explore more affordable accommodation but for most they probably just need some breathing room until they return to work or resume regular hours.
Consider offering tenants flexible solutions such as offering tenants the option to terminate their lease without penalty (if they want to find more a lower cost rental) or negotiating a payment plan that would see current rent payments (or par of rent) either deferred until an agreed upon later date or spread out over the course of the rest of the rental term. You may even consider a modest reduction to rent if your situation allows. Please remember these are extreme circumstances. I encourage you to protect your interests but to think with empathy and compassion for your tenants.
Document and record everything - in order to protect your interests it is important to document every conversation you have with your tenants. Make sure to record any agreed upon rent reductions or payment plan in writing. Ensure that you clearly state that any of the aforementioned agreements are for the purpose of providing relief during the COVID-19 outbreak only and do not constitute an amendment to the original tenancy agreement.
Defer your mortgage payments - call your bank or mortgage lender and inquire about deferring your mortgage payments. You may not feel this is necessary but the future is absolutely unknown. Now is not the time to think, “This won’t affect me.” Give yourself some breathing room so that you can feel comfortable extending the same to your tenants or provide additional support to your family and friends during these times.
Defer your utility bills - call your utility companies and inquire about deferring your utility bills. If your tenants pay their own utilities make sure that they have inquired about this themselves before or as part of the conversation you have about offering them relief.