With Canada expected to slide into a recession in early 2023 and the housing market softening, property investors are understandably worried. It’s important not to panic. There’s no denying that these are turbulent times, but there are ways to weather the storm.
Real estate deserves its reputation as a solid investment. Short-term shocks won’t detract from the value of your property over the long-term, especially if you take steps now to recession-proof your rental.
How landlords can prepare for the coming recession
Revisit mortgage rates
At the peak of last year’s real estate surge, variable mortgages became more popular than fixed rate as buyers scrambled to enter the market.
Property owners who didn’t want to become locked into fixed rates in a rollercoaster market may now want to rethink, however, especially given the Bank of Canada’s recent rate hikes. Consider talking to your mortgage broker or other mortgage professional about what the best move is for you right now.
Don’t be intimidated
The real estate market has endured many boom-to-bust cycles over the years so although it’s tempting to panic at pessimistic headlines, don’t let the market or the media scare you.
Unless you’re personally overextended, your property will continue to be a valuable and reliable asset over the long-term – especially in comparison to other forms of investment.
It’s not all bad news – renting is up
Being a landlord is on the rise as people look to rentals as a profitable source of passive income. With rents soaring and demand for housing growing, rental investments are now paying off in a big way for savvy landlords.
But don’t be tempted to take advantage of the housing shortage to hike your rates. Keeping rental prices comparable to similar properties in your neighbourhood maximizes your chances of finding reliable and trustworthy long-term tenants.
Address concerns with tenants
In a hot rental market many landlords make the mistake of taking their tenants for granted. But ignoring any issues by neglecting your tenant’s concerns merely pushes the problem down the road. Reliable renters are key to the profitability of your investment, so take care of them now to maintain your income for the future.
And if you’re looking for new renters, don’t skip the screening process. In uncertain times, you need to be sure your tenants have the means to pay their bills so be rigorous when checking credit history, landlord references, and employment.
Highgate Property Management offers complete tenant vetting and screening to give landlords peace of mind about who’s in their investment property. Our professional team handles everything, from credit checks to rent collection, so you don’t have to worry about chasing down payments or falling victim to the latest scam. We also handle any tenant concerns as soon as they arise, giving you full control over costs while giving you experienced advice on what needs to be done and what doesn’t. In boom or bust times, our service pays for itself in ensuring that your rental is trouble-free and you don’t rent to untrustworthy tenants.
With over 30 years in the industry, we’ve helped hundreds of GTA landlords make the most of their properties, in good times and bad. Give our experienced team a call today to see how we can help you manage and protect your investment.
