Evictions: 5 thoughts to encourage landlords to do the right thing

On of the most distasteful parts of owning property is the eviction process.

The image many people see when they hear the word “eviction” is to think of the “slumlord” who cares about nothing but money.  I hope after reading this, you will strike this image from your mind, be able to do the work that is sometimes needed to succeed in real estate, and create opportunities for you and your family that otherwise wouldn’t exist.

 

Conflict

No one enjoys conflict. I’ve found in my extensive experience with conflict that even those who seem to enjoy it are merely engaging in a “preemptive strike” in response to tension.

I’m convinced fear of conflict is the main reason many people avoid real estate investing(sadly, because real estate investing is the fastest and most accessible way for most people t0 become financially free, but that is a topic for another time).  It’s no wonder people want to avoid dealing with evictions!

 

But Sam,  I’m going to hire a property manager to do the “dirty work” for me!

I’ve heard this before, and I believe that even if you can afford to hire a property manager, you should manage your first property yourself.

Not only will you understand your business better, but you will work on your “conflict muscle” and strengthen it in a safe and environment with a certain outcome.  Because of how our system works, if you follow the rules you are guaranteed to win!  There isn’t better practice to exercise your will than a game you are guaranteed to win, and you will need the confidence you gain to guide you through future conflicts(with contractors, negotiating with sales people, etc…).  The skill you’ll learn here will serve you for the rest of your life, so embrace the challenge!

And, even if you do not own property, developing your ability in this area will give you marketable skills of high value to others, giving you the opportunity to create another income stream and increased security for your family.

 

The Philosophy of Property rights

Private property ownership is a human right.  Most of the Criminal Code of Canada are devoted to crimes against property(theft, fraud, etc…) and it has been established that collective property rarely works in society(ie. collapse of communism in the USSR).

You don’t have to look far to appreciate this. Think of neighborhoods where there are primarily owners. You’ll likely see manicured lawns, fresh paint, etc…. because there is a “Pride in Ownership.” Now think of rough looking neighborhoods. It’s very likely the people who live there do not own the property. After all, why would they invest the considerable time and expense required to improve a place that may be temporary.  And, it’s easy for absentee landlords to ignore deferred maintenance.  After all, “out of sight out of mind.”  We landlords should ensure our properties are well cared for, but the fact is sometimes things slip(not an excuse, and you should regularly tour your properties to avoid this).

For a detailed dive into the philosophy of property rights, you’ll find a good read here.

 

Why should we enforce our rights with vigor:

  1. Tenant said they would pay rent on time, and you said you would provide safe housing.  You fulfilled your end of the bargain, it’s unfair if they don’t do theirs.  They are creating conflict by failing to live up to the contract, and it is your job to respond to this.
  2. You have property rights because you took on significant risk as an entrepreneur. Think about it: you’ve accepted the economic risk of a certain area, likely taken on a massive debt secured by all you own(personal guarantees), tax risks, risk of loss to fire/flood/vandalism. Yes, we do things to mitigate these risks, but the fact remains that an asset worth hundreds of thousands of dollars is entrusted to a tenant who provids a fraction of a percentage as security deposit, and they get to enjoy all the benefits of occupying the property for very little money and virtually no risk.  Without protection, no one would take the risk of providing rental housing, and people who couldn’t afford to purchase a place would be homeless.  The current system is win/win, and allows persons to move along the economic spectrum, constantly improving their situation.
  3. You’ve held up your end of the social bargain. It’s likely at some point in your life you were a tenant, and that you took care of the property and paid your rent on time. Now as an owner, you must hold up your end of the deal by providing accountability. In this way, our system can continue to exist, a unique blend of democratic capitalism that makes our country the best in the world. (Aside: I remember complaining to a boss that we live in a society similar to when kings ruled over peasants who worked hard for very little. He responded that there is a big difference now: work hard enough and you can become a king yourself! This never existed before, it used to be that whatever status you were born in was the same status you’d die in.  And my boss was right!)
  4. Tenants have robust rights in Canada and significant protections against abuse. Because tenants have such strong rights, landlords who do not enforce their rights can easily become abused and victimized. These turn into the tenant horror stories that discourage investment(a real tragedy for those who believe them and succumb to fear).
  5. Because we live in a country with many social security nets(paid for in part with your income and property taxes), your actions will never cause a person to become destitute(endanger their life from exposure to elements, etc…).  As such there is no moral argument against eviction. In fact, I argue that by failing to exercise your duty as a landowner to diligently enforce your property rights, you are in fact complicit in undermining the social fabric our country is built upon. Shame on you for your misplaced compassion :).

We have to deal with conflict.  Yes it’s hard. Yes it sucks.  But remember a few quotes to help you though:

“I will do today what others won’t so that tomorrow I can do what others can’t.” – Jerry Rice, Les Brown

“As you solve bigger and more complex problems, your prestige, respect and rewards will increase commensurately.” – Brian Tracy

Have a great day!

Sam Perren
– President, RENTS

P.S.
I’m just finishing a short video series on HOW to enforce your property rights in BC and I’ll post a link here when it’s done.

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