Define “Rental Discrimination” In Today’s Toronto Market

How about a topic like this one to start off the morning, eh?

While I’m opening myself up to criticism here, I think this is a topic that needs exploring.

Landlords want to be able to “pick” their tenants, and tenants want “fair” access to housing.

Somewhere in between there must be a happy medium, no?

TorontoSkylineCN

I’m pretty sure I’ve written a blog like this before.

Let me search my archives…

Ah, right – “Define Discrimination,” a blog from July of 2013.

The comments are always interesting, because I believe it’s very difficult to provide an opinion that’s not somehow based on an individual’s own situation.

I don’t see a real estate investor who owns seven condos coming to the defence of tenants everywhere, and rallying against discrimination of every type.

And I also don’t see low-income earners who happen to wish rents were lower, arguing that capitalism and the free market should reign supreme.

Back in January, the CBC wrote a story called, “Couple In Early 20’s Denied Toronto Condo Rental Due To Their Age”

The problem I have with this article, is that the headline (and most of the content of the article) is misleading.

It surmises that the only reason, or at the very least – the main reason, why the landlord didn’t want to rent to these tenants, aged 22 and 23, was because of their age.

But later on in the story, we learn that it was going to be occupied by two more people.

A total of four people would be renting the condo.

Isn’t the landlord within his or her right to believe, in his opinion, that four people renting a 2-bedroom condo is not as ideal as two people renting a 2-bedroom condo?

A contrarian might argue, “Four people, with four incomes, should make the landlord feel safer, since there are more people to pay the rent.”

Right, that could be true.  Or, the landlord could choose to rent to two people who have a higher income than all four, and/or who don’t “need” to share accommodations.

See what I did there – that last part?  I judged.

I made an assumption, and I judged.

I surmised that two couples – four people, who want to rent a 2-bedroom condo, somehow “need” to do so, likely because of their financial situation.

I could be right.  In fact, I probably am.  It’s a high-percentage play here, and I don’t see any viable alternate explanations, other than, perhaps, they’re swingers.

But I don’t know I’m right – that’s my point.

I’m guessing, assuming, and as a result, judging.

And the point of today’s blog, as I become completely open and honest here, is that there’s a fine line between judgment, and discrimination.

Let me draw up a hypothetical situation for you, based on experiences with both my owner-landlords, and my tenant-clients.

There’s a condo for lease for $1,600 per month in CityPlace.  It’s a 1-bed, 1-bath, 540 square feet, with a locker, and no parking space.  It has a small balcony that faces west with a clear view.

It goes up for lease, and within 36 hours, there are four offers to lease the property.

How do you, the landlord, decide who to rent to?

It’s a trap.

Because it’s not possible to decide, without judging.

And judging, is extremely close, to discriminating.

We have four offers from the following:

Candidate #1:
Name: Alexander Walker
Age: 31
Nationality: Australian, on a work permit
Occupation: Freelance tattoo artist (9 years, since he lived back home in Sydney)
Salary: Makes upwards of $150/hour (2016 T1 General showed $71,520)
Credit: No credit score available
Last place of residence: Apartment in Parkdale, 2-bed, 1-bath, paying half of $2,000/month
Reason for relocation: “Need my own place”
Notes: Has been working and living in Canada for 3 years

Candidate #2:
Name: Jennifer Kim & Michael Kane
Age: 23 and 24
Nationality: Canadian (Both from Ottawa, new to Toronto)
Occupation: She’s doing her MBA at U of T, he’s working for General Mills (4 months in, past probationary period)
Salary: she makes $0, he makes $51,000
Credit score: 708 and 825
Last place of residence: Their parents’ houses in Ottawa
Reason for relocation: “Moving to Toronto for school/work”
Notes: They have a small dog named “Toto,” and they are offering $1,650/month for the condo as they really want it

Candidate #3:
Name: Tanya Ross
Age: 26
Nationality: Canadian
Occupation: Buyer for Aldo Shoes (4 years)
Salary: $52,000
Credit score: 755
Last place of residence: 208 Queen’s Quay (1-bed, 1-bath, $1,550/month)
Reason for relocation: “Landlord selling the condo, need to vacate”
Notes: Parents are co-signing, providing 3 month’s rent up front.

Candidate #4:
Name: Anya Popov
Age: 32
Nationality: Canadian
Occupation: TD Canada Trust (eight years)
Salary: $58,500
Credit score: 688
Last place of residence: Family home in Richmond Hill
Reason for relocation: “Moving downtown”
Notes: Providing 4 month’s rent up front, and needs to rent a parking space in the building for her 2016 Mercedes C300

So those are our four candidates, folks.

Who do you rent to?

How can you possibly decide without judging these people?

So let’s look at each of these candidates, perhaps as the landlords would, and with the help of Google and other social platforms, which just about every landlord, and listing agent, would do.

Candidate #1 is a 31-year-old Aussie, who does not have a full-time job, and no guarantee of income.

He’s a freelancer, and makes an excellent living.  In fact, he makes the most money out of any of the four candidates, by a longshot.

His passport photo shows he has a massive skull tattoo on the front of his neck and throat.

He’s currently renting in Parkdale with a roommate, paying $1,000/month.

He has no credit score on file with Equifax, as he has only lived in Canada for three years.

We were not given a copy of his Canadian work permit by his agent.

He is one of those rare birds that does not have a Facebook account.

He is on LinkedIn, and has detailed every job he’s ever had since he was 14-years-old when he worked at a skateboard shop.

His GDS ratio is 26.8%.

Candidate(s) #2 are a young couple, just starting out.

She’s going to school, he has his first adult-job, paying $51,000 per year.

They previously lived with their parents, and this is the first time they’ll be living together full-time.

They have a dog, and the building is very pet-friendly.

His credit is fantastic – 825 is one of the best scores you’ll see in a given year.

Both of their Facebook profiles are public.  She has an inordinate amount of duck-lipped selfie’s as her feature photos, and he has hundreds of photos dating all the way back to high school – every event from St. Paddy’s Day, to Frosh Week at Carleton, to a folder of photos just called “SIZZURP” which contains many photos of young-20’s debauchery.

They are both on LinkedIn, with several hundred connections each, and he has five really impressive reviews from co-workers at Kellog’s, where he interned before 4th year university.

They really want the condo, and are offering $1,650/month, instead of the $1,600/month list price.

Their GDS ratio is 38.8%

Candidate #3 is a young woman who is moving out of a condominium located a stone’s throw away, because her landlord is selling the condo.

She’s four years into an entry-level job, making $52,000 per year, but her parents are co-signing the lease.

Her credit score is a reasonable 755.

Her Facebook profile is allowing us to see four profile photos – one of she and her grandfather, one of she and her dog, one of her dog wearing a silly hat, and one of the book “The Sun Also Rises,” by Ernest Hemingway.

Her LinkedIn profile has a dozen reviews from colleagues at Aldo, as well as from several summer jobs as a lifeguard at a pool and a waitress at a golf course.

She is providing 3 months’ rent up front.

Her GDS ratio is 36.9%.

Candidate #4 is a 32-year-old woman who has never lived on her own.

She currently resides with her parents.

She has worked a very stable job for eight years – the longest full-time employment of all the candidates.

Her credit score is not good – 688 is low, and results from her frequent credit card usage.

Her Instagram profile is littered with photos of her holding designer handbags, posing in front of Ferrari’s, and attending pool parties in South Beach.

She has a car, and this unit for lease does not come with parking, but she’s found a space for lease in the building for $175/month.

She also really wants the condo, and is offering $1,650/month in rent, plus four months’ rent up front.

Her GDS ratio is 37.4%.

Okay folks, I ask again: who do you rent to?

Two of the four candidates are offering ABOVE the list price.

If you’re looking for yield, you’ve found it!

But what else do you take into consideration?  Their incomes, credit scores, and occupations?  How does anybody in 2017 not delve further into their personal lives.

The first candidate has a skull tattoo on his neck.  Does that bother you?

The second candidates seem like they love to party.  Does that bother you?  Are they “immature” or are they exactly where most 22-year-olds are?

The third candidate seems like the sweetest girl in the world – she reads Hemingway, and has no ducked-lip selfie’s on her Facebook profile – just a shot of her and Grand-dad!  Awww!

The fourth candidate clearly has a wealthy family, and is putting a ton of money up front!

How in the world are we NOT judging these people?

It’s impossible to do.

You have four candidates, and with that comes employment letters, rental applications and personal details, and your nimble-fingers – which can check out Facebook, LinkedIn, Instagram, Twitter, and perform a Google search for both news and images.

Do we even know what “discrimination” is anymore?

Is it discrimination to not want to rent to a foreign citizen on a work permit, with no full-time job, who shares a 2-bedroom apartment in Parkdale, and has no credit score?

Or is that okay, but, it’s discrimination to not want to rent to him because of his neck tattoo?

What is discrimination?

The bottom line, folks, is that just about everything can be claimed as discrimination in today’s society.

It comes down to who wants to fight it, for how long, and why.

Even when it comes to something as basic as income, the Ontario Human Rights Commission has published content suggesting that “minimum incomes” or percentages should not apply.

Have a look at this: OHRC: Minimum Income Criteria

Not renting to two young 20-somethings because you looked them up on Facebook and determined that they party a lot is discrimination, no doubt about it.  It’s age discrimination, which is one of the criteria laid out in the Human Rights Code.

Take a look:

People cannot be refused an apartment, bothered by a landlord or other tenants, or otherwise treated unfairly because of their:

  • race, colour or ethnic background
  • religious beliefs or practices
  • ancestry, including people of Aboriginal descent
  • place of origin
  • citizenship, including refugee status
  • sex (including pregnancy and gender identity)
  • family status
  • marital status, including people with a same-sex partner
  • disability
  • sexual orientation
  • age, including people who are 16 or 17 years old and no longer living with their parents
  • receipt of public assistance.

People are also protected if they face discrimination because of being a friend or relative of someone identified above.

If you’re a tenant, then be aware of your rights, but be realistic in this market, or you’ll be habitually disappointed.

If you’re a landlord, be very careful of how you proceed, because the example I gave you above is very common, and it’s nearly impossible to “pick” a candidate without demonstrating some form of discrimination, under the Human Rights Code, and according to literature and opinions on the OHRC website.

And don’t shoot the messenger either.

Because if you don’t think that a landlord in Toronto today, especially after the Liberal government implemented the Ontario Fair Housing Plan, isn’t going to be more vigilant and diligent than ever before, then dare I say, you’re being naive.

If you’ve had problems finding rental housing, I encourage you to share your stories below.

30 Comments

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  1. T says:

    How about this one.

    Chinese landlords refusing to rent to non-Chinese / non-Chinese Canadians.

    I had this experience first hand. I questioned the landlords, sometimes through a realtor, and the answer was always the same. ‘We want Chinese tenants.’

    It makes me sick to my stomach.

    And no, there are no other red flags. 6 digit income, 7 digit in liquid investments, no debt, credit rating > 800. All this information was provided – and yet I was declined as the units stayed available.

    I was finally able to find a rental, but it took a few months.

    These units were all within the Harbour Square buildings.

    1. T says:

      I faced this with 4 available apartments in a row. Very disturbing.

      1. SPG says:

        Check Kijiji.. all the time I read ads that only rent to Muslims.

  2. Mr.Audi says:

    As a landlord do you actually need to provide a reason for choosing whom do you rent to from a multitude of interested parties?
    You can only pick one tenant so all the others can claim that were discriminated against.

    1. Condodweller says:

      My Google search seems to indicate that you don’t have to provide a reason to all applicants unless you reject them based on information obtained through consumer information such as credit reports. Based on this I would think telling someone that the unit is already rented should be enough although if you did pull their credit report and it was part of the screening process I think you do have to inform them.

  3. Condodweller says:

    David, this is a very relevant and useful discussion, however saying “be very careful of how you proceed” and “be aware of your rights” isn’t exactly earth shattering advice.

    Obviously selecting a tenant from a qualifying group is always going to be a subjective proposition. Whether the reson for refusal is against the law is a matter of legal opinnion. How many landlords have a lawyer on retainer to advise in each situation what the best course of action is? An interesting question is, is a landlord in fact required to provide a reason for refusing a tenant? Does a tenant have the right to demand a reason further to “I am sorry, you don’t qualify”? Because if they don’t, that’s the end of it unless you have an agent/owner who is stupid enough to provide a reason in writing which is clearly against the law. But even then how many young couples would have the financial wherewithal to pursue a case like this?

    A different question stems from candidate #3. How enforcable is it for a landlord when a parent co-signs a lease? I mean when you co-sign a loan, the bank will go after your assets until the debt is fully settled. How would an individual landlord go about collecting missed rent from a parent? Do you call them and say please pay your daughter’s rent as she missed her last payment, or can you put a lien on the parent’s home?

  4. Rachelle says:

    Well actually in Ontario, you’re not allowed to accept more than first & last, and replacement value for the condo keys, so that is irrelevant and you should know better. While we’re here discussing the law, I had a realtor accept a $500 pet deposit as well, and the tenant took the landlord to court and got it back. In reality it’s false security for the landlord and can easily end up in litigation.

    Another fun fact, all lease must contain the http://www.sjto.gov.on.ca/documents/ltb/Brochures/Information%20for%20New%20Tenants.html or there is no requirement to pay rent on the part of the tenant. This is a legal requirement for leases in Ontario.

    The new lease coming to all tenancies will be fun I’m sure.

    1. Some Guy says:

      It’s also illegal to drive 101 km/h on the 401 and 400.

      I’d love to see a landlord refuse an offer of four months rent up front.

      Good luck changing how leases in Toronto are done!

      1. Rachelle says:

        Actually I turn down offers like this all the time, because I’m a property manager I have to deal with the lawsuits that follow. If I can’t approve you using conventional methods, I don’t want to rent to you.

    2. Appraiser says:

      @ Rachelle: FYI

      “Superior Court judge Frank Marrocco agreed with Justice Barnes and explained that while a landlord could not require a tenant to pay more than first and last month’s rent as a condition of the tenancy, if the tenant offered to pay more money in advance and the landlord accepted the payment, then it would be legal.”

      https://www.thestar.com/business/personal_finance/2014/03/29/ontario_tenants_can_offer_rent_up_front.html

      1. Rachelle says:

        I’m aware of the judgement and the very narrow definition for allowing those funds to be taken as well as the interest that had to paid on the deposit. However, I also spend a bit of time at the Landlord & Tenant Board, and I’ve had the misfortune of being the landlord in the courtroom with the Vice Chair Ruth Carey. Do you want to pay a lawyer to go to Superior Court to appeal the Landlord & Tenant Board? I don’t. That is one decision, after many many years of decisions in tenant’s favour on this very issue.

        Also recently, I’ve begun what I call the “Collection Project” where I try to collect rent arrears and I’ve had a lot of success, but not enough to want to have rent arrears. Frankly if I’m collecting more than first & last I can do better with tenant quality. I do not risk my clients properties. If they don’t qualify, they don’t qualify.

  5. Tony Sbrocchi says:

    David, in respects to the CBC article you’ve quoted, I’m the Realtor that represented the tenants. There is no question that the reason they refused the lease is because of age, and those were the words right from the listing agent. Then there was backpedaling and trying to say it was income to rent ratio, again not allowed. Since this story broke the Brokerage has offered an out of court settlement to my clients which they refused as the stipulation was that the landlord be left out of it. As for your assumption of they needed all 4 to afford it, well since then the 3 sisters have gone and purchased a condo on their own instead. As I said before, if you are going to advise your client be sure you know what the actual laws are and for god sake if you are stupid enough to not play by them, don’t put it in writing as this agent did and followed it up with a flippant email telling me good luck with the Humans Rights Tribunal, it would never get there, well its there and a judgement will be made by end of week I believe.

    1. A says:

      Thanks for coming on here, Tony. Interesting case to say the least… totally agree that the landlord’s or listing agent’s response should not be in writing detailing reason for refusal.

    2. Condodweller says:

      Tony, thanks for posting here. I am curious who is the defendant in this case? Is it the agent or the owner of the condo? If it is the owner and your clients are successful in court would the owner have to sue his/her agent to recover any financial awards against him/her? It would also be interesting to know why your clients decided to sue? Were they repeatedly turned down and couldn’t find anything or perhaps they sued based on the taunting of the agent?

      I have no experience with the human rights tribunal and whether or not they can represent themselves like in small claims court or if they must hire legal representation. I suspect the latter and therefore wonder how much this is going to cost them and if it is a worthy cause to fight. I know we live in different times but in my rental days it never would have occurred to me to fight something like this. I would just move on to the next rental. I might fight it if it was a regular occurrence and there was no way to find a place to rent.

      Please let us know how the case turns out.

      1. Ralph Cramdown says:

        You can always represent yourself before any Court or tribunal under English common law. It may not always be a good idea, but no court is going to turn you away just because you haven’t hired a mouthpiece. That said, attempting to understand Ontario’s Rules of Civil Procedure is enough to make grown men weep.

        1. Condodweller says:

          Thank you Ralph. I wasn’t clear as I have watched enough movies to know that one is allowed to represent themselves, what I meant to say was can they get a fair “trial” by representing themselves hence the comparison to small claims court.

  6. Tdot says:

    Call it what you like but of course we are all going to pass judgement or discriminate. You can’t help it – you’re lying if you said you don’t.

    I just had a recent nightmare tenant living in the condo next to me. I live ground floor of condo with only three units on the outside of the building. Last August an 18 year old student moves next to me. A rich kid whose mom paid for him to live in a one bedroom condo for $1550 per month with a beautiful leather sofa and a huge flat screen tv that covered the wall. He partied EVERY night – ALL night – rap music and video games and drinking with friends. Ear plugs couldn’t even block out the noise – it actually made it worse because I could feel the vibrations in my chest. I called the police, had to couch surf at friends, called the property managers, sometimes left at 5 a.m. to sleep at my office. Property managers just said to keep calling the police if it was the middle of the night. We don’t have security full time but when they were there the kid told them to get lost and he knows his tenant’s rights … just go ahead and try to evict him. (finally evicted last month) I was going to rent my current unit out when my new condo is finished this year but after 10 months of not sleeping I’m reluctant. I will just sell it. It’s a crap shoot who you get as a tenant but I don’t care – I wouldn’t rent to someone that young. The unit next door has been empty for a month. Last night I saw a new tenant moving in. Of course I’m going to size him up on first impressions. Young guy in his mid-20’s. … and the only thing I heard him say to his buddy “oh that’s great I can put my big flat screen tv on this wall and the stereo system …here”. God help me!!!

    1. Kramer says:

      I feel for you. I always had great tenants but the people living around the unit were one of the reasons I got out of the game.

  7. Joe Q. says:

    David — given the four candidates you’ve presented us with, who would YOU pick, and why?

    1. @ Joe Q.

      The third candidate.

      It’s not about the extra $50/month.

      It’s 100% about the tenant, as the commenter “Tdot” just alluded to in his story above.

      1. BillyO says:

        Out of the 4, that was my pick too, for the same reasons.

        1. Condodweller says:

          I think stereotyping people like this can eliminate some great tenants. I would want to interview each to get a feel for their personality before making a decision. I know David has a thing against tattoos, and while I would never get a tattoo I wouldn’t reject a person because they have a tattoo especially these days when it might be a challenge to find someone under 25 without one. I know someone who had a neighbour’s kid babysit theirs whom they loved because they knew her well. She was covered in tattoos.

          I have a tenant who was young when I rented out my place many years ago but after an interview, there were no issues. This person would be an ideal tenant for anyone but based on stereotypes mentioned here he/she would have been rejected.

          I would have no problem renting to any of the four once they pass my interview process. The only one I might reject based on the information given is #2 due to the dog ifI didn’t want urine stained floors.

          1. LarryD says:

            Perhaps for some people it wouldn’t be the tattoo per se, but rather the skull design.

  8. Marina says:

    The problem with rentals is the extreme imbalance of tenant protections relative to landlord protection. If it was easier to evict, I’d be more willing to take a chance on any of the four. It would be closer to true free market conditions, which is where the human rights protections were meant to apply.
    However, once I rent to someone, I’m stuck. So I have to do maximum pre-judging to protect myself. Even then appearance can be deceiving, but at least I tried.
    Take the tattoo artist. He really could go either way – might be a crazy partier or might be into home maintenance and also scare problem neighbors. But if I take the risk and it’s the former, I’d have a hell of a time getting him out. So on to the next.
    Many friends who are on the low income rights side want rights when people are looking for a rental, but backpedal when the same people can’t pay rent or trash the place. You can’t do that and expect the landlord to not judge. If I spend my hard earned money on a condo, I will judge the living crap out of anyone who wants to live there.
    Full disclosure – I’m neither a landlord nor s tenant right now.

    1. A says:

      I was just going to post – how is it that “receipt of public assistance” cannot be grounds for discrimination?

      This goes to the financial capability of a tenant to pay and the tenant’s creditworthiness, something very fundamental in every lease. The policy of prohibiting public assistance receipt as a discrimination ground is plainly wrong.

      1. Condodweller says:

        I think someone receiving public assistance is not going to be an issue when renting a $1600/mo condo as they can’t afford it and they are also not likely to get legal advice to fight you on it.

  9. Daniel says:

    Best post in a long time!!!

  10. Ralph Cramdown says:

    This is contrived. If you’ve got four candidates, you can discriminate on just about anything you want, as long as you don’t say anything stupid. It’s when one person applies and you’re stuck either turning them down or lying that the unit is already rented that you’re at risk.

    1. Kelly says:

      I think being contrived is the point?? I rented a condo in liberty village in march and I was up against two other bidders. I didn’t pay over the list price which is just crazy. But I did have to meet the landlord first.

    2. Condodweller says:

      Agreed. I don’t know what the law states but I gotta think that if I am presented with four offers on offer night, or is it lease night for rentals, at roughly the same time, “I rented it to another person” is a good enough safe reason for refusal. It only becomes an issue if I want to turn down the only offer I have.

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