How to get market rents when inheriting below market rent tenants

[Solome Ejigu]

Hi all,

I’ve found a good deal but the current tenants are paying wayyyy below market rent. About $600/mon with heat included. the deal for that type of 4 Plex and location is great but the current tenant leases make it tricky. If I could Reno and rent at market rent, it would be amazing but my question is other than cash for keys what are some other ways to consider when trying to clear out units. With the halifax tenancy act and the 2% rent cap there is barely any wiggle room. Anyone have creative ways around this?

TIA!

[Aaron W.]

@Solome Ejigu The the rent caps you are facing, this makes things difficult. Are any of the units vacant or can become vacant soon? One method is to not renew the lease of a tenant then once they move out, you renovate that unit. You can do this one-by-one until all the units are renovated. This takes time, however.

Another method is once a renovated unit is done, you move a current tenant into a renovated unit, then renovate the newly vacated unit. This can speed up the renovations so you can get up to market rents, but you also need to have willing tenants. You may need to provide some sort of an incentive to make the move.

Best of luck!