Hold onto your hats. It’s going to be a long, cold winter for a lot of renters. In our office, we have a higher volume of payment defaults than ever before–and it’s mid-December! Usually, January and February are the months when most of our tenants have payment issues. They load their credit cards during the holidays and then have a hard time making rent early in the year. If we’re seeing defaults BEFORE the holidays, my bet is that the rising cost of living is hurting a lot of people’s pockets.
My advice: prepare to negotiate payment plans with your vulnerable tenants or else prepare for a hairy season at the rental board. Rents are marching upwards and vacancy rates remain low in many markets, so I don’t expect that renting units will be very difficult. It will be more a question of managing turn-over, or picking and choosing which tenants you want to help through a rough patch.