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Monday, July 22, 2024

‘Cash for keys’ offers on the rise in Toronto, real estate professionals say

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In Toronto, the practice of landlords offering cash to tenants to vacate their units, known as “cash for keys,” has been on the rise, according to real estate professionals. This practice is becoming more prevalent due to financial pressures faced by landlords, such as higher interest rates. 

While still relatively uncommon, instances of cash-for-keys offers are increasing, with real estate investors looking to sell their properties being the primary source. 

The offers often occur in rent-controlled condos where tenants’ monthly rent payments may not cover investors’ cash-flow expectations. The amounts offered in cash-for-keys deals vary, with reports ranging from $10,000 to $30,000 or even a year’s worth of rent, depending on the situation and rent paid. The delays in Ontario’s tribunal handling landlord-tenant disputes may contribute to the increase in such offers. 

Tenant rights in these situations are protected by Ontario law, allowing them to stay in the unit at the same rent unless there are specific circumstances, such as default, an agreement with the landlord, or the landlord’s need to move in or perform extensive renovations.

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