I can’t believe it is May 1 already.  

If there was no lockdown, today would have been the day that I could finally relax from the busy tax season. 

Instead, we’re still “stuck” at home, following all the latest and greatest programs released by the government. 

Today is also the student rental turnover day for many student rental landlords. 

I have a few student rentals in my portfolio and it can get chaotic.  I’m grateful for my team, including existing tenants as well as my property managers who help with coordination. 

Today is also the day we’re expecting to see Canada Emergency Student Benefit receive Royal Assent. 

Under this program, 

  • Post-secondary students (and those who got accepted to start post-secondary education coming September and recent grads from post-secondary schools leading a degree, diploma or certificate after December 2019)  can qualify for up to $1,250 a month from May through August. 
  • Students must demonstrate that they are looking for work. 
  • Students can get as much as $1,750 with dependents and those with permanent disabilities. 
  • Students who volunteer over the summer will be paid between $1,000 and $5,000 depending on the hours they work. 
  • Students can collect $1,250 and the volunteer benefits and hold a job that pays less than $1,000 a month.
  • Student grants for eligible students are doubled up to $6K for FT students and up to $3.6K for PT students
  • Raising maximum weekly amount that can be provided through the Canada student loans program 
  • Students can simply apply through myCRA account, application is open sometime in May. 

For commercial landlords, the government also came out with a new program called Canada Emergency Commercial Rent Assistance program.  It is a program administered by Canada Mortgage and Housing Company

This program basically requires landlords to give up collecting 25% of the rent, tenants would pay 25% and the program gives the landlord 50% toward the expenses (primarily mortgage).  

Landlord qualifying criteria:

  • You need to have a mortgage loan secured against the property (if you don’t have a mortgage, alternative mechanism will be implemented)
  • Must sign a rent reduction agreement to lower your rent to small business tenant by at least 75%
  • Reduction agreement must include a moratorium on eviction for the period of April, May and July 
  • You have to declare income on your return in 2018/2019

Small business tenants:

  • Pay less than $50K gross rent on a monthly basis
  • Earn less than $20M in gross sales
  • Has temporarily ceased operation or has experienced at least 70% decline in pre-COVID 19 revenues 
  • As per Ontario government’s website, the small business has to be a non-essential service as well.  If it is an essential service, you’re automatically ruled out. 

Mixed review was received by the business community on this program.  The application will not be open until mid-May. 

You can sign up at CMHC website for the latest update. 

Earlier today, I had an opportunity to share some of these programs with fellow real estate investors.  Here’s a quick recording of it. 

Hopefully it helps some of you out. 

Until next time, happy Canadian Real Estate Investing.

Cherry Chan, CPA, CA

Your Real Estate Accountant

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