Summary of Navigating the Challenges and Opportunities for Landlords with Openroom

This podcast episode of "David and David on Real Estate" features an interview with Weiting Bollu, co-founder and CEO of Openroom, a platform that aggregates court orders related to residential tenancy disputes.  

Weiting shares her journey into property management and how a challenging experience with a difficult tenant inspired her to create Openroom, a platform designed to aggregate court orders related to landlord-tenant disputes. The conversation highlights the lack of transparency in the current rental system and the emotional toll of navigating the legal challenges faced by landlords. Weiting emphasizes the importance of due diligence in tenant vetting and how Openroom aims to empower both landlords and tenants through better access to information.

The discussion further explores the barriers landlords face when dealing with non-paying tenants and the complexities of the Landlord and Tenant Board (LTB). Weiting expresses hope that Openroom will help weed out professional tenants who exploit the system while providing tenants with the ability to research their potential landlords. Ultimately, the episode underscores the necessity for education and transparency in the rental market, aiming for a more equitable experience for both landlords and tenants.

Transcript

David Gorski: Good morning and welcome to the David and David on Real Estate podcast. Today we have a very special guest with us and I'm going to let her come on the show and introduce herself.

Weiting Bollu: Hi, David and David. My name is Weiting. I am the co-founder and CEO at Openroom.

David Gorski: Very cool. We're so glad to have you this morning. Welcome.

Weiting Bollu:Thank you very much for having me. This has been a long time coming. I remember us booking it a while back.

David Gorski: Yeah, no, we did. We booked it quite a bit of time ago. But you're one of the guests and what you're doing in the industry is so unique. We're really excited to get into it and to tell our audience about it.

Weiting Bollu: You got it. Thank you very much, everybody else, for listening in. I'd love to share more.

Weiting Bollu’s experience as a small landlord 

David Korman: Well, so maybe just start with a little bit of background and what Openroom does, but how you got into it, what's your background?

Weiting Bollu: Yeah, my background over the last decade has been in software product management. So I built software for a living in various industries like education, NLP. So natural language processing or artificial intelligence, insurance. And then I also on the side, as a side hustle for my family or extended friends family, I did property management. But what's funny is that even though I've done it for a decade or over a decade, it seems like I know I knew nothing because I went through a bad tenant experience that led me to build Openroom so I can dive into a little bit of that. Back in 2017, I had purchased a property for rental while I lived in my parents basement because I wasn't ready to move into the rental yet. I found a set of tenants, but made numerous, numerous mistakes in vetting. At the beginning, I had shared an Instagram where I talked about how much of a dumb, ignorant landlord I was in my vetting process because I was just. I didn't do a lot of the very basic things that people would do today, such as credit checks, vetting of, say, bank statements, ids. Like, I don't really know. I didn't know what I was doing, let's put it that way. However, it wasn't all that bad. And I think that some of the general consensus from the very newbie landlords or housing providers is that what's the worst that could go wrong, right? As long as my tenants pay rent, it's all good. But then came the pandemic. Things completely fell apart at that point. At the end of that year, I wanted to grow my family. So I had requested for my property back. And later that year I went through the lawful approaches, such as issuing the n twelve, which is the notice for personal use. So please leave my property. I gave the compensation, but the tenants did not want to go. And then they also decided, you know what, I'm not going to pay rent anymore either. And that took about a two year battle to get my property back. So we went to the landlord and tenant board multiple times and I got these orders, I had several of them because my tenants also filed for stays or reviews. And I remember holding these orders in my hand. I had printed them all out and I said, what do I, what am I going to do with all these? This is public information, yet it's not public anywhere. Canlii, the Canadian Legal Institute of Information, should be holding these, but they're not. I got completely ignored. And that's when I decided, I turned to my partner, my life partner, and I said, you know what, we build software for a living, right? We, we actually build software. Why don't we go do something about it? And that's the impetus of Openroom and how we first started.

Are LTB orders easily accessible?

David Korman: That is other people could access these decisions or these orders that you had. There's no system in place, so, so nobody else could. Look, they've got a similar issue. What's happened previously? Let's look up some law, let's see some previous decisions. And they couldn't access it.

Weiting Bollu: Exactly. I mean, David, you're a lawyer, so you know about CanLII and the fact that it's been used for legal professionals to do precedent case research and such, but it's not specifically related to tenancy. And in the past, the LTB or the landlord tenant board, for those listening who don't know about the LTB, they've sent cases over there, but then somewhere down the line it seems to have been delayed and therefore it's no longer there. So I don't know, there seems to be a huge backlog or some cases never land there. So I just felt like it was unjust and I wanted to do something about it.

David Gorski: Yeah, it kind of seems right. It's like a gray area where, you know, a lot of lawyers don't want to get involved with the Landlord and Tenant Board. You have to be a paralegal. And there's not the same resources that are afforded in the regular legal profession where you can go into precedents and take a look at, you know, what's really going on. And, you know, information is power right now we live in a digital age. So, you know, personally, I'm going through a situation currently where we have two tenants that are not paying rent and one of the tenants is actually in your system with a previous judgment. So I kind of feel like we failed our due diligence process and this should be an absolute step that every landlord takes and really goes the extra mile in vetting tenants. And look, life is expensive, rent is expensive, but that's no excuse not to pay your dues and not to pay rent. Exactly. I think today you can get yourself in so much trouble as a landlord if you're not getting paid rent on time.

Weiting Bollu: Yes. It pains me when I read some of the comments that are out there where tenants or renters believe that all the landlord wants is to cover their mortgage. And that's all the responsibilities that come with home ownership of being a landlord. That is beyond the truth because there's actually so much more like maintenance, human rights, the RTA, the fire inspection codes, these are all of the things that the landlord needs to know. And I think many of the newbie landlords don't know about it and they just think it's passive income. So then it gives a very bad reputation to the housing providers who want to do good, are studying, are learning about the guidelines for our jurisdiction of Ontario.

Legal representation in the LTB

David Korman: Yeah, I think you both made a good point. I just want to weigh in here from a legal perspective and the point you both address. Most lawyers don't want to go near this stuff. The landlord and tenant board, the land management tribunal, it's a nightmare. It's designed. The intention is that landlords and tenants can go there directly without legal representation. And whenever you design something like that, it becomes a bit of a kangaroo court. And although you can take legal counsel with you, there aren't too many lawyers anywhere. I don't know anybody that wants to do it or take it on. If you're a litigation lawyer, it just doesn't pay. You can't charge enough to a landlord or a tenant to make it worth their while to retain you. So paralegals get retained. And I'm referring this type of thing out to paralegals too. And some of them are good and some of them aren't good, but at least there's some representation. But they need access to prior decisions. They gotta. They're the ones that are in the trenches there and everything. But it's a kangaroo court. Like, the decisions are bizarre and it's clearly slanted towards a tenant. So like your example, you know, just a defaulting, non paying tenant and you can't get rid of them, right? Forget about, you want it for your personal use, you should be allowed to get it for your personal use, too. But just they're not paying rent and you still can't kick them out.

The emotional cost of getting your house back

Weiting Bollu: Well, David, how I see it is that I knew the day would come when they would get evicted, but it just took so long, and it really played a detrimental effect to my mental health, because what I didn't mention earlier was that I was pregnant, and I had gone through from the time of when I first requested my tenants to move out, because I just wanted to grow my family. I wanted to do it. I actually had gone through an ectopic pregnancy. So what an ectopic pregnancy is, it's a miscarriage. And that's where the egg didn't land, in the right place, in the actual place where it should grow, but it landed in the fallopian tube. And had that erupted, then, that could have been the end of my life. But we caught it early. So I had gone through ups and downs during the entire initial battle for the big battle with my tenants. I didn't share all of that with them. It was just like folks, I really, really would like my property back. And, yeah, it was painful. It wasn't just a financial issue, which I think many people who are going through it. David, as you're going through it, it's not just financial at the end, like losing $35,000. For me at the beginning, yeah, it hurt, but it was more of a mental toll that it took on my body and the legal, financial, I was like, what is this? I didn't know that the LTB was even a thing when I first started.

David Gorski: Yeah. And what I love about this system is that these professional tenants that arose out of COVID as of the whole grayscale that exists, with these cases not being transferred to Canlii, over time, they're going to be weeded out of the system, because as information spreads and as news spreads about your service and as landlords incorporate a standard practice of really vetting their tenants, the first time that the tenants get added to your system, and I've gone into your system, I've seen some of the notes, I've seen some of the comments. I've seen tenants messages say, oh, my God, I didn't know that this existed. Had I known, I wouldn't have behaved the way I behaved. And I'm like, well, that shows us that it's working. That it's working. You know, they're only getting one strike, and when they get that one strike, you know, they're going to get on the list, and when they get on the list, it's going to be extremely hard for them to find accommodation. So I think over time your system is going to work as a deterrent and it's going to keep tenants honest and really encourage them to do the right things, to behave in a certain way and to pay the rent, which is what we want.

How Openroom helps tenants

Weiting Bollu: Yes, a couple comments on that is, yes, we have started to see behavior changes in the rental ecosystem, which is what we haven't seen in the past. The whole idea is that it's not just for landlords to use Openroom as a research purposes for their rental decisions, but also from a tenant perspective. Tenants should be able to go inside the system, research who they're going to be renting from, are they going to be requesting maintenance and then never hearing back? Because you can see if those previous housing providers or land landlords have gone to court or been taken to court by previous sets of tenants. And then the other side is the majority of tenants are actually fantastic. But if we can start holding people accountable for their actions, then it's going to provide more opportunities for the fantastic responsible, rent paying tenants that are out there in the world.

How content gets into Openroom

David Korman: Maybe just take a couple minutes to just explain where the content comes from and how it gets into Openroom, into your platform.

Weiting Bollu: Yeah, how content gets into Openroom. There are multiple ways of doing it, but everything is factual, so I want to point that out. We never ever post anything without factual documentation behind the system. Right? So a couple of ways is a majority of folks submit documents to us. So it could be the landlord, the tenant, a legal representative, or someone who just obtained it from the public somewhere. Maybe someone had posted it inside a Facebook group and then they retrieved it and then posted inside our system. The other side is our team, as well as very avid supporters of Openroom, actually go and do what's called the freedom of information request from the tribunals. And what that means is that if you, for example, listen in on a hearing, or you just know that there was a case that was happening with the names, the address, you can actually fill out a form called the freedom of information request and submit it into the tribunals, and then they will send back the documents within like three, four weeks or so. So those are the main ways that we gather the information. And once the information is actually inside the system, the document, we do a rigorous check behind the scenes to make sure that it's not a fraudulent document. And as soon as a document that was uploaded by crowdsourced method. So that means someone uploaded it, then that means that if there was a dispute, we would always go then through the freedom of information request to go get the original documentation. Does that help, David?

David Korman: Yeah. So anybody that has a case can go to the site and upload it?

Weiting Bollu: Yes.

David Korman: But then you'll go through a vetting process at your end to verify it.

Weiting Bollu: That's right.

David Korman: Actual decision?

Weiting Bollu: Yes, yes.

Openroom and a transparent rental ecosystem

David Gorski: Yeah, I love this. I think the more the system operates, the more it's going to act as a deterrent, and we've never had that before. All these cases used to be behind closed doors, and even though the actual notices were public information, they weren't posted anywhere, so nobody had access to them. It was, it was sort of an open but restricted system operating in the gray. So, you know, I think bringing this forward to everybody and having open information, having it work two ways where, you know, the tenants are getting something out of the system too. They can vet landlords, they can understand who the good landlords are. I think it keeps everybody honest and accountable. And, you know, for the first time, I think this is a major breakthrough in the landlord and tenant board and Florida landlords. And, you know, we're talking about so many people right now wanting to get out of the landlord space because the law is so one sided, because it takes so long to evict a tenant, because, you know, of these professional landlords that we're seeing in the landscape. And I think this is the first step. This is, this is the only thing I'm seeing. And David Corbyn, maybe you can comment here, but nothing else is really moving the needle and making a big impact to really alleviate some of those issues.

David Korman: Yeah. And we're, you know, we all like people to buy properties and invest in properties, and then you have to have tenants to make it worthwhile. And the systems slanted a little bit against the owners, the landlords, and it's difficult. So you have to, if so, investments, in a perfect world, you get a great tenant in there, they pay you rent, it covers your mortgage, covers your maintenance, covers whatever it's going to cover. You make some money at the end, you get appreciated value on the property. That's the goal. Right. But it doesn't always work like that because not all tenants are created equally. Not all landlords are good landlords either, and on top of the maintenance. But the system to support what your legal rights are is this landlord tenant tribunal. And the decisions are bizarre. And it's not just like you said, ultimately you're going to get your money, but why should it take six months, two years to get your money? The process doesn't work well and a lot of people can't wait it out. And it's aggravating and all the stress it creates, so it's hard. So anything like this that can help the system along when you can show the tenant, hey, tenant, if we go to true, you're going to lose. Here's examples of why you're going to lose. This has been adjudicated before and you got no chance. So that should give them some incentive to, you know, to react appropriately. Right. So it gives, it puts a full. 

David Gorski: few bullets in the landlord's gun, so to speak, a little more ammunition. And it goes the other way too. I assume if it's a tenant with a dispute, the landlord, they can look up and see what a landlord's obligations are and how the tribunal is going to react to these things so they know what their likelihood of success is too. Right. So I think this is fabulous because it's only going to help both sides.

Future goal: Incentivizing repayment of debts with Openroom

Weiting Bollu: Yeah, thanks, David. Actually, comment on that is from a money perspective, I've actually received $0 back. I've seen zero, zero from my tenants so far. So it's not that I knew that I would get money back, it's that I knew I would get my house back, which then, I guess, translates into money. But I did not think that I would get money back. And that is the general consensus out in the market today, where if you have a tenant who is a non paying tenant, it's the likelihood of getting money is likely. It's about one to one out of five. When I was speaking with collections agencies that may potentially work with Openroom in the future. All right, and that's sad. But what if Openroom can create a future wherever we can actually entice people to pay back? Because, as both of you said, more people get to know about Openroom and then it actually creates harder opportunities to find housing. If you are listed as a tenant who doesn't pay rent, what if there are opportunities for you to pay? That is something that we're looking into and one of the main challenges. Yes.

David Gorski: Yeah, that's brilliant. And as you get all these orders in wherever, you know, you see an order for $20,000 of outstanding rent, maybe what you do is you credit the landlord, the tenant back and say, hey, you know what? This is a zero out of ten. But because the landlord, sorry, the tenant made restitutions and pay back the money owing. We're going to give him an eight out of ten rating. And you're going to start moving towards a system where you start rating tenants on the fact of, you know, what's the overall relationship? Not just the relationship when the tenancy ended, but did those future obligations get met? And especially when you throw at a statistic like one in five, that's shocking to me. Even speaking to collection agency, I mean, that's pretty far along in the process. But if a tenant has no assets and if there's no guarantor on the lease, then it's really hard to collect. And I mean, you can collect against future earnings. You can do a lot of things, but a lot of those systems are inefficient or not perfect. And if you say that four and five, you cannot collect, then this is, this is. I love where you guys are going with it.

Weiting Bollu: Yes, yes. I mean, part of the reason why I can't collect is that my tenants earned a cash business and they primarily, at least primarily cash business, and they own the company themselves. So it is very difficult. I'm sure that there are other intricacies that they've played the system in many ways, but for me to continue to throw good money at bad money, it, it's painful. So I'd rather put all that energy, that anger, that passion, motivation into building Openroom so that I could prevent other people from experiencing it almost as a preventative approach, than me continuing to react to what they have caused in my life.

David Gorski: Love it.

David Korman: Yeah, I think we're going to have to continue this. We're out of time for this, this part, but we need you back. We got, we got more.

Weiting Bollu: Sounds good.

David Gorski: And, you know, I love the fact that you're taking on a real problem. And I mean, this is such a big problem. Like I, you know, owning a brokerage, being in the real estate industry for 17 years, really being put some boots on the ground. We hear this five times a day, every day. And really there isn't a solution out there that, you know, it's so simple and I think it's going to have such lasting effects on the industry. Like I'm, you know, when I heard what you guys are doing and your growth speaks for it, we're going to have you back because, you know, we want to talk about all this, but, you know, your growth speaks for it because you guys have been exploding over the last couple of months and people are really taking notice and you guys are making a big difference, which is unbelievable.

How to use Openroom

Weiting Bollu: Thank you. The last thing that I want your listeners to take away is how do you actually use Openroom? Before we end the episode, you go to Openroom Ca, and then you can make a search for name, address or other parameters. And then what will pop out are results or records. And then you click into the record, you can see the actual court or tribunal documentation and you can decipher from there information on what happened in the dispute.

David Korman: So we're just talking about that part of it. Is there a cost to anybody using it right now?

Weiting Bollu: No, it is free. So that's why we exist at the beginning of your workflow. If you are considering to rent out or rent from somebody is you search names, addresses and other parameters and then decide whether you want to pursue other costly factors such as background checks or rent reporting features.

David Gorski: Amazing. Awesome. Well, we're going to have you back in the next episode. Thank you so much for joining in and join us next time on the David and David on real estate podcast. Thank you, everybody.

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