An Ontario family is out $1,800 after they arrived at what was supposed to be their new Vancouver Island home and discovered that it was littered with rat feces, bedbugs and even a syringe.

Penny Sandirfer and her husband saw their new Nanaimo rental home for the first time Monday after renting it through a realtor they connected with on Craigslist. They say they knew it was a fixer-upper, but didn't expect it to be uninhabitable.

"It never said anything about mould or that it had pests or bedbugs, or that there's urine and feces in the house, and so we didn't know. And of course we never knew that it had been occupied by drug users and prostitutes," Sandirfer said.

She said the couple had agreed by email that they would do some clean-up and renovation in exchange for reduced rent. A relative in Nanaimo offered to take a look at the property, but they could only see the outside of the home because there were people living inside.

"We called the city to make sure he owned the house, they said he owned the house, then we did a little bit of investigation on the man and found out he's a realtor. And we're thinking to ourselves, he's a realtor, come on, he's selling houses to people every day --surely he's not going to put us in a home that is trashy," Sandirfer said.

The family put down $1,200 for the first month's rent and another $600 as damage deposit, but the City of Nanaimo has now stepped in and declared the house at 787 Albert Street unfit for tenancy.

That means the Sandirfers and their four children don't have anywhere to live, or any money to get back home to Ontario.

"I just want to get my dogs and my kids and get a house," Sandirfer said.

Landlord Michael Lipnitsky acknowledges that his previous tenants did some damage to the house.

"I had five tenants who were on social assistance, and mentally challenged people do not clean up after themselves," he said.

But he insists he had a clear agreement with the Sandirfers, and is refusing to refund their money.

"I said I could do renovations and I offered it to them by email, and they said, ‘No, we'll do everything by ourselves," Lipnitsky said.

"I'm refusing to be punished for these people having their relatives inspecting the place and promising to rent it from me two months ago."

It's not clear how long Lipnitsky has to bring the house back up to code, but neighbours say they're pleased the city has intervened.