The allowable rent increase guideline for British Columbia now is set at 2.5% or the rate of inflation, after the provincial government rescinded the 4.5% figure announced last month.
The move came just days after the 3-member Rental Housing Task Force, authorized in April, sent a letter to Premier Horgan and Housing Minister Robinson citing an urgent need to grant relief to renters within the province.
In the letter, the Task Force recommends bringing the rent increase process to the rate of inflation, which is closer to the allowable increases in Ontario and Manitoba. British Columbia had previously calculated the rent increase figure as 2% above the rate of inflation.
Those landlords who already have provided notice of a rent increase to their tenants for 2019 must complete an updated notice form with the new rent increase figure. However, the Rental Branch advises that the 3 months’ notice requirement is not applicable to the updated notice.
Landlords likely will be allowed to apply for above-guideline increases for upkeep, however that process is still under consideration. The Residential Tenancy Branch says it will work with landlords on determining the circumstances under which they can apply for additional rent increases. (Manitoba landlords are allowed to apply for above-guideline increases to cover increased costs.)
In a statement, Premier Horgan says that the move was necessary for renters, who simply cannot afford increases above inflation each year. “We have to eliminate the risk of such huge increases for renters. Our new approach strikes a balance between giving relief to renters while encouraging people to maintain their rental properties,” he says.
It is unclear what long-term affect the move may have on rental inventory. Ontario only recently expanded its rent increase guideline to cover new rental properties, where before the caps only applied to those placed in service earlier than 1991. Because the expansion occurred recently, there is little data available on the impact of such rent control measures on overall inventory, including investment in new construction.
The Rental Housing Task Force has indicated more changes to the residential tenancy laws may be on the horizon when the members announce their final recommendations, which are expected in November.
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Disclaimer: The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.