New limit on maximum rent increases for 2020 in BC
British Columbia’s annual allowable rent increase for 2020 has been set at 2.6%, the province’s annual rate of inflation — 2% lower than it would have been prior to the reduction government made in 2019.
“Renters need secure housing they can afford,” said Selina Robinson, Minister of Municipal Affairs and Housing. “That’s why we removed the additional 2% above inflation that the old government allowed for rent increases since 2004. Under the old formula, renters would have seen a rent hike of more than 9% over 2019 and 2020. Because of our changes and the removal of the fixed-term loophole, people will no longer face the unreasonable rent hikes that were allowed for years.”
By removing the extra 2%, renters living in a $1,250 per month apartment (the average rent in B.C.) can save up to $300 next year. People in an average two-bedroom apartment in Vancouver can save up to $471 annually. These savings complement improvements to both the Shelter Aid for Elderly Renters program and Rental Assistance Program, which help low- and moderate-income seniors and families afford to rent in B.C.
In addition to these savings, the Province is also taking steps to strengthen protections for renters and limit evictions related to renovations. The Province has increased compensation for bad-faith evictions, strengthened requirements for eviction notifications and issued new Residential Tenancy Branch guidelines in July 2019 that will provide landlords and renters with stronger guidance on:
- the limited types of major repairs that truly require vacancy;
- the good-faith requirement;
- necessary permits required by landlords; and
- case law regarding renters’ ability to sustain tenancies during renovations.
“Tenant Resource and Advisory Centre (TRAC) supports the provincial government’s decision to amend the annual rent increase formula,” said Andrew Sakamoto, executive director, TRAC. “Although more can still be done to improve rental affordability in B.C., reducing rent increases by 2% is a step in the right direction. A rent increase of 2.6%, rather than 4.6%, will lead to real savings for B.C. tenants. The creation of the Compliance and Enforcement Unit has also been a positive development. It is imperative that B.C. tenants have access to a government department that can quickly intervene in serious and urgent disputes, such as an illegal lockout from a rental unit.”
The Residential Tenancy Branch’s new Compliance and Enforcement Unit is playing a key role in making sure both landlords and renters understand and follow the rules. It is also taking strong action against serious offenders.
“The new compliance unit has been investigating a number of cases involving illegal renovictions and landlords trying to evade the annual allowable rent increase,” said Scott McGregor, director, Compliance and Enforcement Unit. “We want renters to feel secure in their homes and to know their rights, and the compliance unit is ensuring that landlords understand that there will be serious consequences for deliberately not following their obligations with the tenancy laws in the province.”
When the rent increase cap was lowered in 2019, the Rental Housing Task Force also recommended that the provincial government work with landlords on revising the process for applying for limited additional rent increases to ensure they can pay for necessary maintenance and repairs to their buildings, and preserve good-quality housing for people throughout the province.
The previous process for seeking additional rent increases only gave landlords the opportunity to recover investments for unforeseen repairs or maintenance. The Province has worked with landlord groups on a new way to help ensure important capital investments are made. Landlords will be able to apply to recover costs incurred in the previous 18 months for major capital improvements. The new system is expected to be ready for summer 2020.
“The work we’ve been doing with the Province on a new process is unfolding in a manner that, in our view, will result in a process that will be fair and transparent for tenants, while providing landlords who continue to invest in the enhancement and energy efficiency of their rental properties a workable solution to recoup a portion of those costs,” said David Hutniak, chief executive officer, LandlordBC.
Affordable housing is a shared priority between government and the BC Green Party caucus and is part of the Confidence and Supply Agreement.