Could bigger rent increases help ease housing crisis? Union of B.C. Municipalities thinks so
UBCM proposal to allow landlords to raise rent more than 4% raises concern from tenants union
The Union of B.C. Municipalities has put forward 32 recommendations that aim to ease the province's housing crisis — including a proposal to increase how much landlords can raise the rent.
It's a move that's drawing criticism from at least one group that represents Vancouver renters.
Currently, landlords in B.C. can only increase their tenants' rent once a year by a percentage set by the province. In 2018, that amount was four per cent.
But the UBCM says constricting rent increases too much can keep landlords from making significant improvements to their properties — especially for older rental stock that needs major repairs.
"We did hear loud and clear that the small amount that rents can go up won't even cover the costs of maintaining the building," said Greg Moore, chair of the UBCM's housing committee and mayor of Port Coquitlam.
"They need a substantial improvement to keep up to today's standards."
Moore pointed out that older, purpose-built rental buildings are often the most affordable homes, so it makes sense to keep them on the market for as long as possible.
'No one quick fix'
The recommendations were spotty on the specifics of how the rent increase would work.
Moore explained that it was enough of a challenge for committee to put together the 32 recommendations since it was convened six months ago, prompted by a province-wide housing crisis.
"There's no one quick fix to this situation that we're in," he said, emphasizing the need for cooperation from the provincial and federal governments.
The committee's other recommendations for rental properties include a tax credit for new purpose-built rental housing, creating zoning for affordable rental housing to avoid speculation, and supporting the development of new co-operative housing.
The recommendations also included strategies on how to limit demand and speculative home purchases.
'We want to invest in our buildings'
David Hutniak, the CEO of Landlord B.C., agreed that an increase on raising the rent would be helpful for landlords.
"We want to invest in our buildings," Hutniak said.
"Right now, generally, there's just not a whole lot of incentive for many landlords to make those significant investments in their properties because they have no way of recouping them."
Hutniak said there are some allowances for more substantial rent increases available through the Residential Tenancy Act, but they require landlords to go through an arbitrator.
"All the gyrations you need to go through to seek an above-level increase, it's just not worth it," he said.
'Struggling to make the rent'
But Derrick O'Keefe of the Vancouver Tenants Union said the idea of raising the maximum allowable rent increase was problematic.
"Renters, especially middle and low income, are struggling to make the rent," O'Keefe said.
He pointed out that a four-per-cent increase on an average-priced two-bedroom home in Metro Vancouver, last calculated at $1,552 per month, would cost a tenant $745 per year.
O'Keefe added that rents in some neighbourhoods in Vancouver have more than doubled because landlords can increase rent by as much as they'd like between tenants — whether they make any improvements or not.
That's why the Vancouver Tenants Union is advocating for the province to tie maximum allowable rent increases to housing units instead of to renters.
One strategy the union and the UBCM do agree on, however, was involvement from other levels of government.
"We'd like to see the federal and provincial government permanently in the business of building and maintaining the housing stock," he said.
Moore said the UBCM hopes to work closely with both in the coming months.