‘Jacking’ Tenants at 4.5% – An Idiot’s Guide to Rent Increases

The list of a landlord’s financial responsibilities is long and usually costly.

The NDP Government is allowing for a rent rate increase of 4.5 per cent in 2019, compared to the maximum 4.0 per cent previously allowed under Landlord and Tenant Act regulations.

In a recent CBC News online article by Alex Migdal on September 8, 2018 titled B.C. renters set to face biggest rent increase since 2004, he writes “B.C. landlords will be allowed to jack up rents by as much as 4.5 per cent in 2019 — the biggest increase since 2004, when it was capped at 4.6 per cent.”

I would like to point out that Mr. Migdal’s information is incorrect on many points and I am very opposed to the phrase “jacking up rents” as it implies that landlords are not entitled to increase revenue for a very expensive service that is provided, often at a cost instead of a profit.

For an alternate perspective, below is the Maximum Allowable Increase as listed on the provincial government website.

“Landlords can only increase the rent once in a 12 month period by an amount permitted by law or an additional amount approved in advance by an arbitrator – they need to use the right form and give the tenant three full months’ notice of the rent increase.”

I’ve added a table of rent increase percentages since 2010 which clearly shows a steady and necessary yearly increase. In fact, there was a significant adjustment in lower percentage rent increases after 2013.

Clearly, no one is getting “jacked”.

The bigger question that needs to be asked is ‘who is responsible to make sure that housing stays affordable’? Is it up to the taxpaying homeowner/business owner, or government programs that limit funding?

The provincial and federal governments keep processing more and more people onto social funding programs at ludicrously low allowances for monthly rent amounts. This creates communities where a family’s income cannot support adequate housing.

The question is therefore about who is responsible to make sure this family has a home they can afford under the government’s allowable rent rate per month.

While there are a lot of bad landlords out there, there are ten times as many good ones.

A landlord (the person who pays the mortgage as opposed to the employee that collects the rent and unblocks kitchen sinks) shoulders the cost of the regular mortgage interest rate increases, the cost of repairs and maintenance to the property, which sometimes includes lawn care and snow removal, pays city or local taxes, pays taxes on the rent they collect per month, pays utilities, pays for replacement appliances and furnaces in addition to paying to advertise the unit for rent. The list of a landlord’s financial responsibilities is long and usually costly.

In B.C. the security deposit or damage deposit on a unit is equal to one-half of the total month’s rent. On a three-bedroom bungalow style house with yard and garage at $1,200 rent (where the writer lives) the deposit would be $600.

If a tenant leaves the unit without notice, the landlord is out rent for the following month. If a tenant leaves a mess to clean up and garbage to remove, the landlord pays for that.

If the tenant doesn’t pay the utility bills and leaves the unit, the landlord is responsible to pay that utility bill. The costs add up quickly and will often time exceed the deposit amount. The landlord has no choice but to pay for the repairs and cleaning in order to be able to rent the house out again.

The first thing that has to change is the Landlord & Tenant Act itself. The laws are increasingly tilting towards protecting tenants instead of the people who pay taxes to provide the housing.

Landlords need to pay attention to the changes that are being made on their behalf, without their input on any level about any issue relating to policy changes.

If the provincial and federal governments won’t increase the monthly amount allowable for housing, then they should start building community housing centres and take care of the mess they created. Why should the private citizens’ and business owners shoulder the responsibility of providing “affordable housing”?

A rental property is a business, just like a convenience store. Price of milk too high? There is another store right up the street. Prefer to pay a little more for a quiet, out of the way neighbourhood? No problem – there will be a higher priced rental to suit one’s needs.

No one is telling the convenience stores to stop increasing the price of pop, so why should homeowners accept withholding rent prices and decreasing rent amounts to suit what the lower income public can afford?

Yet tenants never ask the convenience store to let them leave with their snacks and drinks and expect to pay on the next payday. Landlords go without rent payments on time, all the time. There is more respect for the person that rings up potato chips than there is for the person putting a roof over a head.

In an effort to be solution-driven and not only problem focused my suggestion would be to have tenants and landlords stop treating each other like enemies and start learning how to work together. There are many ways to make the landlord and tenant relationship worthwhile and affordable on both sides.

Instead of focusing on an increase of 4.5 per cent next year, which landlords desperately need and most tenants can’t afford, let’s start a discussion to figure out a way to make the federal and provincial governments accountable for increasing funding for basic needs.

Here is a suggestion that might stick – the government(s) should pay the homeowners the 4.5 per cent directly at the end of 2018, with an increase to 6.5 per cent yearly for 10 years; kind of like a cash back system. The tenants are already paying more than they can afford.

This issue will be followed up regularly and will feature ways to get involved, be productive in the community, effectively communicate and resolve tenancy issues without resorting to drawn-out battles.

There has to be a better way. Housing should never be something to worry about. We live in a country with plenty of space, resources and options. Let’s start discussing how to use these resources to create communities where every person and family has an affordable home.

No person left behind. No child left unsheltered. Sounds easy, doesn’t it?

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