Housing Minister Rich Coleman says discussions will soon be held with a view to increasing the level by which landlords can increase rent.
This spells disaster for the people who can least afford it: low-income families, people with disabilities, seniors with fixed incomes and the province’s working poor. For many, rent in B.C. long ago ceased to be affordable, and any move to allow for increased rent beyond the current formula should be soundly rejected.
Since 2004, landlords in B.C. have had the entitlement to increase rent under the annual rental increase by a cumulative total of nearly 45 per cent on renters who have remained in the same tenancy agreement.
Stated another way, a rent that was $675 in 2004 could be increased to about $995 in 2014.
There are no rent-increase ceilings, apart from market forces, in situations where a tenant moves out of a rental and is replaced by a new tenant. Landlords who wish to raise rents above the permitted annual increase are able to do so by filing an application to the Residential Tenancy Branch, and through doing so, meet many unforeseen cost increases. Landlord claims they are unable to profit in a business with such generous growth and flexibility in consumer pricing are untenable.
The consumer price index has put the inflation rate between 2004 and 2013 at 13 per cent on all consumer goods. Landlords have had the capacity to far outpace this rate of inflation in the interest of increasing return on investment.
According to Statistics Canada, 14 per cent of the households in the Capital Regional District are spending more than 50 per cent of their income on shelter costs. Many people who have earned a living through wages this past decade are in no way closer to having the capacity to afford the current allowable rent increase, let alone higher rent as suggested could be possible by the minister’s comments.
While paying rent is increasingly challenging for the working poor, it has become impossible for many people dependent on income assistance. This is demonstrated by the increasing number of people in B.C. who are homeless or under-housed. Income-assistance rates have not increased since 2007 for employable and disabled recipients, leaving a single recipient $375 per month to meet increasing rents.
The average rental amount for a bachelor apartment in Victoria in 2013 was $695. So many citizens cannot afford rent right now; to imagine they could afford to pay more in the near future fails the math test.
Landlords have argued that increased allowable rent levels are necessary to promote the development of more rental-housing stock and to meet unexpected cost increases from property taxes and structural upgrades on their investments.
We suggest these needs can be met under the current rental increase scheme. Renters need security in their tenancy and the ability to afford basic life necessities. Surely, the proposed discussions around rental increases will do nothing to meet the needs of renters.
While it must be acknowledged that legislative changes to the Residential Tenancy Act must and should be balanced, the balance needed now is in increasing the affordability of rent through rent protections and not the increased protection of return on investment for landlords.
Encouraging the government to allow for higher rents while so many low-income renters in B.C. struggle to survive is unconscionable. Why the government would enter into discussions around raising rents instead of discussions around increasing the affordability of rent is unclear.
Landlord B.C. and other groups have pressured the government for years to increase the profitability of their industry, despite the generous allowable rent-increase provisions provided to these investors.
Sadly, renters have no funded lobby, nor the resources to effectively advocate for fairness in pricing. Quite simply, they are too busy working to pay the rent to carve out time to lobby to keep rents affordable.
In a time when B.C. is home to the highest child-poverty rate, largest gap in income distribution, and faced with an unprecedented number of people living on the streets, the focus for discussions around tenancy legislation must be about increasing affordability.
Stephen Portman is the interim executive director of the Together Against Poverty Society in Victoria.