David Hutniak, CEO of Landlord BC
VICTORIA – The NDP government has capped the allowable rent increase in the province below the rate of inflation for the second straight year.
The maximum increase for 2024 will be 3.5 percent, well below the 12-month average inflation rate of 5.6 percent. In order to increase rents, which they can only do once every 12 months, landlords must provide three months’ notice to tenants and utilize the correct Notice of Rent Increase form.
While the move supports renters, such limitations have proven to crimp investments in new rental housing, since property owners see diminishing returns that can’t match inflation and dim the prospects for future projects, making them higher risk with lower returns.
Prior to 2018, the annual allowable rent increase was based on the inflation rate plus 2%. Following a recommendation by the Rental Housing Task Force, the rent increase was reduced to just the inflation rate. In 2020-2021, a rent increase freeze was put in place to support renters during the COVID-19 pandemic, and to protect renters from high inflation in 2023, the NDP government capped rent increases at 2%, well below the 5.4% inflation rate that would have otherwise applied.
If a landlord served a tenant with a Notice of Rent Increase that takes effect in 2023 using the 2024 annual allowable rent increase, it is null and void and the tenant does not have to pay it. They must follow the set rent increase for 2023.
The rent increase does not apply to commercial tenancies, non-profit housing tenancies where rent is geared to income, co-operative housing and some assisted-living facilities.
David Hutniak, CEO of Landlord BC, which represents about 3,300 property owners in the province, told the Vancouver Province “We are not immune to inflation. Just trying to maintain the buildings and provide the housing that we do, we’ve seen core operating expenses – insurance, utilities, taxes – gone through the roof.”
He added that landlords have been hampered by zero or below-inflation increases since 2020.
“The issue is, on a cumulative basis, our landlords just keep falling further and further behind,” Hutniak told the Province. “In talking to our members, there’s so many of them that are in a negative cash-flow situation year-after-year. That’s just not sustainable for any business.”
By Mark MacDonald
