If the Next BC Government Cares About Renters, Here’s What It Will Do

Both the Greens and NDP made a lot of ambitious housing promises in the election campaign. So what will change on the ground if you are a renter, presuming the expected minority government lasts?

For starters, the Greens promised to build 4,000 new affordable units a year and invest $100 million annually to retrofit aging homes for energy efficiency. The New Democrats went farther, promising 11,400 new affordable units each year (including rental, co-op and owned) over a decade.

NDP leader John Horgan also promised a $400 annual subsidy for all renter households.

But there is a lot more that can be done in the short term. As the keepers of the Residential Tenancy Act — the legislation created to protect the rights of both tenants and landlords — the provincial government has the ability to ensure that renters are protected in the current tight market.

What follows are four priority actions the next B.C. government could take, gleaned from pre-election interviews with housing experts — including two re-elected Vancouver NDP MLAs.

All of the fixes could be made relatively quickly.

1) Close the loophole that allows bad landlords to jack up rents

On the eve of the 2017 election, the NDP and Greens pledged to close the fixed-term contract loophole that currently lets bad landlords increase rents above the annual limit prescribed by law. It’s a loophole that could be closed with the stroke of a pen — but it was a fix the BC Liberals never got done.

It typically works like this: a new renter is asked to sign a lease for a fixed term —often a single year — with a box checked off that obligates the tenant to vacate at the end of the year.

If the tenant wants to stay at the end of the year, they have to sign a new lease. By forcing the tenant to sign a new contract, the landlord can get around the limits that would apply if the tenant was just renting month to month and impose a much higher increase. (By law, a landlord can only increase the rent by two per cent plus inflation each year — 3.7 per cent this year — unless they apply and cite special circumstances that justify a bigger increase.)

When presented with such fixed-term agreements, many tenants either do not realize they are signing their own eviction notices, or wrongfully presume they will continue to pay month-to-month after the year is up.

Interviewed before the election, Vancouver-Point Grey MLA and housing critic David Eby said this loophole was “spreading like cancer” across Greater Vancouver – citing this news story about Aquilini Development’s new West Tower rental project near Rogers Arena. He said the loophole needed to be closed.

All of this came after months of B.C. government foot-dragging. Back in the fall, a spokesperson for the Ministry of Natural Gas Development and Minister Responsible for Housing told the Tyee that it was “looking at options to ensure fixed-term tenancies are not used as way of bypassing rent control legislation.”

Pressed on the timelines for changes at the time, the spokesperson stated “it’s too early to speculate when the changes will be coming in.”

With the NDP and Greens both promising to close this loophole, how soon will the problem be addressed?

2) Aggressively and proactively enforce existing laws

The eviction of almost 150 poor tenants from the Downtown Eastside’s Balmoral Hotel, owned by the infamous Sahota family, is shining a new light on what a more activist provincial government could do to help vulnerable renters.

In the Residential Tenancy Act, there’s a provision that allows “administrative penalties” against landlords (and deadbeat tenants too). In a conversation with NDP Vancouver-West End MLA Spencer Chandra Herbert last October, he favoured a more aggressive approach.

“If a landlord has been found to be breaking the law, maybe it’s harassment, maybe it’s renoviction, maybe illegal rent hikes, then throw the book at them,” he said. “Give them a big fine, so it’s no longer seen to be profitable. Because right now it’s profitable to break the law, even if you get caught.”

Enforcement isn’t just lax, it’s almost non-existent, said Herbert. There are only two cases he could cite where landlords have been fined in B.C. history, one being $115,000 levied in 2012 against landlord Gurdyal Singh Sahota, one of the Balmoral owners. In that case, the province agreed to waive the fine if Sahota fixed the building, addressing the Surrey tenants’ complaints of mould and structural damage, and made amends with the renter.

“It's like catching a bank robber and letting him go because he agrees to give the money back,” said Herbert.

David Hutniak, CEO of LandlordBC, says the fix is not as easy as it appears. “Administrative penalties are an interesting concept, but the issue is ability to pay more than enforcement,” he says. “The market is disproportionately represented by small landlords... many of them operating secondary suites. I question whether the Residential Tenancy Branch [the body that addresses landlord-tenant disputes in BC] would have the capacity to manage this.”

3) Increase funding to the Residential Tenancy Branch

Further to Hutniak’s point, addressing the capacity of the Residential Tenancy Branch is a priority. The organization currently operates a single office for 2.3 million renters across the Lower Mainland. It also keeps the same office hours as most low-wage earners, which means that attending in-person meetings is often impossible.

Andrew Sakamoto, executive director of B.C.’s Tenant Resource and Advisory Centre (TRAC), says the branch is “under capacity in all aspects.” He says a renter who has been wrongly evicted and calls with complaint can be put on hold for upwards of an hour. If you apply for a hearing to enforce a monetary order — for instance, when a landlord won’t refund your security deposit — you can wait up to seven months.

Last year’s provincial budget included new money for arbitrators at the branch, but a TRAC spokesperson confirmed this week that more resources are still badly needed.

4) Review the annual allowable rent increase

The law in B.C. lets landlords raise annual rents by two percent plus inflation. The problem is that most renters are not seeing a similar increase in their incomes.

For example, Sakamoto says that if you started your tenancy in 2008 paying $1,000 a month and the landlord raised the rent by the allowable amount each year, then your rent would be $1,324.90 — an increase of about one-third. Average weekly earnings in B.C. have increased by about 18 per cent in the same period.

British Columbia’s new government could look to Ontario, which has capped annual rent increases at the inflation rate, using a Statistics Canada tool measuring economic conditions and inflation. This approach was initially applied to rental housing built before 1991, and in April expended to all rentals.

The 2017 allowable rent increase in Ontario is 1.7 per cent. But in B.C., landlords can raise rents more than twice as much at 3.7 per cent.