Maintain the status quo with respect to rent increase in the province of B.C
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To Whom It May Concern:
I write on behalf of a group of concerned landlords who wish the government to reconsider the cutting of the 2% automatic rent increase. While we understand that the current 4.5% increase per annum (after adjusting for inflation) is at its highest in recent years, we assert that this number is still dwarfed by the associated costs in maintaining a rental unit.
To quote from a fellow concerned landlord:
"My rental unit will be due for mortgage renewal this year. The increase in interest rate of more than 50% triggered by a shift in fiscal policy imposes increasing significant financial burden to maintaining my property. On top of that, my property tax has increased by an additional 15% relative to the previous year. Due to the flooding and wild fires which ravaged through the province, my insurance company demands a 22% premium over the previous year to reflect the additional risks. Our condo strata fee will also increase by 5% as set out in the agreement. Taking all these factors into account the current allowable increase is just barely enough to cover the additional expenses, let alone further cuts to that rate.”
BC Landlords are actively trying to solve the current housing crisis through economically viable means. The government should consider both sides of the issue before implementing a policy that could adversely affect an important contributing member of the economy. Any policy introduced should be sustainable in the long term, and we as landlords simply fail to see the sustainability in such a harsh rent control measure. The status quo at least ensures that there will not be a decrease in housing supply as those in the market can still manage to squeeze by despite the ever-increasing costs associated.
We are afraid that upon implementation of the new policy, the government will just achieve the opposite of its intention. The landlords who can no longer maintain their units will be forced to sell. New owners, realizing the unaffordability of current rental rates, will drastically increase rents to match their costs of owning the units. Even though the annual rent increase has been lowered, the overall rent rises due to frequent tenant and landlord turnovers, making both parties the loser in the long run.
Instead of artificially controlling rent increase, a better solution to solving the housing crisis is to encourage more people to become landlords and promote free market competition. More units equal greater supply, and a corresponding decrease in rental costs. Instead of control on rent increase, incentives on owning units would be far better in the grand scheme of things.
Rent control did not work well in Ontario, and the general consensus among economists is that it is not the ideal solution to solving housing crisis. We have faith in our government to do what is best for all the affected parties, landlords and tenants included, and would beseech the party in charge to re-consider reducing the current rental increase rate.
A Group of Concerned Landlords
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