B.C. sets maximum allowable rent increase for 2024

B.C. sets maximum rent increase for 2024 For the second year in a row, the B.C. government has set the maximum allowable rent increase below the rate of inflation.

The maximum rent increase B.C. landlords can impose on existing tenants next year has been set at 3.5 per cent, the government announced Monday.

This marks the second year in a row that the allowable increase has been set below the rate of inflation, as officials attempt to balance the needs of renters and property owners.

"Across the country, costs have been increasing – especially for housing – at a rate that's unsustainable for many people," Housing Minister Ravi Kahlon said in a statement.

The maximum allowable rent hike for 2023 was set at two per cent, which was met with criticism from tenants advocates and landlords alike.

While next year's increase is higher, the Ministry of Housing described it as "well below" the 12-month average inflation rate of 5.6 per cent.

Since 2018, maximum rent increases in British Columbia have been tied to inflation, matched with the average rate of the Consumer Price Index from the one-year period ending the previous July.

The province implemented a rent freeze during the early years of the COVID-19 pandemic, however, and has since limited annual increases twice over concerns that surging inflation would force some families from their homes.

Officials intend to return to CPI-linked increases “in future years,” the ministry said in a news release.

RENTAL PROJECTS PAUSED

Landlords have slammed the government's approach, arguing rising costs and interest rates have already affected their bottom line, resulting in some purpose-built rental housing projects being paused or abandoned.

Speaking at a news conference in Kamloops Monday, B.C. Premier David Eby described the loss of those projects as among his "biggest concerns," and argued more rental stock is crucial to getting skyrocketing rents under control.

"That's why we're working with local governments and using our own land to build rental housing people can actually afford," Eby said.

Meanwhile, tenant advocates have pushed for additional rent freezes and other measures to protect renters from homelessness, arguing many would have significant difficulty finding affordable housing if they were to be evicted.

One recent report found the average rent for an available one-bedroom unit in Vancouver now tops $3,000 a month.

REAL NUMBERS

For most tenants in the province, an increase of 3.5 per cent would mean paying several hundred dollars more per year – an amount that would, in some cases, exceed the latest increase homeowners faced on their property taxes.

Renters who currently pay $3,000 would have to pony up an additional $105 a month, or $1,260 a year. Those who pay $1,500 would have to pay an extra $52.50 a month, or $630 a year.

By comparison, the owners of single-family homes assessed around $2 million owed an average of $326 in additional property taxes as a result of Vancouver's 10.7 per cent increase for 2023.

The province's maximum allowable rent increase doesn't apply to commercial tenancies, non-profit housing where rent is tied to income, co-operative housing or some assisted living facilities.

Landlords can only apply the 3.5 per cent increase beginning Jan. 1, 2024, and must provide their tenant with three months' notice. According to the Ministry of Housing, if a landlord tries to apply next year's allowable increase before the end of 2023, the hike is "null and void and the tenant does not have to pay it."