The provincial government has introduced legislation to close a major loophole in fixed-term leases and improve the rights of renters throughout British Columbia, Municipal Affairs and Housing Minister Selina Robinson announced today.
Robinson says the new legislation will mean landlords can no longer use the loophole to bypass annual rent control, meaning renters will now be protected against massive rent hikes at the end of a lease.
“We are protecting the rights of renters who, for too long, have been left open to unfair and unjustified rent increases,” said Robinson, introducing amendments to the Residential Tenancy Act and Manufactured Home Park Tenancy Act.
“By closing this loophole, renters will know they’ll be able to stay in their homes without the threat of skyrocketing rents.”
If passed, the amendments will:
- Restrict a landlord's ability to use a vacate clause in fixed-term tenancy agreements to certain circumstances only; and
- Limit rent increases between fixed-term tenancy agreements with the same tenant to the maximum annual allowable amount (currently 2% plus inflation).
“Our top priority is eliminating fixed-term tenancies with vacate clauses,” said Andrew Sakamoto, executive director, Tenant Resource and Advisory Centre.
“This type of agreement is increasingly being used by landlords wanting to circumvent rent controls and evict tenants for reasons outside of the Residential Tenancy Act – practices that do not align with the spirit and intent of the legislation. We look forward to the provincial government closing this harmful loophole that is exacerbating our rental housing crisis.”
The new rules will apply to both new and existing tenancy agreements.
“LandlordBC has expressed concern publicly for some time now about the industry’s inappropriate application of this form of tenancy,” said David Hutniak, CEO, LandlordBC.
“We are in the business of providing secure, long-term rental housing,” added Hutniak. “The fact that a cohort of our industry has utilized this form of tenancy to unnecessarily force good tenants from their homes, or have them face rent increases significantly above the allowable maximum in order to remain, is the reason we support this move.”
The legislative amendments will also streamline the dispute resolution process for the return of security deposits. If a landlord doesn’t return a security deposit, a tenant will be able to apply for a monetary order through an expedited process. This will ensure that tenants get their deposits back more quickly – three weeks instead of waiting up to six months.
- The amendments follow other recent steps the Province has taken to improve services for landlords and tenants in B.C.
- In September, the B.C. government added $6.8 million in new funding for the Residential Tenancy Branch to reduce wait times for tenancy disputes and to establish a new compliance unit to take action against landlords and tenants who are repeat or serious offenders.
- The Province also launched a new online application to make it easier and faster for tenants and landlords to apply for dispute resolution.
- The Residential Tenancy Branch promotes successful tenancies by providing tenants and landlords with information on their rights and responsibilities.
- The branch also plays an administrative justice role by resolving tenancy disputes.
- Each year, the branch receives between 20,000 and 22,000 applications for dispute resolution.
For information about residential tenancies, visit: www.gov.bc.ca/landlordtenant
To find out about dispute resolution, go to: www.gov.bc.ca/landlordtenant/dispute
Access to the new online application is available here: www.gov.bc.ca/landlordtenant/online
A backgrounder follows.
Lindsay ByersMinistry of Municipal Affairs and Housing
The ministry has consulted with key stakeholders to identify under which circumstances a landlord will be permitted to use a vacate clause in fixed-term tenancy agreements. For example:
- A person might need to rent out their home during an extended absence for work or travel but has firm plans to return on a particular date; and
- A tenant needs to sublet a rental unit for a set period of time.
There are two situations involving existing fixed-term tenancy agreements where a vacate clause can still be enforced. If, before the day the legislative amendments were introduced:
- A landlord, expecting their tenant to move out at the end of the term, has already entered into a tenancy agreement with a new tenant; and
- A landlord was granted an order of possession requiring a tenant to vacate the unit, but the possession order has not yet taken effect.
The proposed changes will also strengthen the ability of the Residential Tenancy Branch to enforce compliance under the Residential Tenancy Act and Manufactured Home Park Tenancy Act.
The amendments will allow the branch to:
- Compel the production of documents as part of a penalty investigation;
- Publish penalty decisions;
- Refuse to accept an application for dispute resolution if an administrative penalty is owed; and
- Pursue prosecution where penalties have been levied, but there is still no compliance.