January 15th 2024
There are a lot of challenges being a residential landlord these days. That’s for sure. But one of the major ones is our governing legislation, The Residential Tenancies Act. It’s there. It’s a reality. We need to understand it and work with it. But as I say, it’s a challenge.
First, we need to understand that it is consumer protection legislation. As such, it is very one-sided in favour of the tenant. And, because there are a lot more tenants than there are landlords, and each one gets a vote, don’t hold your breath on it being modified to bring it into balance any time soon.
I had occasion to speak to the Attorney General recently. The guy who is responsible for the implementation of the Act. Seemed like a really decent guy and one who I came to learn is in a position to understand things from a landlord’s perspective. He told me, for example, that prior to entering politics, he was a practising lawyer and he set up the landlord’s association for the municipality where he worked. So, he should be in a position to understand the challenges landlords face under the current legislation. And the conversation gave me a chance to further enlighten him from a landlord’s perspective.
Basically, I’m working on the assumption that the Residential Tenancies Act isn’t going to be overhauled, at least not in the near future. And if and when it does, I don’t expect it’s going to move to the betterment of the landlord. But beginning with that reality, it allowed me to cover two important points.
First, was implementation. I explained to him that a great start would be to act fairly and decisively on the existing legislation. Why is it that when a landlord brings an issue before the board, seeking an eviction order for non-payment for example, it takes a minimum of 8 months to be heard, while on the other hand, when a tenant complains about landlord issues, the matter gets dealt with within 72 hours? Let’s make the speed of justice uniform regardless of the issue or who initiated it. In reply I was told that there were lots of enforcers on the tenant side, but only a very limited number on the landlord’s side. That’s perhaps an explanation as to what needs to be fixed. Well…fix it. And I believe he was genuinely shocked at the 8-month delay. He felt it was less than 4 months. I encouraged him to listen to the on-hold recording which tells the landlord caller to ‘call back in 8 months if you haven’t heard from us.’. I also cited one of the examples of incidents we have encountered where a tenant was given 60 days’ notice to vacate because the property was sold and the buyers required the property for himself. The tenant called the Board and was told ‘don’t worry. You don’t have to move out in 60 days. It’ll take the landlord months to evict you.’ He was shocked. Don’t know why. The notice itself tells tenants they don’t have to move out. You can challenge the eviction order. This is a significant problem in the case of a buyer needing the unit. Their life plans are in the balance. 60 days should mean 60 days. Enforce the Act! If the notice was being misused, challenge it after the fact. Don’t jeopardize honest situations because of the odd incident of misuse.
And the other thing I brought up is the serious problem of below-market rents and the challenges that creates. The Attorney General at this point reminded me that the government had brought in legislation removing rental units built after November 15th, 2018 from the restrictions of rent control.
Yes, I said, but all that did was create two tiers. It didn’t solve the problem. And because property values have gone up so much, there is now a lot of misuse as new landlords exercise non-fault evictions in an attempt to raise rates to market rent. I cited one personal example where I have a tiny one-bedroom apartment which rents for significantly more than a spacious three-bedroom apartment I have with in-suite laundry. And in the small bedroom, the tenant pays for heat and hydro.
So, I suggested to him, why not set up a landlord-rental advisory board, which any landlord can apply to and have a third-party access market rent for the unit. Charge $200-$300 for each application to cover administration costs. And allow the landlord to raise the rent to prescribed market rent over a three-year period, much like MPAC does with taxes. This will do away with eviction misuse as well as chronic imbalances in the rental marketplace. It will also stimulate building and investment in residential dwelling units. And overbuild will bring down and stabilize the rents.
His response, which I believe was genuine, was to tell me that it was an interesting concept and he would honestly give it some thought.
Don’t hold your breath, but at least the seed was planted.