Recently, the province of Ontario introduced new legislation to protect tenants from unfair rent increases, which includes rent control reform.
The Ontario Liberal Party created Bill 124, the proposed Rental Fairness Act, which would make all private rental units subject to rent control.
1What is rent control?
Rent control is a system of rent regulation. In this case, annual rent can only increase by 1.5 per cent annually as of 2017, in accordance with inflation. It can only be raised by that percentage if a 90-days notice is given. Rent control is only effective for tenants who renew their lease.
2What is the positive?
According to Conrad Spezowska, the spokesperson for the ministry of housing, “housing costs are rising dramatically in Ontario, and there are not enough affordable rental options to meet people’s needs. That’s why we’re addressing high rental increases by delivering substantive rent control reform as part of a review of the Residential Tenancies Act (RTA).”
According to E.H from the Economist, “supporters argue that introducing controls helps ensure that households on low and middle incomes are not squeezed out of cities in which housing costs are soaring.”
3What is the negative?
Most economists believe rent restrictions lead to a reduction in housing available in the market as people have less incentive to fix up and rent out their property, according to E.H. This also leads to degrading quality of housing since landlords can’t raise their rents. Supply becomes limited because of rent caps.
4When can landlords raise their rents under rent control?
“Under current rules, landlords can set rents at market rates for new tenants (vacancy de-control),” explained Spezowska. “Keeping vacancy de-control will help to continue to foster a healthy investment climate for landlords.”
5Will this make it harder to find housing near campus?
If students do terminate their lease, the landlord has the right to raise the price of the property above the rent cap, if it is vacant under current rules. Rent cap only applies when leaser renews their lease.
Due to rent control limiting the number of houses that will be available for rent on the market, “the government is proposing a new targeted, $125 million, five-year program to rebate a portion of development charges for new multi-residential rental apartment buildings” to encourage construction of student apartments,” Spezowska said.
Spezowska went on to say, “The government is also proposing to establish a program to leverage the value of surplus provincial land assets across the province to develop a mix of market housing and new, permanent, sustainable and affordable housing supply.”
6Does this apply to on-campus residences?
“The RTA applies to most residential rental units but does not apply to educational accommodation (i.e., student dorms),” said Spezowska.
7What do I do if my landlord stops maintaining my rented property?
“The RTA requires landlords to maintain their buildings in good repair and comply with health, safety, housing, and maintenance standards. Tenants who believe that their building is not being maintained should contact their municipality,” explained Spezowska.
You can contact the Region of Waterloo at 519-575-4400.