When British Columbians faced rising inflation and low-vacancy rates in 1973, the New Democratic government of Premier Dave Barrett introduced the Residential Premises Interim Rent Stabilization Act.
The legislation tied rents to units rather than to tenants, as is done today.
Half a century later, a coalition led by the BC General Employees Union (BCGEU) is calling on the current NDP government to re-introduce such legislation.
But vacancy controls face opposition from both inside and outside of government.
When voices favouring vacancy controls rallied on the lawn of the legislature Wednesday, their timing was not accidental. It not only coincided with the release of a BCGEU report that “dispels myths” around vacancy controls, it came after Monday’s announcement of the allowable rent increase for 2024.
The maximum increase will be 3.5 per cent, “well below the 12-month average inflation rate of 5.6 per cent.” It applies to rent increases with an effective date on or after Jan. 1, 2024. If landlords choose to increase rent, they must provide a full three months’ notice to their tenants. Landlords can increase rent only once every 12 months.
But these measures do not go far enough, because of various loopholes, BCGEU’s executive vice-president Kari Michaels said. Landlords can charge whatever they want for new tenants.
Tying rent to units would discourage upward swings and give tenants financial certainty, she said.
“Vacancy control is a meaningful intervention that would make a difference on day one and show people in British Columbia that the government is finally taking bold steps to stop this crisis from escalating further.”
She pointed to a BCGEU-commissioned poll from last year that found 62 per cent of British Columbians would support such a measure.
“So we want the government to understand that not only is this a well-founded, solid policy that could be implemented for the benefit of the vast majority of people in B.C., but it is also something that it widely popular,” she said.
Wednesday’s rally raised questions about the level of satisfaction with the current government’s record on housing from groups normally in the NDP corner.
Michaels said BCGEU launched its Affordable BC campaign in 2017, and met directly with government on key policy initiatives.
“We were glad to see that a number of those initiatives had been implemented in some form over the last several years, but we know there is more that needs to be done,” she said. “We are still feeling the acute issues around affordability and the stability. The message is that we need to see policies and changes that make sure people are able to afford and live in communities across the province,” she added.
“We have heard from the Minister of Housing (Ravi Kahlon) and the Premier (David Eby) that they have looked at vacancy control and they haven’t been interested in pursuing it,” she said, adding that she is hopeful Wednesday’s rally will help them change their minds.
Other jurisdictions have implemented vacancy controls, but their record can be read as mixed. Analysts have stated that an exclusively economic lens on vacancy controls does not capture other benefits.
One thing is certain, landlords in B.C. generally oppose the idea. This stance shone through in a column from David Hutniak, chief executive officer of LandlordBC.
Writing in the fall of 2022, Hutniak said vacancy controls would deny rental owners the ability to adjust rents between tenants to account for building and unit upgrades and other increased costs. Property taxes, insurance and utilities have also been rising significantly.
Vacancy controls would also rob owners of incentives to make necessary improvements to their units and ultimately discourage rental construction, he argued.
Hutniak built on those points during his recent presentation to the committee collecting public submissions as part of the 2024 budget.
“On the issue of turnover rates — this is when a tenant moves out, releasing the unit to the market — the turnover rate of rental units in Vancouver, which is the largest rental market in the province, is currently 4.9 percent,” he said. “This is the lowest turnover rate that our organization has ever witnessed, and we’ve been around for 60 years. That means that over 90 percent of the rental units in the market are essentially permanently occupied by the current tenants.”
“It’s clearly bad for new renters trying to find a place to live, a home, and unsustainable for the rental housing providers,” he said, adding something has to give.
“We need workable solutions here right now,” he said, calling for more housing supply. “Strong measures that provide rental housing providers with the necessary ability to decrease and stabilize expenses are needed.”
Housing Minister Ravi Kahlon said in a statement to Black Press Media that the government’s 2018 task force on rental housing considered but ultimately rejected vacancy controls because it would have the unintended consequence of reducing affordable rental stock.
“Recognizing the significant pressures renters are facing, we are full steam ahead to create even more new rental supply to help make housing more affordable – both by building new units and things like expanding the speculation and vacancy tax to new communities and eliminating strata rental bans, which have opened up thousands of existing vacant units for rental,” he said. “Since 2017, the province has more than 76,000 homes that have been delivered or are underway throughout the province.”
He also pointed to changes beyond capping the 2024 annual rent increase amount to 3.5 per cent to help renters such as tougher penalties for bad-faith evictions and better protection of their rights.