John Lehmann/The Globe and Mail
In a tight rental market, are tenants protected?
Advocates say Vancouver's extremely tight rental market opens the door for abuse – and tenants don't have the protection they need, reports Mike Hager
Kristina Lemieux feared her comfortable housing situation might change when the three-suite apartment complex she had lived in for five years was sold last summer. Ms. Lemieux, a freelance arts administrator, grew worried when her new landlord reached out quickly to all three tenants asking for an in-person meeting, telling them he preferred face-to-face interactions and didn't want to communicate via e-mail.
She became furious when, less than two weeks after the sale, he said he needed to increase their rents from around $1,100 a month to at least $1,800 per suite. He needed the rent increase, he said, to get his $1.6-million investment back. If they didn't comply, he warned, he would use one of several loopholes that had helped him kick out tenants of previous buildings: by claiming he was moving in himself or needed them gone to do a major renovation of the units.
The threats prompted Ms. Lemieux to turn to the provincial agency in place to protect tenants' rights and settle disputes with landlords – a scenario that appears to becoming more common in a tight market in which some landlords have found creative ways to get around rules designed to limit rent increases and protect renters from eviction. Moreover, critics say the laws currently in place in B.C., which differ greatly between provinces, aren't strong enough to protect renters, and even when tenants are abused, the system is slow and difficult to access.
At Ms. Lemieux's building, she and another tenant vowed to dispute the eviction notice, while the third agreed to pay the higher rent. But Ms. Lemieux's ally eventually decided it would be too stressful to spend the dozens of hours and hundreds of dollars to build a case for the Residential Tenancy Branch, leaving her to fight on her own.
Several months later, Ms. Lemieux became one of the minority of complainants to have her dispute resolved through the tenancy branch, which resulted in the arbitrator brokering a settlement that allowed her to stay for three extra months, including one month rent-free.
"If you lacked education or came from a disenfranchised part of society, there's no way you'd make it through the system – it's so complex," she said. "I have the capacity to fight the system and I feel like it's my responsibility to not let it stand."
Still, she's now paying roughly 30 per cent more in rent per month since she moved, and she's still chasing her previous landlord through the same system for a damage deposit she is confident she will never get back.
With vacancy rates hovering around zero, renters in the Vancouver region feel they often have little choice but to accept a landlords' terms, even if they're problematic – or illegal.
The situation appears to be a little better in Toronto – the country's next hottest real-estate market – where advocates say more funding and stricter rules give tenants stronger protections.
In B.C., legislation limits the amount landlords are able to increase rental rates for their current tenants. This year, that limit is 2.9 per cent, much lower than the average increases in rental rates across the province, which were 3.9 per cent higher in the Vancouver region in 2015 and almost 5 per cent in downtown Vancouver.
To get around those limits, some landlords have found loopholes to throw out tenants in order to chase bigger rents. Those tactics include using fixed-term contracts, which allow landlords to demand entirely new leases – with unlimited rent increases – at the end of a specified time period, typically a year; so-called "renovictions," in which a landlord legally evicts a tenant for major renovations and then doubles or even triples the rent for whoever moves in next. Landlords can also evict a tenant if they, or a close family member, plan to move into the property.
Ontario, in contrast, gives renters the right to "security of tenure," which means that at the end of any lease, the tenancy automatically continues rolling month to month unless the landlord has lawful reasons for eviction, such as moving in themselves or placing a close family member in the unit. And even if a renter must vacate the unit for renovations, they must be invited back at roughly the same rate.
When disputes arise in B.C., aggrieved renters and landlords have access to only one bricks-and-mortar RTB office, located in Burnaby. The majority of complaints are funnelled into a phone system where, recent government records show, almost a quarter of all callers abandon their attempts rather than wait the average hold time of 34 minutes.
In Ontario, the Landlord and Tenant Board has eight offices across the province, including five in and around Toronto. Agencies in both provinces allow tenants to file at welfare offices across the province or electronically, though in B.C. tenants are required to register for an online provincial services account first.
Ken Hale, legal director at Toronto-based Advocacy Centre for Tenants, said one of the biggest differences between the two provinces is that Ontario adequately funds groups like his to help people struggling with the housing market's failure to provide enough affordable housing. Provincial government funding allows the non-profit group to provide a full-time lawyer to help complainants at each of the eight branches in the Toronto region, as well as centres in London and Ottawa. It also offers up part-time lawyers for those participating in housing hearings held across the province's smaller communities, he said.
"Part of this is tenants need to educate themselves about what their rights are if they want to keep a roof over their head," Mr. Hale said.
Jane Mayfield, acting executive director at Vancouver's Tenant Resource and Advisory Centre, says renters in B.C. find it difficult to learn how the system works and navigate it because there is no legal aid available to them from the province. Instead, four or five non-profit organizations have taken that role, she says. Her organization, which is funded by the provincial and municipal governments, and the law foundations of B.C. and Ontario, usually prioritizes groups of renters, as opposed to individuals, in order to help the most people.
Mr. Hale says once tenants do get a hearing, the difference between the two provinces is stark.
In Ontario, every hearing, except those in remote rural areas, is held in person before an adjudicator that makes a legally enforceable decision.
Cases in B.C. are handled over the phone, which Mr. Hale says makes it "extremely difficult" to judge the credibility of both parties and have an appropriate exchange and review of documents.
David Hutniak, CEO of Landlord B.C., which represents the rental housing industry, praised the Residential Tenancy Branch for recently hiring three new arbitrators, and he said the agency is making progress on improving its technology. Still, he said more work needs to be done by the branch, his association and others to better educate landlords and tenants so disputes can be resolved before they reach the hearing stage.
Calls to B.C.'s tenancy branch have increased in recent years, from 268,000 in the 2013-2014 fiscal year to roughly 307,000 in 2015-2016. Yet, the budget for the agency has stayed constant at about $8-million.
Rich Coleman, the provincial cabinet minister who has been in charge of the housing portfolio over the past 15 years, was unavailable for an interview. He has had that responsibility despite being rotated through several different cabinet positions over the years. A spokeswoman for his current ministry, Natural Gas Development, did not say why the tenancy branch's budget has flatlined for the past six years as calls have continued to rise. The spokeswoman said application fees were raised from $50 to $100 at the start of the year. That has brought in $585,000 extra this fiscal year, she said, which went toward new staff, increasing hearing capacity and decreasing hearing waiting times; and expanding online services and alternative dispute resolution options.
Vancouver New Democrat MLA Spencer Chandra Herbert says his office in Vancouver's West End has had at least one constituent call or visit with a complaint regarding their landlord almost every day since he was first elected in 2008. Last year, the average rent in his constituency rose 6.1 per cent and a typical renter paid $1,274 for a one-bedroom apartment, according to the Canada Mortgage and Housing Corp.
Mr. Chandra Herbert says the province could help B.C.'s pressured renters immediately by closing the "renoviction" loophole to enshrine a tenant's right to rent any unit renovated by their landlord – at their current price.
"The incentive to evict is then gone," said Mr. Chandra Herbert, who has had several similar bills amending the current tenancy law rejected by the Liberal government over the past eight years.
"The legislation should be clear so that no one has any doubt that you've moved in, you live there and, unless it's a life safety issue, you have security of tenure," he said. "If you want to negotiate with your landlord to put in fancy cabinets or something like that, sure you have the right – and you may have to pay a bit more rent if you negotiated that.
"But the landlord doesn't have the right to kick you out just because they want to put in a new set of tiles and then jack the prices, as they've been doing."