Townhouse construction: industry says new supply is the solution to shortage of rental housing as well as high purchase prices.

B.C. aiming to improve tenant protection

Housing Minister Rich Coleman says solution to rent increase loophole will take time, NDP's John Horgan wants action now

The B.C. government is considering legislation to close a loophole that allows landlords to raise rents beyond provincial limits using fixed-term leases.

The current law restricts annual rent increases to no more than two per cent plus the rate of inflation, a maximum of 3.7 per cent for increases that take effect in 2017.

In a tight urban rental market, some landlords get around the cap with lease termination clauses that allow them to set rent higher in a new lease, for the existing or a new tenant.

In extreme cases, there have been bidding wars for rented as well as purchased homes in Metro Vancouver. LandlordBC, the professional association for owners and managers of rental housing, says the practice violates its business standards and is confined to “a small cohort” of owners.

B.C. Housing Minister Rich Coleman issued a statement this week after the latest opposition call for action to protect tenants.

Coleman said the province is “looking at options to ensure fixed-term tenancies continue to balance the needs of both tenants and landlords and that parties are acting consistently with the intent of the Residential Tenancy Act around annual allowable rent increases.”

Coleman said legislation “will take some time to complete” and in the meantime, parties who have signed a lease are bound by its terms, including termination.

NDP leader John Horgan blasted Coleman for inaction on the situation, which opposition critics have raised repeatedly as rental housing has become scarcer.

“With some unscrupulous landlords, they’re evicting and forcing tenants to sign a one-year lease,” Horgan said. “Mr. Coleman’s fixation on LNG at the expense of addressing issues for renters, I think is the problem.”

Horgan said several housing issues could be addressed now if the B.C. Liberals had followed their own schedule and convened a fall sitting of the legislature. Another change the NDP wants is to free universities and colleges to construct new student housing.

The rental shortage is so bad that students are “forced to sleep in cars, they’re forced to couch-surf, they’re forced to sleep in academic buildings,” Horgan said.