The Metro Vancouver Housing Corporation’s “market rents” in its 52 housing complexes often fall significantly below true market rents in the region, according to a staff report that will go to the corporation’s board on Friday (November 20).

Regional housing manager Don Littleford and regional housing finance division manager Karen Bickford authored the report, which includes no recommendations.

“Over the past few years, MVHC had independent market rent appraisals completed on a number of properties,” they write. “These showed that typical rents tenants were paying were under market by a range of 5% to 30% in some buildings, and as much as 57% in higher rent areas such as Vancouver.”

Littleford and Bickford note in their report that, in September, the MVHC board approved rent increases of 7.4 percent in 2010 in “complexes where rent is most out of step with the market”.

The Metro housing corporation has previously raised rents in the market units in accordance with B.C.’s Residential Tenancy Act, which permitted increases of 3.7 percent in 2008 and 2009. The staff report states that when a tenant vacated a suite, the MVHC has sometimes “successfully charged rents on turnover of up to $300 more than the amount currently paid by existing tenants”.

In a phone interview with the Georgia Straight, Littleford claimed that it’s legal for the MVHC to impose rent increases higher than those permitted under the Residential Tenancy Act. He said that this can be done because the legislation gives the MVHC an exemption from the rental-increase limits applied to other landlords. “We can’t get legal certainty,” Littleford acknowledged. “I’ve spoken to the head of the residential tenancy office about that.”

He added that the MVHC could obtain legal certainty if it chooses to put its case before the residential tenancy branch. Another option, Littleford said, is to impose the 7.4-percent rent increases and wait for tenants to challenge them with the branch. “We’ve got, in Vancouver, a number of buildings where the difference between market rent and what the tenants are paying has grown to too big a difference,” Littleford said. “It’s up to 40 percent. We think even if we have to defend it before the [residential tenancy branch] arbitrator on the basis of good common sense, we can use the provisions in the act.”

However, Littleford emphasized he doesn’t believe this will be necessary, because the MVHC has an exemption from the rent-increase regulation.

The report to the corporation board lists rents paid at several MVHC projects and compares them with the appraised rents. For example, at a complex called Habitat in Vancouver, tenants typically pay $1,185 for a two-bedroom suite, whereas the appraised rent was $1,800 as of November 2008. Three-bedroom units typically rent for $1,300 or $1,400, whereas the same appraisal determined the market rent to be between $2,000 and $2,200, depending on the unit. At Manor House in North Vancouver, tenants typically pay $750 for a one-bedroom unit, whereas the market rent was $920 as of November 2008, according to an appraisal. Two-bedroom units typically rent for $895, whereas the appraisal determined the market price to be $1,140.

Most of the MVHC projects are designed for families. Exceptions include the Claude Douglas, the Hugh Bird Residence, and the Regal Place Hotel in Vancouver’s Downtown Eastside, which are mainly designated for single people. Kelly Court in Vancouver is for tenants with disabilities.

According to the report, there are two categories of tenants: RGI (rent geared to income) and LEM (lower end of market). Littleford said that approximately a third of tenants are on some sort of subsidy program, and the other two-thirds are paying market rents.

“My view was ramping people up at 15 percent was not unreasonable,” he declared. The board, however, decided instead to raise market rents by slightly less than half that amount.

New Westminster mayor Wayne Wright is the president of the MVHC, and Surrey councillor Judy Villeneuve is vice president. The other members of the board are Vancouver councillor Geoff Meggs, Burnaby councillor Colleen Jordan, Richmond councillor Bill McNulty, City of North Vancouver mayor Darrell Mussatto, West Vancouver mayor Pamela Goldsmith-Jones, Coquitlam councillor Mae Reid, City of Langley mayor Peter Fassbender, and White Rock councillor Mary-Wade Anderson.