Rent freezes and eviction bans introduced in many Canadian provinces, including Alberta, as economy contracts
Alberta has joined a growing list of Canadian provinces that have imposed more restrictions on landlords during the COVID-19 pandemic.
Today, Premier Jason Kenney announced that nobody could be tossed out of their homes for nonpayment of rent or utilities before May 1.
Kenney also froze rents while Alberta's state of emergency remains in effect and declared that late fees cannot be imposed on tenants over the next three months.
"We are expecting landlords and tenants to work together to figure out payment plans that help everyone meet financial obligations as we manage COVID-19, and we are doing further policy work on support for renters during these tough times,” Kenney said.
This announcement came on the same day that the Office of the Parliamentary Budge Officer outlined a COVID-19 scenario in which the unemployment rate could rise to 15 percent in the third quarter of 2020.
In recent days, B.C. premier John Horgan and Manitoba premier Brian Pallister also announced freezes on annual rent increases, effective April 1, for those whose livelihoods have been affected by COVID-19.
Horgan nullified a decision last year to allow annual rent increases of 2.6 percent (2.6 percent plus a proportional amount for the change in local government levies and regulated utility fees in manufactured home parks).
In addition, Horgan pledged a moratorium on evictions until the COVID-19 pandemic had been brought under control except when there were safety issues.
And B.C. Housing would provide up to $500 per month for three months in rent subsidies for tenants with low to moderate incomes.
In Manitoba, Pallister postponed all non-urgent eviction hearings until May 31. The rent freeze overrides an earlier decision to allow 2.4 percent rent increases in Manitoba in 2020.
The governments of Saskatchewan, Quebec, Nova Scotia, New Brunswick, and Yukon—as well as the Prince Edward Island Housing Corporation and Northwest Territories Housing Corporation—have suspended evictions in almost all cases due to coronavirus-related economic challenges.
Ontario has postponed in-person Landlord and Tenant Board hearings.
Landlords complain about higher costs
The B.C. measures have received blowback from landlords.
The Goodman Report, a newsletter written by real-estate agents Mark Goodman and Cynthia Jagger, maintained that if landlords defer payments to financial institutions, it "will cost landlords more without allowing any way to offset the income lost".
"Additionally, while we can appreciate that the rent supplement of $500 will be paid directly to the landlord to ensure receipt of rent, in our market it’s unlikely that this will be enough to compensate for the losses from a protracted rent increase freeze," the newsletter states.
"Further, it’s disappointing that the Province so far offers landlords no way to recoup losses other than the recommendation that banks should allow them to defer mortgage payments," it adds. "So far this isn’t policy but merely a recommendation lacking teeth.
"Finally, as we all know but the Province hasn’t acknowledged, a mortgage deferral comes with compounded interest. Landlords simply don’t get out of paying the mortgage, any more than they get out of paying property tax or operating expenses such as insurance and utilities."
Following publication of this commentary, the newsletter stated that a "bucket-load of emails and calls" came in response from owners of rental accommodation.
One landlord wrote that the eviction freeze "could give tenants virtually an indefinite rent holiday, resulting in all other stakeholders (lenders, cities for property taxes, insurance companies, etc.) to get paid in full, and leave the small number of BC landlords to pick up the shortfall".
The Vancouver Tenants Union, on the other hand, doesn't think that the B.C. government has gone far enough.
It's asking tenants to post their concerns using the hashtag #bcrent crisis because renters "can't count on every landlord being voluntarily understanding or charitable at this time".
In the past, the VTU has advocated for vacancy control, which would limit annual allowable rent increases to the unit, even after it's vacated, rather than to individual tenants.
Landlord B.C. and the Urban Development Institute, which represents developers, vehemently fought that idea, saying it would stymie the construction of new apartments.
Vacancy control was not recommended by the NDP government's B.C. Rental Housing Task Force in its December 2018 report.