Housing providers are on the verge
You may have received our email from March 25th with an update on what the B.C. provincial government announced as it pertains to the rental industry. As things are moving quickly, we have since made some amendments which you can read here.
We are continuing to pose questions and await answers on this announcement – what is the timing of this subsidy program roll-out and portal for applications? Is the rebate paid to the owner on title or could it be sent directly to the property management company if requested? As this is starting April 1st, and there is a requirement for three months’ notice on rent increases, this is effectively a retroactive policy, correct? Should rent increase notices continue to go out given there is a 3-month lead time (even if they are not payable right away)? What is the impact, if any, on notices to vacate where the owner has either sold their home or plans to move in?
Feedback from our readership
We’ve received a bucket-load of emails and calls in response to the new government rental policies over the last two days. Some argue the only way through this crisis is to force lenders to share some of the burden – the province doesn’t have the legislative authority to do anything about mortgage payments. Additionally, while a $500 potential monthly subsidy that will be paid to landlords if the tenant qualifies and makes the application, it’s unlikely the landlord will get the subsidy from every tenant in need. Some will apply, but undoubtedly, some will not. Furthermore, some asked whether there will be any penalties for those who choose not to pay when they have the ability to do so, or those who use government funds when they shouldn’t. Financial relief must be made available for the people who are truly in need, of which there are many.
One landlord wrote to us:
“My wife and I are retired. We have worked hard our entire lives and saved our money. 18 years ago we bought a rental building in Vancouver. Since our purchase we have re-invested everything it produced back into the building. We live a modest life and rely on our building to support us in our retirement. Tenants may think that it was the Premier that has given BC tenants the support they so desperately need. But in fact, it will be landlords like me that will ultimately pay the significant cost of doing so. I am fearful that in the end, after working through this crisis, we will lose everything we have worked for our entire lives. And the travesty will be that every other stakeholder in the residential rental business will get paid in full, and won’t have to share any of this burden at all.”
“The freeze on evictions 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.”
It has been suggested that landlords can offset the cost of this freeze by deferring their mortgage payments. The mayor of Vancouver has suggested the same by offering a 2-month deferral of property taxes. Although a good sound bite, this is very misleading. Deferral just means that ultimately the landlord is expected to pay everything that is deferred. And where will landlords get the money to pay the amounts deferred? The $500 subsidy will help a little. But the rest can only come from future rents or the landlord’s own pocket.”
“These policies will cause a severe blow to our City’s rental stock with many properties falling into disrepair. Lenders may be forced to foreclose on properties that have been devalued so they are underwater on their mortgages. Who will run them and keep them safe and clean? And let’s not forget there is also a devastating human cost to our housing providers who are being left out in the cold with no assistance.”
If you wish to voice your concern and offer alternative solutions, please consider emailing Housing Minister Selina Robinson, Premier John Horgan, Mayor Kennedy Stewart, MLA Spencer Chandra Herbert.