Toward the end of 2016, the Province of Manitoba’s Residential Tenancies Branch quietly set its rent increase guideline for 2017 at 1.5 per cent.
The move was followed by little fanfare or criticism – this was business as usual for a healthy apartment rental market that benefits both tenants and landlords.
Apartment renters in Vancouver and Toronto are no-doubt envious of the stable Winnipeg apartment rental market. This March, residents of one West End Vancouver rental building protested after their landlord applied to increase rents by up to 43 per cent. In Toronto’s downtown Liberty Village neighbourhood, some tenants have seen their rents double in the past year.
Source: http://vancouver.24hrs.ca/2016/03/20/duel-bc-ndp-fudging-on-housing-crisis
What causes these drastic rent increases, and why are they less common in the Winnipeg apartment rental market? Unfortunately, different stakeholders have different answers for the first question.
Some groups will blame landlords. “There’s a cynicism going on in the landlord community where you get rid of a sitting tenant who’s paying $1,000 per month and we can get $1,200 more for this,” Vancouver housing advocate Russ Godfrey told the CBC. “What person in business isn’t going to try and maximize their profit?”
Others, including Wayne Smithies, president of Vancouver building management company Martello Property Services, will point their finger at the municipalities:“The driver for rent increases is tax increases in the City of Vancouver, pushing taxes as high as they can,” he said. “The rent increases can’t keep up with the tax increases.”
The City of Vancouver, meanwhile, believes the province is at fault. “Most of this [rent] increase is seen as a result of an increase in property prices/assessment which the City has no control over as B.C. Assessment is a provincially run organization,” a city spokesperson told the CBC.
“Rent control in some form is critical to ensuring apartments are accessible to young people and middle-and lower-income families, but too-stringent regulations may scare away developers.”
To help tenants in Toronto avoid sudden and drastic rent increases – the kind rarely seen in the Winnipeg apartment rental market – the Province of Ontario introduced in April its Fair Housing Plan, which extends rent control to all units built after 1991 and limits increases to the rate of inflation. Many housing advocates see the move as a step in the right direction, but property developers believe the restrictions will make rental developments less attractive to investors.
Source:http://www.cbc.ca/news/opinion/wynne-housing-measures-1.4083831
“Rent control’s political upside is obvious, but its economic fallout is well documented,” read a Globe and Mail editorial from April. “In the 1960s, new apartment towers sprouted across the city of Toronto. Then rent control was introduced, and new private investment virtually stopped. For a generation, very little new rental housing was built.”
Rent control in some form is critical to ensuring apartments are accessible to young people and middle- and lower-income families, but too-stringent regulations may scare away developers. The Province of Manitoba appears to have found a found an appropriate balance between these two priorities.
In contrast to Vancouver and Toronto, the Winnipeg apartment rental market is a picture of stability: apartment hunters have a variety of options at a range of price points, and developers appear confident in profiting off rental units.
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