06 Sep 2024
Allowable Rent Increases For 2025 in BC
The provincial government recently set the maximum allowable rent hike for next year to be capped at 3%. This rate which is tied to the inflation rate, will take effect on January 1, 2025, and is down from the 3.5% implemented this year. If utilities and other fees are included in the monthly rent, it cannot be increased beyond this percentage even if the costs are higher.
“Tying the allowable increase to inflation saves renters hundreds of dollars, over the previous government’s policy of inflation plus 2%,” said Ravi Kahlon, BC’s minister of housing.
“At a time when we know renters are struggling, our rent cap protects renters against unfair rent hikes, while allowing landlords to meet rising costs so that rental homes can stay in BC’s housing market.”
The Rental Housing Task Force has advocated tying the allowable rent increase to inflation. The province uses the 12-month average per cent change in the Consumer Price Index for BC ending in July of the year prior to the calendar year.
The provincial government has implemented the annual renter’s tax credit, which provides $400 per anuum to low- and moderate-income renters across the province and is the first jurisdiction to support the creation of provincewide rent bank services to provide interest free loans to tenants with dire needs.
The Residential Tenancy Act (RTA) requires landlords to provide a full 3 month notice to tenants if they wish to increase the rent. It should be noted that the 3% cap does not apply to commercial tenancies, housing co-operatives, some assisted living facilities and non-profit residential tenancies in which rent is adjusted to the tenant’s income.
Tenants have complained that any increase is going to hurt, especially for those with lower incomes and there are calls for a change to the rent control formula by the landlords.
Landlord BC commented that rental increase freezes during the pandemic and higher interest rates have made it difficult for landlords to deal with taking on the cost of insurance, repairs and property taxes.
“It’s not just the mom-and-pop landlords, it’s across the sector. It’s very challenging times,” said David Hutniak, Landlord BC CEO. “We are encouraged by the fact that interest rates might finally start coming down, because we are highly sensitive to the high cost of money.”
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