Policy & Positions Manual
Provincial Issues - Energy and Mines - Housing
Rental Tenancy Act (2009)
Rental Apartment Buildings and other types of rental accommodation, manufactured home parks for example, in British Columbia are for the most part owned by small business owners. Their commitment and investment to the rental housing market is substantial. Through formalized memberships in the Building Owners and Managers Association of BC (BCAOMA) and the Rental Owners and Managers Society of BC (ROMS BC) well over 2,000 business owners are located throughout most if not all municipalities in British Columbia
These business owners are regulated by the British Columbia Provincial Residential Tenancy Act. Section 23, Items 1-5 of this Act identifies conditions in which rent increases may be determined. Greater rent increases equate to a greater return on investment for the business owner, and in many cases prevents the business owner from suffering a loss on their investment.
For a variety of historical reasons the new construction of private rental housing units in British Columbia has virtually ceased. The existing return on investment compounds that serious problem and penalizes these business owners to an unfair degree.
The business owner may increase rental rates using formulas, including an average of the past 12 months Canadian Price Index (CPI) plus 2%. Unfortunately the CPI does not accurately reflect normal CPI index factors for apartment buildings. For example, the flow through costs of natural gas can be an unmanageable expense as can a number of other building expenses.
THE CHAMBER RECOMMENDS
That the Provincial Government amend the Residential Tenancy Act to allow use of the true flow through cost of operations, rather than CPI plus 2%, when actual operational costs are in excess of CPI plus 2%.
