THIS EPISODE: Rent Control and Rent Hikes
In Ontario, we have rent control on buildings occupied before November 15, 2018. That means the landlords for these buildings can only raise rents for current tenants once a year at a percentage or “guideline” set by the Province. If they want to raise the rent higher, they have to apply for an Above Guideline Increase (AGI), and their stated reasons have to meet certain criteria such as paying for expensive improvements to the building or hiring security.
But researchers have been studying these increases to how and where they’re applied, who is affected, if they’re being used appropriately.
Two of the researchers studying AGIs are University of Toronto Scarborough Professor Julie Mah and University of Waterloo Associate Professor Martine August. They worry these above guideline increases are being used by landlords as an extra revenue tool or even a means to push tenants out. Here’s Martine:
For tenants in these buildings, the landlords are doing things like trying to push people out with more eviction filings, effectively maybe pushing them out through economic eviction as prices are getting higher, making life very unpleasant through very disruptive renovations, while at the same time they’re own individual units are going left and neglected, and then also achieving higher rents through vacancy when people do leave. So it’s kind of lots of different things going on, lots of strategies being used, and lots of loopholes to rent control being exploited in ways that harm tenants and benefit landlords.
To find out how these AGIs affect tenants, we spoke to Douglas Kwan, director of advocacy and legal services at Advocacy Centre for Tenants Ontario. He questions whether AGIs are even necessary in many cases, when the landlords make more than enough from current rents:
It’s really a scheme that is open to abuse because there’s no measure in terms of forcing landlords to justify that type of passing down of the cost is necessary. There’s no analysis in terms of what’s the overall income that they’re generating, rate of return of investment on these buildings to justify passing it down to tenants. And so that’s why tenants are angry. Because they know and see that landlords are earning quite a significant amount of income from their buildings. Why can’t they use that income to pay for the necessary repairs that they’re responsible for?
Are rules around rent increases being exploited for profit?
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