How weak rent regulations are failing to provide secure homes for renters in Canada

December 13, 2023

Renters across Canada are facing exorbitant rental housing costs, driven by excessive rent increases and the loss of affordable homes. Many renters are left with so few housing options that they can afford, leaving them vulnerable to “economic eviction,” or being forced to live in a home that is inaccessible or so poorly maintained that they present dangers to their health and safety. 

In the absence of strong laws that regulate rents, private landlords are free to charge rents far higher than what is necessary to cover their expenses and make a reasonable profit. This practice is known as rent gouging, and it’s causing rents to climb excessively across Canada to the point that half of renters are worried about being able to pay their rent. In many places, price gouging laws prohibit businesses from taking advantage of emergencies to overcharge for basic necessities. Yet, even though housing is a basic necessity and a human right, rent gouging is legal everywhere in Canada. Moreover, the regulations that do exist vary widely across the country.

Here we provide a breakdown of how each province and territory treats rent regulation, and their shortcomings in ensuring that renters have a secure place to call home. 

Where no regulations exist, renters’ homes are fundamentally insecure.  

In Alberta, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nunavut, and Saskatchewan, rents are not regulated at all. Once per year, landlords can raise the rent by any amount, even if their costs haven’t increased. There is no requirement that rents be stable, fair, or reasonable. 

In these provinces and territories, renters’ homes are fundamentally insecure. No renter can be confident that they will be able to afford their rent for longer than a year, and there is always the risk that they will face an excessive rent increase and be forced to leave their home because they simply can no longer afford to stay. 

In fact, in 2023 the New Brunswick government abolished a rent cap that was in place in 2022. The government enacted new rules which, in theory, require landlords to spread rent increases over multiple years. But the new rules do not limit the amounts of increases, and so they are not effective at ensuring that rents are affordable or reasonable. 

Nova Scotia and Yukon currently have temporary rent caps in place. These caps are important, but they only apply to existing renters, and not to new renters. When a renter moves out of their unit, landlords can charge the next renter of that unit any amount they wish. This is when rents can increase drastically, and landlords do not need to provide a reason to explain why they are changing a far higher amount to a new renter. 

Moreover, Nova Scotia and Yukon both allow landlords to impose fixed-term leases with expiry dates, usually after a year. Landlords can easily evade rent caps by forcing renters to move when their lease expires. 

Where rent regulations exist, only some renters are protected from excessive rents. 

Ontario and British Columbia have longstanding rent regulation systems. However, like in Nova Scotia and Yukon, the rules only apply to existing renters who do not move. Landlords are incentivized to evict renters from their homes so that they can raise rents. 

Renters in Ontario and British Columbia are not fully protected during their leases either. The rules allow landlords to apply for permission to raise rents well above the regular rent increase limits set each year by the provincial government. In theory, these increases are supposed to allow landlords to recoup increases to their operating expenses, such as maintenance costs. But the rules are broken, and in practice landlords are allowed to impose rent increases far higher than their cost increases – widening their profit margins at renters’ expense. 

Plus, in Ontario the rules do not apply at all for renters living in homes first occupied as a rental after November 15, 2018. Once per year, landlords can raise those renters’ rent by any amount they wish.

Only Manitoba, Prince Edward Island, and Quebec regulate rents for units when renters move. This is called “vacancy control,” and it is essential to make rent regulation effective. But the rules in all three of these provinces are flawed in other ways. 

In Manitoba, the rules do not apply for 20 years after a building is built. For renters living in homes built less than 20 years ago, landlords can raise the rent by any amount once per year. The rules also do not apply to renters whose rents are higher than $1,615. Finally, landlords are allowed to apply for excessive rent increases, far higher than their costs have increased – and far higher than the increases allowed in Ontario and British Columbia. 

In Prince Edward Island, landlords can apply for unlimited rent increases at the discretion of a tribunal.  The tribunal has typically prioritized landlords’ profits, leading to some extremely high rent increases. The provincial government recently changed the rules, directing the tribunal to also consider renters’ interests. Time will tell whether the new system will effectively protect renters from excessive increases. 

Quebec is the only province that imposes somewhat reasonable limits on rent increases. However, Quebec places the onus on renters to enforce the regulations themselves, by doing their own calculations and refusing excessive increases. This is particularly difficult for new renters who often have no way of knowing whether the landlord is telling the truth about how much they charged the previous renter. Renters living in homes built less than five years ago are also not protected by any rent regulation.

It’s time for strong rent regulation. 

Protections against excessive rent increases vary widely in provincial and territorial laws, and renters are not adequately protected against rent gouging anywhere in Canada. 

Effective regulations are needed in every province and territory to ensure that rents are fair for all renters, no matter where they live. Whether they are staying in their current home or moving to a new home, whether they live in an old or a new building, whether or not their landlord’s costs have increased, and no matter which province or territory they live in, renters deserve to be protected against excessive rents and rent gouging. 

Join us in calling on all provincial and territorial governments to take action on affordability by implementing strong rent regulation. 

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