Lost Control

| Fri, Jun 3, 2011 | 3028

News & Views

Renter Jess Huber (top left), provincial NDP leader Lorraine Michael (top right), St. John's Deputy Mayor Shannie Duff (bottom right), realtor and landlord Brad Stone (bottom right). Illustrations by Morgan Murray.

Rent is on the loose while the province’s economy booms.

April 1st was a lousy day for Jess Huber. She had been living in her downtown-area two-bedroom apartment since December of 2009 and, despite its few problems, she had no plans to move.

Then she and her partner got a letter from her landlord saying that, as of July 1st, their rent would be $750 instead of $650 — a 15.4% increase.

“We were pretty surprised, given the problems that we’d been experiencing — mold, leaking ceiling in the bathroom and so on,” she says. “The landlord didn’t offer to fix those things in lieu of the rent increase. We were good tenants, we paid our rent early, we were clean, and we never asked to sublet.”

She was even more surprised, after calling government services, to learn that the 15.4 per cent rent hike was within the landlord’s right. According to Newfoundland’s Residential Tenancies Act, landlords can’t raise the rent in the first 12 months of an occupancy agreement and, after those 12 months are up, they can’t raise the rent more than once a year.

But they can raise the rent by however much they please.

***

Lorraine Michael, leader of the provincial NDP, thinks the province should be looking at more rent control. She says she hears from a lot of people in Huber’s position. Ontario, British Columbia, Manitoba, and P.E.I. have all introduced fixed amounts by which landlords can raise their rents each year and Michael thinks Newfoundland could learn a lot from their programs.

“I think it’s important because the demand for rental space is so high in our cities,” she says. “We have extremely low vacancy rates in St. John’s, Corner Brook and Labrador West and, because of that, rates are going up by exorbitant rates. You obviously are going to have a law that’s going to take care of both the tenant and the landlord. For example, if a landlord has to put extra money into the property for a major repair, then they can put in an application to raise the rent more than the set standard would allow.”

That, she says, would require the establishment of a separate provincial division to deal with rental housing policy, since one doesn’t presently exist: the Residency Tenancies Board was disbanded in the late 1990s.

***

Shannie Duff, City of St. John’s Deputy Mayor, sits on the mayor’s advisory committee on affordable housing. Duff says the city’s skyrocketing rents have contributed to longer waiting lists for both of the city’s affordable housing programs. But she’s not convinced that rent control is the answer for the people on those waiting lists, or for people like Huber who are just looking for housing affordability.

“The jury is out on that. There are a lot of people who seem to think that is a good idea, but there are two downsides it,” she says. “One is that it tends to discourage any new market housing, and we haven’t had any new rental construction in over 20 years. The second is that landlords under rent control do not maintain their properties.”

Instead, she’d like to see tax incentives and interest rate breaks for developers who build units for low-to-mid range rentals.

***

To an extent, Brad Stone agrees with her. He’s a realtor who also owns properties which he rents out.

“If you made the stipulations too strict, it could dissuade further investment,” Stone says. “If you had a vacant property, for example, or someone just purchased an investment property, and they couldn’t set the rent themselves and had to apply to the government to set the rent — well, I can’t see that working. And from working in real estate I’ve been in a lot of houses, and I know that some don’t do anything to their properties at all — no maintenance, these places are falling apart — and they’re increasing the rents anyways.”

All in all, he thinks that rent control legislation could work, as long as the rights and needs of both landlords and tenants are worked into it.

As for Jess Huber, who has since left her apartment for cheaper rent elsewhere, the solution is a no-brainer.

“Rent control, or even a standardization of rental increases across the province would have been a huge help.”

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13 Responses

  1. avatar
    Robert Says:

    For the first time I have to agree with Lorraine Michael. I have lived in other cities in Canada where rent control is mandatory for large percentage of rental properties and it works perfectly. As for deterring new rental construction, city council is doing a fine good job of that already.

  2. avatar
    John Lewis Says:

    Rent control? A really stupid idea. The ultimate result, as costs increase with inflation, and landlords walk away from their properties, is the loss of rental properties. Rent control has devastated considerable parts of the Bronx, in metropolitan New York, for instance.

    People rent property to make money. At present it is not easy to make
    money renting, and indeed I and a friend have sold off three rental properties in the last three years. The student tenants ranged from not too bad to atrocious. Some of my friends told me not to get into it but I paid them no attention.

    I don’t know what happened to the properties. Ended up in the hands of landlords from Hell, probably.

    The city of St. John’s already has quite a lot of housing for welfare people. I don’t see why students couldn’t be fit in.

  3. avatar
    Vanessa Mary Says:

    Rent Controls could definitely work here as long as it is fairly regulated and more rental unit are built rather than condos! There is a need for more apartments at reasonable rates in all areas of St.John’s.

  4. avatar
    Steve Says:

    The new 500 bed residence under construction at MUN will certainly help the rent situation. That’s 500 students who are now in apartments who will be able to live on campus when the building is finished. Hopefully the vacancy rate will tick upward a bit and ease the pressure for rent increases.

    Also, there was a comment in the article that the Residential Tenants Board was disbanded. I don’t know anything about that, but there is a Residential Tenancies Division of the Department of Government Services, which will look into complaints from both landlords and tenants in terms of compliance with the Residential Tenancies Act: http://www.gs.gov.nl.ca/landlord/residential_tenancies.html

  5. avatar
    Paying my fair share as well as somebody else's Says:

    There are of course, two sides to every story. As property values increase, so do property and water taxes. Landlords are not going to take that hit themselves and will pass them on to their tenants. Unfortunately, many take it too far, and up the gouge factor just because they can. Rent controls could work provided that they ensured landlords a competitive return on their investments compared to alternatives. As a landlord, I would look at the implications very closely though. There is a point where your money is better invested elsewhere or that your property would fetch an much greater immediate profit by converting it to a single unit and selling it as a normal residence.
    Is more public housing the answer? Perhaps, but if it causes the mil rate to creep up, it will also contribute to even more rent increases. There has to be a happy medium somewhere.

  6. avatar
    anon Says:

    There is definitely already a huge problem with landlords that dont care to maintain their properties in this city.

    I would love to see some of the apartments in this city inspected by a third party who knows what theyre doing. Many (especially from the big property rental companies) are not up to code.

  7. avatar
    Danielle Says:

    Rent for a house in St. Johns is from $900 – $2000 on average its $1200 for a house and $800 for a one bed apartment a month, pou. You take a single working person with a full time 40 hours a week at min wage they well gross $1600 then with taxes maybe takes home $1000 of that. Tell me how a person can live on that when rent and heat is more then what they make. There needs to be laws to help people who just need a place they can afford to live that’s not in such poor conditions that only rodents can live there.
    We need to do something before everyone is living on the streets!

  8. avatar
    Anonymous Says:

    Here’s a solution that other people have known about for a very long time, except for Scope readers that is; Roommates. That’s what you do when you cant afford to rent an entire house or apartment and pay the bills by yourself. It’s really quite simple. And if you don’t want roommates (most of us don’t) well I guess you try to get a better job.

  9. avatar
    Naddy Says:

    Isn’t it wonderful how people like Shannie Duff and Brad Stone can make these negative comments about Rent Control, in St John’s, Newfoundland. Let me guess you people must be making around $35,000 per year or less – come on, you can say all of these ridiculous comebacks because it does not affect your living standards one single bit. You are not living paycheck to paycheck like many of us are.

    There will always be landlords who do absolutely no work on their rental properties. These landlords only fix what they have to fix in order to make it “so called livable conditions.” It would not matter if rent control came in or not, these scum landlords are out there only for the money!

    On the other side of the coin, if you are fortunate enough, you will find a landlord who cares about his property and maintains his/her property.I have been fortunate to find one like that. My rent and car payment takes up practically all of my income. So to people like Shannie Duff, Brad Stone or Lorraine Michaels, whose income succeeds far more than the average working person, YOU have no idea what it is to live like most of the people in St. John’s are living! I am paying $1900 a month p.o.u. I looked at many other places before I chose this apartment and they were dumps and some of them had even higher rent than what I am paying now. I would not let a cat or dog live in some of these houses and there is no rent control on these properties, are there? So rent control would not make these landlords stop maintaining their properties because they are not maintain now – with no rent control. Yet we have people living in them, paying out rent to Landlords who do not care one single bit as long as they get their monthly rental income.

    Rent control HAS to come in to effect in St, John’s and surrounding areas. People can not afford to live. I am working three jobs just to make ends meet and at the end of the week there is very little money left to do anything. I am always crossing my fingers that my car doesn’t break down and I am sure that there are many more people like me out there. One of my jobs are with the provincial government and the other two are minimum wage jobs. I can not even begin to imagine how difficult it must be for people with a lower income. Very low income qualifies for subsidized housing, high income people don’t have to worry, but how about the average working person? What do we qualify for? Nothing, that is what we qualify for. It is time for the government to stop thinking about themselves and think about the people of St. John’s!

    As for you, Shannie Duff and everyone else who makes the so called decisions, why don’t you drop your $100,00 or more income and try living like the common working person and try to live comfortably? I wonder how long it would take for rent control to come in to effect if they had to live like us?

  10. avatar
    Naddy Says:

    Well Anonymous…aren’t you the brave one. Think you got all the answers! Your remark is repulsive. I have you know that I have a decent job. I work with the provincial government. In fact I have two other jobs and two children on top of that. So get off your high horse and do a reality check. This is not all about you! It is about other people who need a break in the rent! It makes me sick to think that there are people out there like you. I have a university degree and I work darn hard to make ends meet. I have even taken in a boarder to help my family maintain a decent life. I work my @#% off to ensure that my children are taken care off. Reality check Mr/MS Anonymous…..the cost of living is rising above peoples wages and making it very difficult to live. People like you need to walk in our shoes for a year or two and then come back with your disgusting remark. I bet you would have a whole new perspective if you did that!

    Also, not everyone has the education to get better jobs as you put it. There are many hardworking decent people out there working their butts off to make ends meet while people like you insult them for their hard work. Shame on you!!!!!

  11. avatar
    Smoot Says:

    Hey Anonymous, Danielle clearly said that even one bedroom apartments here are often $800 p.o.u. (which I feel is too expensive for a dump, like the one my boyfriend and I currently occupy). Do you suggest one roomers also get roommates? How many? Do the people that have to sleep in the tub get a discount? You’re an asshat.

  12. avatar
    Anonymous Says:

    The only problem here is that a lot of you people expect to get everything for nothing. The supposed low-vacancy rate doesn’t take into account all of the available rooms out there, just look on kijiji and you will see all of the low-income people and students who have apartments with extra rooms and are desperate to find someone to move in and split the rent. So instead of whining about not being able to find a perfect one bedroom apartment for penny rent perhaps you should consider moving in with one of those people and helping them out. There are plenty of affordable places to live, even if it may not be exactly what you want.

  13. avatar

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