Nova Scotia housing crisis: Canadian jurisdictions with rent control weigh in

As the end of Nova Scotia’s provincial state of emergency looms, many tenants fear what could come next.

The current two per cent rent cap, introduced last year to protect tenants from steep increases during COVID-19, is set to expire in February 2022 or when the state of emergency ends, whichever one comes first.

But while it’s not known yet when that might happen, some renters are already receiving notices that their rent will increase — some by hundreds of dollars — once it’s allowed.

Recently-elected Premier Tim Houston has repeatedly said that he does not support rent control. He said he would like to focus on bringing more housing into the market instead.

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But he hasn’t proposed any plans yet to protect renters who are facing increases of hundreds of dollars in the meantime.

Six provinces across Canada have some form of rent control in place. Global News has spoken with people from three of them — Quebec, Manitoba and P.E.I. — about how the system is working.

Quebec

In Quebec, rent increases are tied to inflation and repairs to the building. In cases where the tenant doesn’t agree with the increase, the landlord must file an application through a tribunal.

Avi Friedman, a professor and the co-founder of the Affordable Homes Program at McGill University’s School of Architecture, said this form of rent control naturally favours the tenant.

He said there has been “very little addition to rental stock in the past few years” and developers are reluctant to build more rental housing, so it is a “double-edged sword.”

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But Friedman said the real issue is years of neglect in building more social housing. He said in the past, Quebec used to build a “great deal” of social housing but doesn’t anymore.

When left up to private developers, there are fewer options for people looking for an affordable place to live.

“Let’s keep in mind that landlords and developers are not building from the goodness of their heart. They’re building because they’re profit-motivated. They would like to make money,” said Friedman.

“The social need of a tenant, it’s not uppermost on their agenda, or mind. So the need to have a mechanism that makes sure that someone will not be kicked out, thrown out of their apartment, is extremely important, especially when there is no other alternative.”

Rent control, when balanced to meet the needs of both landlords and tenants, should be a permanent fixture, he said.

Hearing stories of Nova Scotia tenants facing increases of hundreds of dollars, he said lifting the rent cap before more housing is available would be “disastrous.”

During the federal election, all three major parties are making big promises to get more housing built. But Friedman is skeptical.

“These kinds of promises are always made before elections, but years later they’re forgotten, and we still come back to a situation where people cannot find accommodations,” he said.

“Affordable housing — be it rent, or ownership — is one of the challenges that Canada is facing and it needs to be addressed systematically, similar to the way that we address other issues in this country, like health care.”

Manitoba

In Manitoba, the provincial government makes a determination, based on a number of factors like the consumer price index, on how much rent should increase. This year, the rental increase guideline is 1.6 per cent.

Jino Distasio, a geography professor and the vice-president of research and innovation at the University of Winnipeg, said each year, this is usually something that’s contested on both sides — both by landlords who want to charge more, and tenants who want to pay less.

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Distasio said “there’s no perfect system” in terms of setting rental increases, and said rent control needs to be part of a broader set of policies to support tenant rights.

“So on top of rent control,” he said, “you also need a good Residential Tenancies Act, usually at the provincial level, to really entrench the responsibilities of tenants, landlords, owners and other stakeholders to ensure that we not only have an affordable housing market, but we have a housing market that’s safe and secure and equitable.”

In Manitoba, landlords can apply for a larger increase, and places where rent is $1,570 or more is exempt from the policy. As well, units built and occupied after March 7, 2005, are exempt from rent control for 20 years.

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Distasio said rent control should be geared to supporting moderate rents and incomes so tenants aren’t financially ruined by “unfairly seen rises in rents.” In order for this to happen, there needs to be a strong non-profit and public housing sector to have a more robust market — both for-profit and non-profit — so there’s a “balance of opportunities for people to find housing.”

While Manitoba’s “multi-decade experiment in rent control” has exposed some limitations, he said “generally speaking, the market has come to accept that in Manitoba, we’re going to put some parameters around how rents increase to allow for some stability in a very important part of our society, and that is housing.”

Distasio said about a decade ago the vacancy rate was very low and that put pressure on the market to add more units.

He added that while the housing crisis is a national issue, there are challenges unique to each region and it’s important to look at this problem from the lenses of the people most affected, like lower-income people, Indigenous people and immigrants.

“We know that on any given day in this country, well over 30,000 Canadians will have nowhere to spend tonight or tomorrow,” said Distasio.

“So our challenge is balancing rent control, access to homeownership, with the needs of even just the basic necessities of any type of home for those at-risk or experiencing homelessness in Canada.”

P.E.I.

On P.E.I., rent increases are decided by the Island Regulatory and Appeals Commission and are tied to a number of factors including vacancy rates and CPI. That number is one per cent for 2021.

Connor Kelly with the Cooper Institute and PEI Fight for Affordable Housing said the system isn’t perfect, but it does help protect tenants against astronomical increases.

“If we didn’t have that, we’d probably be seeing what’s been happening in Halifax happen on P.E.I.,” he said. “It’s probably the only reason we haven’t had the housing crisis accelerate as fast as it has accelerated in other places.”

He said rental increases on the Island are tied to units, not tenants, so in theory this system should prevent “renovictions” or situations where landlords jack up rent when a new tenant moves in.

However, Kelly said there are gaps in this system because it’s not well enforced and penalties for landlords who break the rules are minimal. He also said renovictions are “very common.”

“The tenant that moves in has to have contact with the previous tenant to know what the previous rent was,” he said. “Otherwise, a landlord can evict somebody who’s paying $800 a month, and then in a couple of weeks bring someone else in and make them pay $1,200. That happens a lot on P.E.I.”

He said his organization is pushing for a public registry of units and their rents but the government hasn’t implemented one yet.

Kelly also rejected the idea of rent control disincentivizing developers from building more units, saying that hasn’t been the case for P.E.I.

“We have so much construction that government can’t hire more people to build housing, because everybody’s already busy building housing,” he said. “The housing market’s way too profitable for rent control to slow it down.”

But the biggest issue at hand is how society looks at housing to begin with. Kelly said housing should be considered as a human right, rather than as an investment from which private companies and landlords can profit from.

“So long as there’s profit to be found in housing, the housing crisis is going to exist,” he said.

“The whole system of profiting off housing has to change.”