N.B. to consider making landlords justify rental increases, minister says

New Brunswick’s minister responsible for housing says the province is looking at forcing landlords to justify rental increases above a certain threshold.

Jill Green confirmed to reporters on Thursday that the measure is one of several changes to the Residential Tenancies Act being considered, but any changes will have to wait till the spring.

“There’s a number of different aspects of the Residential Tenancies Act that we are considering making changes to,” she said.

“We met with stakeholders in August, they provided us information on what they thought the changes should be … and we’re considering every single one of those and that’s one of the ones on the table.”

That would be a shift from a suite of proposed changes that would make tenants responsible for challenging what they believe to be an unreasonable increase. Legislation before the house would give tenants 60 days to file a complaint with the Residential Tenancies Tribunal, which will then consider prices for units in a given building and area. It would also allow the tribunal to spread large increases over the course of three years to soften the blow for tenants.

Liberal housing critic Benoit Bourque proposed forcing landlords to justify increases earlier this week, something he described as an “olive branch” to the minister. He says he’d rather see the rent cap continue into 2023, but says putting the burden on landlords is a good compromise.

“If there’s not going to be a rent cap, what’s the next best thing? Well, I agree with the idea of having the owners having the onus to justify the increases,” he said.

The Liberals plan to propose an amendment to the residential tenancies bill before the legislature to make that change. A similar attempt by the Greens earlier this year when the rent cap was put in place was defeated by the government.

2:08 NB tenants call for reform to NB’s Residential Tenancies Tribunal

Green housing critic Megan Mitton says the uncertainty from the government over what it plans to do is creating chaos and leaving tenants unprotected.

“What is their plan and what is their evidence to back up that plan? It seems to be changing from day to day, what is going to happen, what isn’t going to happen,” she said.

“It’s clear that the priority is not protecting tenants, it’s not protecting New Brunswickers, it’s clear that that’s not the priority for this minister and this government.”

Bourque worries that waiting until the spring to make changes will leave tenants vulnerable to large increases in the meantime and may even incentivize some landlords to file increases before the cap ends.

Green argues that since landlords must give six months’ notice of an increase to rent, that’s unlikely to happen, and says the tribunal is there for anyone who receives an increase they find unreasonable.

The province has justified ditching the rent cap by saying that it’s deterring development. Green says that building permits for buildings with two or more units are down from last year. According to Green, as of Thursday, there have been 104 permits issued, while there were 186 last year.

That’s important Green says, because permits are an indication of future building activity.

But data from Statistics Canada looks quite a bit different. Permits for a “multiple dwelling building” over the period from January to October of this year are up slightly over the same period last year, with 401 issued compared to 395.

The total number of units covered by those permits was down slightly over that period compared to last year, with 2,863 issued compared to 3,021.

Building starts, which is a measure of current construction, are up this year over last, with more “apartment and other unit type” housing starts in the first three quarters of this year than in the entirety of 2021.

When asked how she can draw a direct link between a decline in building permits and the rent cap rather than labour and supply shortages, Green said that’s why it’s important to consider all available data, but said the permits and an important indicator.

“As I said there are many many different complexities relating to the housing file and I have to look at them all and that’s one piece of it absolutely,” she said.