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Ontario tenants hammered with double-digit rent hikes

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When Sacha Proctor received a notice from his landlord that his rent would increase 17.6 per cent on May 1, he tried to move to a similar unit with a lower price tag in the same building.

“But they refused to meet with us,” he said. 

“The refused to tell us why we got the high increase, refused to let us transfer to a cheaper unit or what other similar units were renting for.”

Proctor lives in a 2 bedroom plus den apartment with his girlfriend and their two dogs. His rent increased from $1275 to $1500 (excluding hydro) on May 1. 

“A tenant with a similar apartment received a $325 increase,” he said. 

“Some people received $250 dollar increases. Some tenants have received $35 increases that follow the guideline. Some tenants haven’t received a single increase in the last three years.”

And it’s all perfectly legal.

Each year, the Ontario government announces the province’s Rent Increase Guideline for the following year. 

Ontario’s annual Rent Increase Guideline is based on the Ontario Consumer Price Index (CPI), which is a measure of inflation calculated monthly by Statistics Canada. 

The rate of allowable rent increases for 2013 is 2.5 per cent.

The guideline is the maximum amount that most landlords can increase a tenant’s rent during the year without making an application to the Landlord and Tenant Board.

But all residential units built after 1991 are exempt from the Rent Increase Guideline and landlords can increase rents as much as they like every 12 months, provided they give tenants 90 days notice in writing.

“I’m sure this law was designed so landlords could raise rents across the board, help create new rental properties, make improvements to the building and meet market values,” said Proctor.

“(But) the law was not designed so landlords could single people out they don’t like and evict them easily without going through the eviction process.”

On Tuesday afternoon, NDP Municipal Affairs and Housing Critic Cindy Forster introduced a Private Member’s Bill to close the exemption in the Residential Tenancies Act that currently allows landlords to increase rents above the Rent Increase Guideline.

It’s called the Residential Tenancies Amendment Act.

“Removing the rent control loophole is an important step in improving the affordability of housing in Ontario and protection from large rent hikes,” said Forster.

The exemption was introduced to increase the residential rental stock.

“However, this plan has not panned out in Ontario and very little new rental housing has been built. Yet for tenants living in these buildings it has been 20 years of uncertainty and unfairness.”

As it stands now, 45 per cent of Ontario tenant households already pay more than 30 per cent of their income on shelter; 20 per cent pay more than 50 per cent.

In 2010 when she was the NDP Housing Critic, Cheri DiNovo introduced a similar Private Member’s Bill.

“This exemption is leaving tenants at risk and so I look forward to members from all sides of the floor to support this effort,” she said.

As the NDP GTA Issues Critic and Davenport MPP, Jonah Schein hears regularly about the growing affordable housing crisis in Toronto.

“I hear this from families, families with two parents in the workforce,” said Schein. 

“I hear it from people on Ontario Works and ODSP. And I hear it from single professionals living in condos in our downtown core.” 

Since 1990, median tenant incomes have fallen by 13 per cent, leaving tenants vulnerable to humongous rent hikes.

This year, Adam and his partner had their rent hiked 12 per cent from $1250 to $1400 a month. 

“And the tenants only choice is to accept the new rate or move,” said Schein.

Melissa saw her rent increase by 5 per cent the first year and 7 per cent the following year. If not for the moving costs and time needed to search for a new place, pack and move, she would have sought new accommodations.

Another tenant wrote to Schein about 6 per cent increases, two years in a row, that eventually forced her to  move out.

“These stories are not unique,” said Schein.

“Hundreds of tenants in my riding and tens of thousands across Ontario are in the exact same situation. With no rent control they're left vulnerable to arbitrary rent increases.”

The Advocacy Centre for Tenants Ontario (ACTO) sees people on a daily basis who are struggling to keep a roof over their heads.

“The right to stay in your home is essential to tenants being able to be part of their community,” said Kenn Hale, ACTO.

“If your rent can be arbitrarily increased you have no feeling of security. You don’t know if you’re going to be able to afford to live there next year.”

In many communities, housing built after 1991 is the only housing with vacant units.

“Often low income people end up having to share these expensive units,” said Hale.

The Federation of Metro Tenants’ Association (FMTA) hotline has received calls of rent increases of 30 per cent and more.

“This was after a request for repairs from a landlord,” said Christian Forbes, FMTA. 

“This is nothing short of abuse by landlords. It gives them a tool to evict people by making their place unaffordable.”

Leaving tenants with no recourse. Because it’s a legal rent increase that’s grounded in law.

In the last ten years, condominiums have accounted for 70 per cent of new constructions while only 8 per cent of new buildings were designed specifically for rental purposes only.

“It’s estimated that more than 30 per cent of new condo units are being rented,” said Forbes. “And those ones can face any kind of rent increase that the owner sees fit.”

Forbes said landlords with buildings built on or before 1991 can take advantage of vacancy decontrol (which means they can charge whatever initial rent they want to new tenants) and apply for above guideline rent increases.

“They have many mechanisms available to prevent their business going south,” he said.

“And I don’t know what the real advantage of an exemption that goes back 20 years really provides.”

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