Province introduces legislation to close fixed-term tenancy loophole
The provincial government has introduced legislation to close a major loophole in fixed-term leases and improve the rights of renters throughout British Columbia.
The new legislation will mean landlords can no longer use the loophole to bypass annual rent control, meaning renters will now be protected against massive rent hikes at the end of a lease.
If passed, the amendments will:
- Restrict a landlord’s ability to use a vacate clause in fixed-term tenancy agreements to certain circumstances only; and
- Limit rent increases between fixed-term tenancy agreements with the same tenant to the maximum annual allowable amount (currently 2% plus inflation).
The new rules will apply to both new and existing tenancy agreements.
The legislative amendments will also streamline the dispute resolution process for the return of security deposits. If a landlord doesn’t return a security deposit, a tenant will be able to apply for a monetary order through an expedited process. This will ensure that tenants get their deposits back more quickly – three weeks instead of waiting up to six months.
Further details on amendments
The ministry has consulted with key stakeholders to identify under which circumstances a landlord will be permitted to use a vacate clause in fixed-term tenancy agreements. For example:
- A person might need to rent out their home during an extended absence for work or travel but has firm plans to return on a particular date; and
- A tenant needs to sublet a rental unit for a set period of time.
There are two situations involving existing fixed-term tenancy agreements where a vacate clause can still be enforced. If, before the day the legislative amendments were introduced:
- A landlord, expecting their tenant to move out at the end of the term, has already entered into a tenancy agreement with a new tenant; and
- A landlord was granted an order of possession requiring a tenant to vacate the unit, but the possession order has not yet taken effect.
The proposed changes will also strengthen the ability of the Residential Tenancy Branch to enforce compliance under the Residential Tenancy Act and Manufactured Home Park Tenancy Act.
The amendments will allow the branch to:
- Compel the production of documents as part of a penalty investigation;
- Publish penalty decisions;
- Refuse to accept an application for dispute resolution if an administrative penalty is owed; and
- Pursue prosecution where penalties have been levied, but there is still no compliance.
Additional Resources
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