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Rents on the Rise: Licensees’ Responsibility in Rent Price Increases
In September 2023, the Government of B.C. raised the maximum allowable rent increase on residential properties from 2 per cent to 3.5 per cent, effective January 1, 2024. In a statement, the Minister of Housing said the move aims to address rising costs, especially for housing, that are increasing at an unsustainable rate for many landlords and tenants.
If you’re a rental property manager representing a residential landlord, it’s important to understand your responsibilities if your client directs you to increase a tenant’s rent.
The Residential Tenancy Branch sets the amount landlords may raise rent each year, and the Residential Tenancy Act and the Regulation (“RTA”) addresses permissible and prohibited rent increases.
A landlord can increase rents above the amount stated by the Residential Tenancy Branch only if agreed to by the tenant in writing or if they have obtained an Order authorizing a rental increase from the Residential Tenancy Branch. They are not permitted to raise rents outside of the provisions of the RTA. If your client asks you to raise the rent outside of these provisions and you do so, you will have breached the Real Estate Services Rules (“Rules”) as well as the RTA. Under the Rules, while licensees must follow lawful instructions, if the request is a breach of other legislation, that would be considered an unlawful instruction. The Rules also specify that licensees must deal with tenants honestly and with reasonable care and skill.
If a client instructs you to act in a way that would breach legislation, you can take the following steps:
- Explain why the instruction is unlawful;
- Refer them to the Residential Tenancy Branch; and
- Refer the client to legal advice if they persist in their request. You may need to cease providing services to the client.
You can find more details on the Residential Tenancy Branch website, including the following provisions:
- The RTA allows landlords to increase rent once every 12 months in an amount up to the maximum percentage amount permitted; and
- Landlords must provide three months’ written notice of a rent increase using the required form.
Finally, licensees should be aware that rent can’t be increased because a new landlord buys the premises, nor can it be increased arbitrarily because the landlord perceives it to be below market rates.
