Too Expensive Rents When You Get Rental Home
The defenders of the rights of tenants want Quebec to create a rent-roll. To prevent increases in “abusive”. When I ask owners of apartment buildings what they think, they all tell me: when a record of bad tenants?
Subsequent stories: an owner must finance because a cat has peed all over the carpet, to the point where the owner had to pull the carpet and replace it entirely. A tenant has painted in a dark red two-room apartment – even if the regulation prohibits the building. A pig’s waste piles in the living room or throws out the window …
Returning to the rent roll it would allow tenants to know, in a phone call, the last price paid for an apartment that interests them. And go complain to the Board if the new prices posted there are too high. This proposal is defended. It is a question of law and transparency.
But the part of owners, who often benefit from a change of tenant to raise their prices, it is feared the arrival of such a register. A growing number of new tenants could use to limit rent increases.
The real problem
The crux of the problem is the control by the Board of Housing rents in Quebec. The increases suggested for years, are disconnected from market realities. And well below the price development of the buildings.
Yes, rents rose sharply in 10 years but much less than the cost of homes and buildings. What about municipal taxes, following the same trajectory. Should we be surprised that the owners seek to increase their rents to reflect the market and cover their costs?
Abuse surely exists, as everywhere. The owners are not angels. They are there to make money. But in the context of sudden increases in rent can sometimes be justified. For example, if the previous tenant had been limited for years the price of the rent with the Reggie, some owners will take advantage of the move to put the price of their rent in the market.
Above all, control of rents – if it does not match the reality of the real estate market – can have disastrous long-term effects. First, it makes it less profitable to build new rental housing (why do you think it is built so many condos in Montreal and so little rental housing?)
Not only reduces the stock of buildings but also it’s quality. The owners will be reluctant to invest and renovate their homes if they can cover their costs with an increase in rents. And given the housing shortage and price controls, some do not even feel the need! They know that renovation or not, their homes will be rented at the same price.
In the end, you end up with less housing and shortages. Result: the owners remain with the upper hand. We’re no further ahead.
To help households to collect higher rents, it would be wiser than the government directly subsidizes families and individuals. Such direct assistance would target those who need it – for the wealthy also benefit from rent control. Above all, avoid the negative effects of a policy of rent control, which in the long run, causes more damage than good.