CMHC encourages higher rents, landlord alleges

A Calgary landlord is accusing a federal Crown corporation of contributing to the city's skyrocketing rents.

Glenn Coulmanalleges Canada Mortgage and Housing Corporation told him to hike his rents by more than 40 per cent after he requested a mortgage refinancing to buy more investment property.

"CMHC was quite insistent that there would be no insurance— they would not provide their services to us unless we increased the rent."

But a spokesman for theorganizationsaid that while he can't comment on specific cases,CMHChas no policy of advising landlords to raise theirrents.

"What we normally do isadvise theapplicants, the borrowers,to reallylook at the project viability. For example, is the project viable enough to sustain the operations? And[is] the current rent level thatthey are charging at par with [the] market?" said T.J. Lee, a regional manager with the corporation.

Coulman saidhe was charging $850 a month each fortwo two-bedroom apartments in Windsor Park. Heneeded CMHC to insure the refinanced mortgage, but there were strings attached, he said.

Coulmanalleged he was told to hike his rents by more than 40 per cent to $1,200 a month per unit. Hesaid he doesn't need the extra money and he has no desire to "gouge" his tenants.

"I'm stunned that in light of everything that they've been saying regarding high rents and making things affordable, and with the publicity over high rents, that they would even be considering doing this, that it would even be a policy of theirs."

Landlord refused to raise his rents

Monty Solberg, the federal minister responsible for CMHC, told CBC News the corporation is not directing landlords to hike rents in order to qualify for mortgage insurance.

"What people are being told is we're there to work with them to find ways to get them housing and get them the mortgage insurance they need to go to lenders and be successful in getting a mortgage."

Meanwhile, Coulman has found another way to finance his property purchases — with a line of credit — so he hasn't had to increase his rents by 40 per cent.

Soaring rents, sparked by higher home prices and plummeting vacancy rates,have been a hot topic in Alberta this month.

Earlier this week,MLAs passed a bill limiting rent hikes to one a year, and mandating that landlords give tenants a year's notice if they want to convert apartments to condos.

However, the bill didn't include rent controls, an ideasupported by the provincialNew Democrats and Liberals, leading to a protest at the legislature by angry renters.