London renters in new buildings experience Toronto-style rent increases
Andrew Lupton | CBC News | Posted: March 29, 2022 8:00 AM | Last Updated: March 29, 2022
Buildings constructed after 2018 aren't subject to provincial rent increase guidelines
To the Doug Ford government, it's a policy designed to encourage developers to build more rental stock and, in the process, help cool fast-rising rental rates.
But critics say a 2018 decision to exempt new apartment buildings from provincial rent increase guidelines is leaving new tenants at the mercy of sudden rent increases, bringing to London challenges already well-known to renters in the Greater Toronto Area.
On Monday, CBC News reported about the concerns of residents at One Richmond Row, a new apartment building in downtown London that began taking its first tenants last year.
Most signed one-year leases and over the past few weeks, many have received notices of the landlord's intention to raise rents by seven per cent should tenants continue their leases into Year 2.
Building owner Old Oak Properties will have to apply to the Landlord and Tenant Board for approval, but the increase is likely to be approved since rent controls were removed on new buildings by the Doug Ford PC government.
The story triggered a lot of response, though Old Oak didn't respond to calls for CBC News for comment on Monday.
Issue raised at Queen's Park
London North Centre MPP Terence Kernaghan raised the issue at Queen's Park on Monday, accusing the PCs of leaving renters vulnerable to sudden rent increases.
"They've allowed the greediest developers and corporate landlords to gouge tenants and throw people out of their homes, to make a buck," he said.
"Will this government do the right thing and return rent controls to buildings built after 2018 ... yes or no?" he asked
MPP Jim McDonell, who represents Sormount-Dundas-South Glengarry and is parliamentary assistant to Housing Minister Steve Clark, took the first question. He said the PC moves have created incentives for developers to build more rental units.
Michael Parsa,Ford's deputy government house leader whose riding is Aurora—Oak Ridges—Richmond Hill, took the supplementary question.
"When you reduce red tape, when you increase inventory through proper decisions, it will make housing more affordable for Ontarians," said Parsa.
Can city hall step in?
Although rent control falls under provincial jurisdiction, one city councillor said rising rent is an issue she and her colleagues may need to address.
"This is a new problem in London, but it's something that Toronto residents have been dealing with for a while," said Coun. Mariam Hamou.
Hamou said many tenants aren't aware that rents in buildings constructed after 2018 aren't subject to rent increase guidelines. She said city hall may have to consider a bylaw that would require landlords to tell prospective tenants about the rent increases they could face.
"Building managers have to be clear with people before they rent," she said. "For them to ding you that much in the second year, I don't think that's acceptable."
She said the increases leave tenants with a tough choice: Stay and swallow the higher rent or deal with the cost and trouble of moving.
Hamou said it's an issue more Londoners will be facing as the city continues to add rental buildings in the downtown core. A city report from 2017 said fewer than 5,000 people lived downtown. A similar report in 2021 estimated the number of downtown residents at 7,900.
"There has to be something where we are able to warn people before signing a lease," she said.