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  • Hope Lompe

B.C. NDP makes good on a 2017 promise for renters, as rental prices reach an all-time high

Updated: Jul 5, 2023

The $400 dollar tax break will not provide significant help to renters facing price hikes.

By Hope Lompe

The B.C. NDP government has introduced a $400 rebate for renters earning less than $80,000. But that won’t do much to help Metro Vancouver renters who have suffered through steep rent increases over the past several years.

This rebate was announced by the B.C. government in its 2023 budget. Renters earning less than $80,000 per year will be able to claim a tax credit of up to $400.

The tax credit was originally promised by the B.C. NDP as a $400 rebate back in 2017. Since then, the average rent in Metro Vancouver has increased by $439.

According to Thomas Davidoff, director of UBC’s Centre for Urban Economics and Real Estate, the amount renters are receiving from the government comes down to its priorities.

“Obviously $400 isn't going to solve most people's housing problems. I think a more generous benefit would help renters more. It's really a question of what other budget priorities there are,” said Davidoff.

Davidoff cites inflation, low wages and supply issues as the main culprits for B.C.’s housing problem.

According to BC Stats Consumer Price Index, inflation in B.C. has skyrocketed to a 40-year high of 6.9 per cent in 2022, driving up the cost of goods and housing alike.

“The rental affordability problems are one, there are not enough homes for too many people. Two, people don't make enough money to afford rental market prices. With inflation of all goods, and some people's wages not keeping up with inflation, the affordability problem has only gotten worse,” said Davidoff.

Each year, the B.C. government sets a percentage limit on how much landlords can increase their rent for existing tenants. For 2023 that figure has been set at two per cent.

Currently, two per cent is about $400 per year for the average renter in B.C., meaning almost the entire rebate will simply cover one year’s rent increase.

Rohana Rezel is a data scientist, housing advocate and father currently facing eviction in Vancouver. He worries that without significant policy changes, he will not gain stable housing in Vancouver.

“Our landlord is selling his property and just got an offer. If he accepts we will have to move at the end of May. It is unfortunate because I would like to be in a situation, where I have stable housing but the only way to achieve that is to buy, and that is a big problem,” said Rezel.

From his point of view, the $400 tax credit is a start in helping renters, but he fears the money will just end up back in the pockets of landlords.

Davidoff says that it is very difficult to create a policy that helps renters without also helping landlords.

“These speculations are only partly true. Only about a quarter of any money you give to renters goes to rent. So yes, this does help landlords, but it's very hard to design a program that helps renters without giving some assistance to landlords as well,” said Davidoff.

While landlords are limited to raising rents by a certain amount each year, that only applies to current tenants. If a tenant moves out and a new one moves in, landlords can change the rent to whatever they want.

“So landlords have the incentive to try to find tenants who won't stay very long and get rid of tenants who have been there a long time. Then they can renew the unit at a higher rent,” said Davidoff.

Rental affordability and lack of stability are facing many who are being priced out with the tough choice to leave Metro Vancouver.

Rezel founded Ruede de la Vida, a dance group for charity that has raised funds for homeless youth and settling Syrian refugees. Due to housing issues, many people within the group have been forced to leave Metro Vancouver.

“Out of the 10 couples we started with, we probably have lost more than half just because they got priced out, they move to the island or places like Abbotsford,” said Rezel.

According to Rezel, market housing has very little chance of combating the housing crisis. He views public housing measures as the best option to combat the housing crisis.

“At this point, I don't think there's a solution other than public non-market housing. We haven't built anything of that nature since the 1970s, so there's a 50-year gap that needs to be addressed here,” said Rezel.

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