Government regulation, meddling hurting housing supply
Re: Rental housing crisis
We are in a rental housing crisis. Government manipulation and continued meddling in the industry has had detrimental effects. B.C. did have fair and balanced legislation and was one of Canada’s leaders in rental legislation. This is no longer the case. Landlords no longer control their property, the government does.
Speculation tax and vacancy tax, “Nobody wants to see multi generational family cottages subject to the tax”, a quote in a recent news story. This is feel-good wishful thinking because that is exactly what it does. This tax forces people with a cottage or a second property to pay ever increasing higher taxes unless they can prove they rent it. They are forced to sell or become landlords. If short term rentals and foreign ownership are a problem, deal with it another way.
“Regulate rent increases between tenancies,” another recent headline. While sounding good, this proposal would be another nail in the coffin in the private rental market. If you want to upkeep your property you must ask government for an arbitration hearing to justify any increase in the cost of providing the rental. Tenant turnover is when one can perform much needed repairs and improvements to achieve a sustainable product and investment return.
The NDP’s regulatory changes in rental legislation were well meaning, designed to help and protect the renter. Unfortunately, these changes have the opposite effect by meddling in a free market and diminishing supply. Property tax, insurance, financing, and repair costs have skyrocketed. Rental increases are regulated below actual cost increases. Old housing stock needs investment to remain viable. If the only profit is in selling, then that is what will happen. Landlords that can are selling. Economics is about supply and demand. Housing is at an unprecedented demand. Government is harming the supply. Regulatory government manipulation is not the solution, a pro investment environment is.