Supporters, opponents of rent cap seek change to Liberal legislation
Housing advocates tell MLAs bill is too weak, landlords say it will deter developers from building new units
New Brunswick's housing minister says major amendments to his rent-cap legislation probably won't be possible before it is adopted next week, despite criticisms from both supporters and opponents of the bill.
David Hickey said after two days of hearings by a legislative committee that he's in a hurry to get the cap passed and into effect by Feb. 1 – even after warnings that it has loopholes and that it could deter developers from building more units.
"We're open to amendments but they need to be achievable within the timelines that New Brunswickers are relying on," said Hickey, who is not a committee member but who sat and listened to the presentations.
"We know New Brunswick renters need stability now. ... We're looking to the long-term items to say how can we reform the Residential Tenancies Act to reflect a more modern reality of what's happening in the market in New Brunswick."
Limits on fixed-term leases, for example, would need a database of leases that doesn't exist now, said the minister, who added that change probably wouldn't be possible until next fall.
The legislature's all-party estimates committee took the rare step this week of inviting witnesses to appear to offer comments on the bill, which will cap rents at three per cent.
Once the committee finishes with the bill, it goes back to the full legislature for a likely final vote before Dec. 13.
"I think that something substantive could come out of it," said Tobin LeBlanc Haley, a housing researcher at the University of New Brunswick.
Tobin
LeBlanc Haley, a housing researcher at UNB, says she believes something
substantive could come out of the committee hearing. (Jacques Poitras/CBC)
"I mean the Liberals have a majority so they're going to do what they're going to do, but I think the minister is interested in hearing from key actors and that is genuine."
Housing advocates told MLAs that the cap is a good first step but that it needs beefing up to make it harder for landlords to get around the rules.
Nichola Taylor of New Brunswick ACORN said in Nova Scotia, fixed-term leases have become common: rental agreements that end on a specified date, requiring one tenant to leave and allowing landlords to increase the rent for the next one.
"A rent cap is the first step, but you do need other things in place to stop that kind of harassment and stop that taking advantage of extremely vulnerable people in society," she said.
But apartment owners and developers said the proposed cap is already unfairly tough.
Jeremy Jackson, vice-president at Killam Apartments, was one of the voices at the meeting raising concerns over a rent cap. (Jacques Poitras/CBC)
They said their property tax bills and other costs can increase by 10 per cent, so a three-per-cent rent cap makes it impossible to keep up with spiralling costs.
"If we're going to look hard on the revenue side, we've got to make sure we've got guardrails on the cost side," said Jeremy Jackson, a vice-president at Killam Apartments, which owns more than a quarter of all the units in New Brunswick.
"It's about making sure we've got people motivated to build here."
Fredericton developer Louie Youssef agreed.
"When I hear a three-per-cent rent cap now, I'm like, that's not even doable, unless we're talking about a property tax cap. They've got to go hand in hand."
But Hickey provided data to CBC News from Service New Brunswick that suggested most landlords were not suffering from major property tax increases.
He said 81.6 per cent of owners paid the same amount or less in 2024 as what they paid in 2021, and only 0.8 per cent saw increases in their bills of more than 10 per cent.
PC
MLAs Kris Austin (left), Tammy Scott-Wallace and Richard Ames speak
with Matthew Hayes of the New Brunswick Coalition for Tenants Rights at
the committee hearing. (Jacques Poitras/CBC)
Progressive Conservative MLAs on the committee were sympathetic to landlords, taking up their argument that the cap will make it less likely that developers build more units.
"The more rigid you get on rent control, the more you will affect supply," said MLA Kris Austin, citing a 1992 survey of top economists.
But several witnesses said that was wrong, and that increasing the supply of housing is only one potential solution to the shortage of affordable accommodations.
"That's data about people's perceptions. That's not data about what's happening in Canada right now," Leblanc Haley said, citing more recent numbers showing higher construction starts in Atlantic Canada in the last year — in provinces both with and without rent control.
Matthew Hayes of the New Brunswick Coalition for Tenants Rights argued that owners will use loopholes in the legislation to increase rates, even if the government agreed to protect them from property tax increases.
"You say, yes landlords are business owners, and they have right to profit and so on," he said.
"That's the contradiction of the housing space you're faced with. You have a basic human need and you have rights to private property. Which side do you want to be on? … I know which side I'm on."
Jackson and Willy Scholten, a board member of the New Brunswick Apartment Owners Association, told the committee they'd like to see the bill have a "sunset clause" that would see the cap phased out after the market stabilizes.
They also asked for an appeals process landlords can use if they are facing high costs they can't recoup with a three-per cent increase, as well as an exemption for new apartment buildings.
ABOUT THE AUTHOR
Now thats funny
Austin reference to a 32 year old survey shows he only wants to oppose any thing the government proposed.
Higgs and Austin inactions brought us to this place, never saw the previous government holding open committee on anything.
David Amos
Reply to Gary Webber
Bingo
Bob Smith
Folks like Jackson and Scholten want gov't to ask for no property taxes, no rent caps and free market to dictate what is rent. Oh, but make sure they can build wherever they want with the public paying for all supporting infrastructure.
David Amos
Reply to Bob Smith
Yup
John Pokiok
New build apartments rent can be set to whatever they want just going forward can't be increased drastically. So yeah developers will keep on building.
David Amos
Reply to John Pokiok
Of course
Bobby Richards
NB also needs incentives for new housing builds. Other provinces are offering things like HST cuts and property tax deferrals.
MR Cain
Reply to Bobby Richards
With the number of active builds and new developers, there is no need of any incentives. Those in need will satisfy their profits. The government first has to negotiate on the financial aspects of amalgamation, review the property tax assessments, and a number of financial issues left over from the previous government; there has to continue to be some source of revenue.
David Amos
Reply to Bobby Richards
Yea Right
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