'Renovictions' Set To Rise In Canada In 2019, Rentals.ca Report Predicts

Jessica Chin
Most tenants aren't aware of their rights when a landlord says they'll be doing extensive renovations to their units.

Amid predictions of rising rents in some of Canada's already-red-hot markets, a new report shows there could be bad things to come even for those who don't plan on moving.

For those who've somehow managed to secure an affordable, stable place to live, a report from rentals.ca predicts "renovictions" will rise in 2019.

A "renoviction" is when a landlord tells a tenant they have to move out for major renovations, then re-lists the unit for a higher price once the original tenant has moved out.

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An expert cited in the report, which looked at real estate trends and 2019 predictions across the country, said landlords in cities like Toronto will be increasingly looking at upgrading their properties to attract luxury tenants.

Ben Myers, the president of residential real estate advisory firm Bullpen Research & Consulting Inc., told HuffPost Canada the renovictions issue is related to rent control, since landlords can't substantially increase rents otherwise.

"If someone has a tenant and they're paying, say $1,500 a month, and they could get $2,000 if that unit was vacated, then maybe they could get $2,300 if they put in a new floor or put in some new appliances or something," he said.

"You can see that there's financial motivation for them to do so."

'Not a lot of units available'

Myers said the reasons landlords have all the power is that "there's just not enough supply" of affordable units.

"If you want to leave them and go out and find another unit, there's just not a lot of units available," he said.

"And they know that if you leave, then they can reset the rent, and there's lots of people that want a unit... that may be willing to pay more than you do."

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Toronto city councillor and tenants advocate Josh Matlow told HuffPost Canada the laws around renovating a unit favour the property owner, not the tenant.

"Obviously the best way to protect oneself is to be informed and to know your rights," he said. "But I would argue that the onus shouldn't be on tenants having to protect themselves."

Matlow said most tenants aren't aware of their rights, which in Toronto include being able to return to the unit once the renovations are complete. But even if they are, it's a bit unrealistic to expect tenants to move back to a renovated property.

"So you've been renovicted, months and months and months have gone by, you've set up life in another apartment at a much higher cost, if you have kids, you might've already enrolled them in the local school," he said.

"You've set up your life, you've moved all your furniture, you've done all that."

"The reality is, most likely, it would be another upheaval to even consider coming back. So it's not realistic for a lot of people and a lot of families."

Governments at all levels will need to take real steps to solve this crisis or they will have disgruntled seniors, students, and renters with steep rent increases knocking on their doors. Matt Danison, Rentals.ca

Rentals.ca CEO Matt Danison said government officials, tenants' rights groups, and property owners need to meet together to solve the renoviction issue.

"Governments at all levels will need to take real steps to solve this crisis or they will have disgruntled seniors, students, and renters with steep rent increases knocking on their doors," Danison told HuffPost Canada in an email.

Danison agreed tenants should be helped when it comes to understanding their rights around being evicted. He also said they should be offered help to find another place to live, and be compensated in some capacity if they're asked to leave before their leases are up.

"Governments could also help the property owners by waiving certain fees and requirements to allow the owners to do repairs and renovations at lower costs," he said.

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Myers also cited an idea from Frank Clayton, a senior research fellow at Ryerson University's Centre for Urban Research and Land Development, which suggests adding incentives for property owners to add rental units within their own properties, such as basement apartments. This would " provide supply in neighbourhoods that don't have a lot of rental supply."

"Whenever you don't add enough new supply, well, then, people that would've been renting those [higher-end] units are now, well they take one step down, so they go and they rent the next one, and it just pushes everyone down the ladder," he said.

"Obviously the people that are hurt the most are the people at the bottom of the ladder. They become the ones that are homeless or couch surfing, or end up in a three-bedroom rental with six other people."

All governments should be working 'in tandem': Matlow

Matlow said he likes a proposal from Toronto's Federation of Metro Tenants' Association that rent control be attached to units themselves, which impacts landlords' motivations to renovict in the first place.

"And then the test is, if there really are renovations or genuine work that needs to be done to a unit, then that's costly for a landlord, and they may or may not do it, but at least if they do it, they'll do it because they really have to do it," he said.

"Right now, the added motivation for a landlord is to be able to hike the rent once they get rid of the tenant."

Matlow said he thinks all three levels of government — municipal, provincial, and federal — should be "working in tandem" on affordable housing, despite Ontario Premier Doug Ford rolling back rent control measures set by the previous government.

"I think that's something we need to fight for, no matter who the premier is."

CORRECTION: An earlier version of this story identified Frank Clayton as the head of Ryerson's City Building Institute. He is a Senior Research Fellow at Ryerson University's Centre for Urban Research and Land Development.