US & Canada

Government partially rescinds rent control

 

The government of Ontario has decided to keep new buildings out from the purview of rent control. In doing so, the Doug Ford-led Progressive Conservatives are partially rescinding one of the more controversial components of the Fair Housing Plan that was introduced in 2017 by the governing Ontario Liberal Party. Existing tenancies will continue to be regulated by rent control.

 

“Many people in Ontario face challenges in finding suitable, affordable rental accommodations, in part due to an extended period of under-building of rental units,” read an official release from the government. “Since 1992, rental unit construction has not matched household formation. Approximately 20 per cent of Ontario households live in purpose-built rental housing. In 2017, the level of new rental construction would accommodate only 10 per cent of new Ontario households. If construction of rental units had kept pace with underlying demand, construction would have started on an additional 6,100 units in 2017.”

 

Additionally, as part of its Housing Supply Action Plan, the PC government is putting an end to the Development Charges Rebate Program, which subsidized units earmarked for affordable housing.

 

While Ontario grapples with a 1.6% vacancy rate, the situation is even direr in Toronto where only 1% of total units aren’t occupied and the average rent on a one-bedroom condo is more than $2,000. Kathleen Wynne’s Liberal government imposed rent control on all units, capping annual increases at 2.5%.

 

Many key industry players have strongly criticized the Wynne government for its implementation of rent control, and in a statement Tim Hudak, CEO of the Ontario Real Estate Association and former leader of the Progressive Conservative Party of Ontario, welcomed the Ford’s government’s amendment.

 

“We’re pleased to see the Ford Government following our advice and ensuring the fading dream of home ownership will become a reality for more Ontario women, men and children. OREA looks forward to being a key advisor as the Government finalizes the Housing Supply Action Plan to provide solutions to make home ownership more affordable for Ontario families like speeding up approval times, intensifying along transportation corridors and building more missing middle housing.”
 

Written by The Realty Paper


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