LandlordBC’s Response to B.C. Government’s Proposed Plan for Renters and Landlords
FOR IMMEDIATE RELEASE
VANCOUVER, BC (March 25, 2020) – These are challenging times and LandlordBC continues its commitment to advocate on behalf of owners and managers of rental housing to all levels of government while doing our best to help our sector navigate the myriad of issues that we are facing today. At the same time, we have been very clear to our members and the broader sector that it is essential that everyone understands that what we are experiencing today is unprecedented and that collectively we have a responsibility to exhibit compassion and work with our residents to make all reasonable efforts to ensure no one impacted by COVID-19 is unhoused.
We are and will continue to be a collaborative organization focused on solutions that benefit both renters and landlords. We’ve long advocated for robust renter supports and passionately advocate for the construction of badly needed new purpose-built rental housing. In all our discussions and communication with the B.C. Government during this crisis, we have however been very clear that it is government’s role to put relief programs in place, funded broadly by taxpayers, versus by individual business sectors. Furthermore, in the case of the rental housing sector, we’ve stressed that the majority of landlords in BC are not “businesses” but rather individuals in the form of small mom and pop landlords. We will have more to say about today’s announcement from the B.C. Government but wish to offer these initial comments.
On Monday, Premier Horgan and Finance Minister James of the B.C. government announced a $5-billion economic action plan to help families and businesses struggling financially through the COVID-19 crisis, including one-time payments of $1,000 to people who are now out of work. This package was unanimously approved by all parties and we applaud them for their collaboration during these difficult times.
Today the B.C. government announced a package that is intended to support renters and landlords.
We are pleased to see that the Government will be providing renters impacted by the COVID-19 crisis with financial support and that these monies will flow directly to landlords. We are also pleased that the Government was very clear that renters have a responsibility to pay their rent and it is the Government’s expectation that all renters, including those renters impacted by the COVID-19 crisis, who have the capacity to pay rent via savings, assistance from families, etc, do the responsible thing and pay their rent.
We are more concerned about the complete moratorium on evictions which includes new evictions but also evictions that may already be under way and the consequences this represents. We appreciate that the Government is faced with a significant dilemma, nevertheless, a moratorium of this nature has the potential for huge unintended repercussions for individual landlords and the industry as a whole. This is further exacerbated by the proposed rent increase freeze, which we will require much more information about before we are prepared to make additional comments.
The Premier referred to banks and financial institutions needing to be sensitive to the challenges and financial uncertainty landlords will be facing in these challenging times. The Premier is correct, but we remain very concerned about the response our sector will experience from lenders. As we’ve said before, we’ve heard advocates speak about landlords getting mortgage deferrals so they can “pass those savings onto renters”. Well, a mortgage deferral by a bank does not constitute any “savings” to the landlord. There’s no mortgage forgiveness (if you qualify for the deferral in the first place and many landlords will not), it has to be paid back with compound interest on the deferred amount. In other words, interest upon interest. And know that the bank absolutely secures any deferral it offers by way of their mortgage with the landlord (the deferred amount is added to the mortgage principal), whereas the landlord doesn’t have any security for deferred rent from a renter.
So while we will require more time to study the B.C. Government’s proposed plan for renters and landlords announced today, we reiterate our commitment as an organization and an industry to work collaboratively and constructively to find solutions reflective of the unprecedented times we face.
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Media Contact:
David Hutniak
CEO
LandlordBC
Email: [email protected]
Telephone: 604-644-6838