Rent control policies have played a role in “limiting supply growth in purpose-built” rental housing, according to Doug Ford’s government.
In Thursday’s Fall Finance Statement, the Ontario government stated that “strong increases in the supply of condominiums, which until recently were not subject to rent-control guidelines, have helped keep the market better balanced.”
And to address the rental challenges, the province said it will reintroduce the rent control exemption that will apply to new rental units first occupied after today.
“This will help create market-based incentives for supply growth that will encourage an increase in housing supply to meet the needs of the people of Ontario,” states the provincial report.
But Toronto City Councillors are saying this is a bad move for Toronto.
In a release, Councillor Josh Matlow said that this announcement threatens the security of the city’s tenants, and that it would revive the loophole allowing landlords to make unlimited increases to the rent of newly-built apartment units.
Last year, the Liberal government worked to close the loophole after many landlords took advantage of tenants in Toronto.
“Landlords and Doug Ford must be the only people in Toronto that think rents aren’t high enough already,” said Matlow, chair of the Tenant Issues Committee.
“Tenants deserve to have the security of knowing they won’t be evicted from their homes because they can’t afford an overnight doubling in their rent.
“Doug Ford’s decision to remove rent control from new buildings will make Toronto even less affordable. It removes tenants’ rights and drives young people out of our city. This affects people’s ability to make ends meet. Ford’s doing this for some landlords, not ‘for the people.’”
Former Mayoral candidate Jennifer Keesmaat said that Toronto has an affordable housing crisis.
“Even with rent controls on new units, we’ve seen a surge in purpose built rental, which is critical to addressing our housing crisis,” she said. “Today at the behest of a small group of developers who stand to benefit, those controls were rolled back.”
Matlow said that the change to the Residential Tenancies Act is not only unfair to already overburdened tenants, but “the move is also unnecessary.”
He added that claims that returning the loophole will increase apartment supply, eventually leading to lower rents, are not supported by evidence.
Matlow refers to Urbanation, a leading condo and rental market analysis firm, who state that the rental construction rate is the highest seen in at least 30 years with the inventory of rentals underway now higher than all units in apartments built since 2005 (10,871).
Councillor Kristyn Wong-Tam calls Ford’s move “unacceptable.”
“Their regressive policies including removal of rent control is going to make Toronto and Ontario less affordable and livable,” she said. “That’s unacceptable. We must fight this.”