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BC landlord rejects request to increase SRO rent by over 50%

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Tenants reported that they also performed unpaid work.

A landlord in British Columbia's request to increase rents for his tenants in a single-room occupancy building by more than 50 percent was denied.

The landlord filed a dispute resolution application with the BC Residential Tenancy Branch (RTB) to “enforce a rent increase of 49.5 percent, in addition to the 3.5 percent annual rent increase permitted by the bylaw.”

British Columbia law allows landlords to increase rent above the allowable amount in certain situations, such as an extraordinary increase in operating costs.

The landlord in that dispute said he was having trouble calculating operating costs for the unspecified SRO building, which is owned by a nonprofit corporation. The rent no longer covers the cost of utilities, taxes, heating, ventilation and mechanical problems, the landlord claimed.

Although the landlord has not made any changes to the services offered in the building, costs have increased for maintenance workers to address pest control issues, former tenants leaving their apartments in poor condition and removing excess trash from the property, dispute documents show.

The RTB asked the landlord's agent to explain how the requested 49.5 percent increase was calculated. The agent explained that it was “achieved through accounting and an attempt to predict future cost increases.”

Tenants claim the building was poorly managed

The tenants who attended the RTB hearing pay monthly rent between $425 and $570.

The tenants opposed the landlord's request, citing that “expenses are increasing due to poor management and the weekend caretaker is paid for eight hours” and only stays for a few minutes. They also said allowable rent increases within the annual amount “would be acceptable and affordable,” but the contested change was unaffordable.

The tenants also claimed that units in the building had at times been vacant for months, “while other residents were allowed to stay for up to ten months without paying rent.”

Other tenants said they had done unpaid work “helping to clean up the alley and remove rubbish left there by tenants moving out”.

The landlord has not increased rent in recent years, but four new tenants are each paying $650 a month.

The RTB ruled that the landlord had not met the requirements of Rule 37D for an additional rent increase for expenses.

While the landlord claimed that the costs of property taxes, water, sewer, gas and janitorial services had increased extraordinarily, the RTB found that “the only costs that could reasonably be described as having even remotely 'extraordinary' increases were the costs of water, sewer and janitorial services.”

In the three years prior to the application, water, sewer and janitorial costs had increased by $22,925.00 and the total annual rent paid by tenants was $159,960.00. A rent increase of 14.33% would cover the increase in these costs, the RTB found.

The landlord's operating expenses also decreased by $32,905.00 from 2021 to 2022 and the landlord has failed to enforce rent increases permitted by the ordinance in recent years.

The landlord’s application was subsequently rejected in February 2024.