In yesterday’s Fall Economic Statement, Ontario Treasurer Vic Fedeli outlined that new housing units and previously unoccupied rental units would be exempt from the Wynne government’s rent control reforms.
Caption: Ontario Finance Minister Vic Fedeli
The Fall Economic Statement is an outline of fiscal and policy changes and economic news a government seeks to outline before its budget, where overall fiscal policies and most spending plans are explained.
The previous government under Premier Wynne implemented its ‘rent control’ reforms shortly before this year’s election which limited rent increases to 1.8% for 2018 and broadened tenant rights at the expense of landlords. Tenants and poverty groups applauded the reforms, while landlords complained that the changes would make them more selective of tenants. Developers stated that rent control would redirect their attention to build units for sale, not rent, further augmenting southern Ontario’s housing and rental supply problem.
With vacancies at absolute rock bottom record lows, the competition for favourable rental housing space in downtown Toronto is relentless. Builders and renters are applauding the Ford Government’s dilution of rent control, saying it will result in more supply, but over the long term and not immediately. Poverty groups and tenant advocates say the move will cause rental costs to skyrocket and will result in evictions. While it is agreeable to have strong protections for tenants in place, rent control has been proven to restrict supply and reduce the quality of housing stock in most of the jurisdictions where it is implemented.