A third of Canadians rent their homes, and they should have the same security as homeowners. But they don’t. Except in Prince Edward Island, landlords across Canada can raise the rent by any amount when a unit becomes vacant. It’s called “vacancy decontrol”—the rent isn’t controlled when a unit becomes vacant or the tenancy of the unit changes; rents are only controlled for existing tenants. That has two results.
One is that rents have soared, even in places like Ontario that have rent controls (not all provinces do). In 2023, for instance, two-bedroom apartments that got a new tenant rented for 31 per cent more than units occupied by the same tenant as the year before. Vacancy decontrol is the major factor behind the fact that, between 2011 and 2021, Canada lost 550,000 units—and the Hamilton area lost almost 16,000 units—of for-profit housing that rented for less than $750. Most of those units didn’t disappear, they simply became more expensive. Landlords can also apply for approval of rent increases above the annual rent control guideline amount in certain circumstances, pushing up rents even for existing tenants, making their homes less affordable.
The other, related result of vacancy decontrol is that it gives landlords a huge incentive to get rid of long-term tenants whose rents have been kept affordable by rent controls, even if the tenant always paid on time and behaved reasonably. Landlords can charge much more with a new tenant. Landlords sometimes offer money to tenants to move out, or illegally delay repairs or maintenance to “encourage” tenants to give up and leave. Landlords can also apply to evict tenants so that the landlord or their family can move into the unit or to do major renovations that the landlord claims can’t be done with the tenant present. The result is heightened stress—a well-known health threat—for tenants who fear they may not have the long-term, secure home they thought they had and that they deserve. And tenants in buildings that began renting after November 2018 have no rent control protection at all.
A recent report on best practices for tenant protections across Canada urged an end to vacancy decontrol along with measures to encourage more building of rental units, such as faster development approvals and “upzoning” to allow higher density housing. But it is highly unlikely that any for-profit developer will build units at the low levels needed—24,000 Hamilton households could not afford rents higher than $1,075 (2021 Census figures). That is why it is so important to use strong rent controls and other measures to protect the declining number of for-profit units that are still affordable or nearly so.