This is cautionary advice for anyone who may be considering renting a suite in their home.
It is imperative that you ensure when you start the initial rental that the negotiated rate reflects the market at that time.
It is also essential that you increase the rent by the allowable amount each year.
This amount is generally very low because it does not reflect the actual prices of new rentals coming to market, but the province of B.C. “basket of goods” cost-of- living increase.
As an example, the last annual increase was 2.6 per cent as of January 2020, but this was rescinded in March 2020 and any monies paid to be returned, until Dec. 31, 2021 due to COVID-19.
The crunch comes when you decide to sell your home as low rental income has a detrimental effect on the potential selling price.
When an agreed selling price has been established, the new owner may request that the current owner serve the tenant with an order to end tenancy in two months stating that the new owner wishes the use of the rental suite for the occupancy by a close family member. (This request cannot be a condition in the sale/purchase of the dwelling). Parents and children of the owner and/or spouse are the only ones designated as close family members.
The owner is required to provide the tenant with one month of free rent.
If the tenant advises the Rental Tenancy Branch that the owner is not housing a close family member or the renovation of the suite is not proceeding in a timely manner the Branch may declare that a penalty equal to 12 months rent be imposed on the owner, payable to the tenant.
This may well be $18,000 to $24,000, depending on the size of the suite, and the order to pay would come from the Supreme Court of British Columbia.
Aside from the above, if a tenant refuses to vacate after an order to do so has been issued by the Residential Tenancy Branch, the owner must go to the Supreme Court of BC and request a Writ of Possession.
This may result in a very expensive procedure if the tenants refuse to leave and take their possessions with them.
The owner would then have to hire a court- approved bailiff, and pay to have the tenant’s possessions packed and stored in a secure facility for a designated period of time. If the tenant does not retrieve their possessions then the owner must have notices placed in government publications and local press as to the intention to sell the tenant’s possessions if the tenant does not claim them.
At this point the owner has paid all the costs detailed above and now must try and collect from the tenant.
Lots of luck!
I believe that these Draconian rules were put in place to control landlords of multiple rental units.
I believe there should be a separate set of regulations for landlords that rent a suite in their principal residence.
There should be an obligatory two months notice to vacate when an owner wishes to sell their home with no caveat for the tenant to prevent this from happening.
This notice should also apply if the owner wishes to renovate for the owners use or for rental. The existing tenant should be given the right of first refusal at a negotiated rent that reflects the upgrade to the unit.
Annual allowable increases should reflect the actual prices of rentals coming to market, not the province’s “basket of goods” cost-of- living increase.
When a current rental ends, whether it is voluntary or by an order of the Residential Tenancy Branch, the tenant must remove their possessions or face the sale of same on a where is, as is basis.
The revenue obtained, less any expenses born by the owner, would be payable to the tenant.
John Richmond // Formerly of Whistler, now in Sechelt
(This letter has been edited to update information.)
