Housing minister to close fixed-term lease loophole

VANCOUVER (NEWS 1130) – Housing Minister Rich Coleman says he is looking at closing a loophole in a type of lease which allows landlords to increase rents way beyond the allowable limit.

The use of fixed-term leases with a vacate clause is on the rise. The contract sets the rental rate for the duration of the lease. Once the lease is over, if the tenant wants to stay, the landlord can reset the rent.

Andrew Sakamoto with the Tenant Resource Advisory Centre says the fact landlords use them to set higher rents after the lease is over is something they’re well-aware of.

“It’s the use of these vacate clauses that allow landlords to make the argument that if the tenant opts to stay, they have to draw up a brand new contract for a second year. The inclusion of those vacate clauses needs to be banned.”

Sakamoto says they don’t have numbers to demonstrate how many people get caught up in the leases.

“This definitely is a practice that’s been on the rise. Even in my personal life, a number of friends have come to me to complain to me about this practice.”

The allowable rent increase limit is set every year, based on inflation plus two per cent.

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