Since 2001, WinnipegREALTORS® has supported the Professional Property Managers Association (PPMA) efforts to have the provincial government amend rent control legislation to allow voluntary vacated units to be removed from rent control guidelines.
Meetings with Finance Minister Greg Selinger, also the minister responsible for the Residential Tenancies Act, were held as WinnipegREALTORS® adopted its formal policy position on rent controls. At the time, Selinger indicated that changes in the guidelines were under consideration.
In fact, the provincial government has made a move in this direction with the official approval of a rehabilitation scheme on November 1, 2007. The scheme, outlined below, was confirmed at a recent meeting WinnipegREALTORS® had with Laura Gowerluk, the acting director of the Residential Tenancies Branch. Not only is there now an exemption from existing rent control guidelines based on this new rehabilitation scheme for single units, she said, but there are exemptions for up to five years after the rehabilitation of an existing complex and for 20 years for any new residential construction.
Since 2005, when the exemption for new construction went from five to 15 years and then 20 years, she said 2,500 units have been built. This is a significant increase over the previous 10 years. Gowerluk indicated that $160 million has been reinvested in existing housing stock. An encouraging sign, she added, especially given the strong demand for housing in Manitoba.
What was impressed upon the acting director is that WinnipegREALTORS® is keenly aware of the tight rental situation in Manitoba as number of members are directly involved in the rental market. The members of WinnipegREALTORS® commented on issues such as the major price increases in rental single-home properties in the last few years that may prompt landlords to sell their properties. As a result, low-income tenants that will be hard pressed to find alternative rental accommodations in an extremely tight market.
Manitoba has become successful in attracting an increasing number of new immigrants as well as stemming the tide of outmigration. For the first time, more people are coming back to Manitoba from Alberta than heading west.
The meeting concluded with Gowerluk expressing appreciation that WinnipegREALTORS® will become more active on housing issues it deems critical to Winnipeg’s future success. The rental market is certainly a critical topic that needs attention.
Unit-by-unit rehabilitation scheme
As of November 1, 2007, landlords were able to apply for the approval of a rehabilitation scheme for a single unit. The program applies to units that have been voluntarily vacated and thus will be exempt from rent regulation for up to two years.
When reviewing an application, the branch will consider the general condition of the complex as well as that of the unit. To qualify for approval, the rehabilitation must involve major improvements that substantially increase the quality of the unit. It must include replacement of at least three of the following:
• Kitchen cabinets or kitchen countertops and sink
• Bathroom fixtures
• Electrical wiring
• Interior doors
• Windows or patio doors
• Any other improvement the branch accepts
If the branch approves the application, the unit will be exempt from rent regulation for a specified period. The length of the exemption depends on the cost of the rehabilitation. The branch uses the following criteria to determine how long the unit will be exempt:
• Rehabilitation costs from $3,500 to $4,999.99 — one-year exemption.
• $5,000 or more — two-year exemption.
To apply for approval of a single unit rehabilitation, the landlord must complete the Application for Approval of Rehabilitation Scheme for Specified Unit. The landlord then sends the application to the branch along with the $100 processing fee. The application must be received by the branch prior to 20 per cent of the proposed work being completed.
A landlord may apply for up to 10 per cent of the units in a complex each calendar year. Under this program, the Branch will exempt up to 3,000 rental units from rent regulation each calendar year. The total number of units exempt under this program cannot exceed 5,500 at any time.