Moncton tenants dodge 94% rent increase shortly after N.B. rent cap expires
Landlord still seeking increase of 55 per cent
If implemented, it would have been a 94 per cent increase.
"My partner and I looked at it and we were like, this can't be legal," said Wallace.
"We were shocked."
This week Wallace's landlord, Moncton developer Stephen Gallant, rescinded the increase and in an interview called it poor judgment on his part. He still plans to raise rent on Wallace's unit to $1,395, a 55 per cent increase.
Stephen Gallant issued rent-increase notices to tenants of his mixed-use Robinson Street building, including one at 94 per cent. This week he rescinded the notices and apologized, but is still asking for double-digit increases in most cases. (Michel Nogue/Radio-Canada)
He and Wallace disagree on whether it is a one or two-bedroom unit, but in Gallant's view a 94 per cent increase would fairly bring Wallace's rent up to market rates in Moncton. Still, he said he accepts that 94 per cent was too much to impose at once.
"In business you don't always make the right decision," said Gallant.
The notice to Wallace, and notices for differing amounts to other tenants in his downtown Moncton building that he also rescinded, signal the start of what could be a tumultuous year for renters in the province.
It's cutthroat out there
- Leigh Johnson, Moncton tenant
On Jan. 1, New Brunswick ended a one-year hard cap of 3.8 per cent on rent increases, implemented to protect tenants from excessive price spikes.
Instead, the province is counting on the marketplace, responsible landlords, new rules and more powers for government tenancy officers to help keep rent increases fair.
But with inflation high and vacancy rates low, what landlords will be asking for, and what the province will accept as being fair if tenants object, is not entirely clear.
Leigh Johnson is Wallace's neighbour in the same building and is facing that dilemma. She initially received a rent increase notice from Gallant of 41 per cent — from $800 per month to $1,125.
Leigh Johnson, left, and her sister Bailey, each rent an apartment in the same Robinson Street building. They were both looking to move after getting 40 per cent rent-increase notices, but are rethinking that after the increases were cut in half. (Vanessa Blanch/CBC)
"It really shook me," said Johnson, who works in the service industry.
"We're just going to keep seeing prices go up and up, and that to me is very scary. This is just another example, like 'oh my gosh am I going to be homeless next month.'"
Johnson immediately contacted the province's Residential Tenancies Tribunal to object. She said no one got back to her on that, but on Tuesday, Gallant retracted the $325 rent increase on his own, apologized in person for issuing it and replaced it with a rent hike of $175 to take effect next summer.
Johnson is happy with the improvement, but it's still a 22 per cent increase and she is not entirely sure how to react to that.
New rules allow provincial tenancy officers the discretion to require a landlord to spread an increase over two years if it is double the rate of inflation and over three years if it is triple inflation or more.
Jill Green, the minister responsible for housing, announced in November New Brunswick was ending its one-year experiment with hard rent-cap protections for tenants. Instead the province adopted new rules about how and when increases can occur and how tenants can object. (Shane Fowler/CBC News)
But there can be exceptions. If a new, higher rent will still be lower than what other similar apartments in the area rent for, a large increase can be allowed to proceed all at once.
A brief look at Moncton's current rental market convinced Johnson a 22 per cent increase may still leave her paying less than others in that city. That, and the non-response she got from her initial complaint to the tenancies tribunal has her considering accepting the new amount without a fight.
"It's cutthroat out there," Johnson says about renting in Moncton.
Melanie Wallace has a similar decision to make about whether to accept or dispute her 53 per cent rent increase. She said being a renter has become "scary and uncertain" in the last couple of years, especially for those with limited incomes.
Tribunal 'overworked' says advocate
Jael Duarte is a lawyer with the New Brunswick Coalition for Tenants Rights.
She said she isn't surprised by the size of the rent increases being faced by Wallace and Johnson and fears a wave of others like them in the wake of the rent cap ending.
And she has doubts the tenancies tribunal has the resources required to properly police a large number.
"They are overworked at the tribunal," said Duarte.
New Brunswick Coalition for Tenants Rights lawyer Jael Duarte expects a large number of tenants to be hit with major rent hikes in 2023. (N.B. Tenants Rights Coalition)
"They are already responding slower than before."
Figures do show applications to the Residential Tenancies Tribunal for help with a rent increase jumped to 44 in December. That's up 29 per cent from November when the end of the rent cap was first announced.
But Duarte expects that number will grow.
Under new rules, landlords must give six months' notice of a rent increase and tenants have 60 days to ask the tenancies tribunal for a review, both changes the province says will help tenants in the absence of the rent cap.
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N.B. plan on housing crisis to come by June, while opponents say action needed now
'It's a big body of work. And we're getting to work,' says Bruce Fitch
Bruce Fitch says his government has been reviewing the 50-page report that civil servants recently released, which lays out challenges renters are currently facing, along with calling for "better protections against unreasonable rent increases."
"It was 90 days it's been given to government, and I've been tasked with the distinction of pulling the various departments that are impacted," said Fitch, speaking as part of the CBC Political Panel.
"It's a big body of work. And we're getting to work, and I hope to respond within the end of the month, by the end of the month on the go-forward from the government."
Speaking to reporters following the report's release, Executive Council clerk Cheryl Hansen said despite the report calling for better protection for tenants against unreasonable rent increases, it's not calling for "across the board" rent controls.
Speaking on the panel, Shediac Bay-Dieppe Liberal MLA Robert Gauvin criticized the report as not doing anything more than offering an overview of a problem that's already known to exist.
He said his party already has a solution, and it plans to introduce a bill in the legislature that would see the amount of any rent increase not exceed the percentage change in the consumer price index in New Brunswick.
Robert Gauvin, Liberal MLA for Shediac Bay-Dieppe, says he'd like to see rent control that would tie rent increases to no more than the percentage change in the consumer price index. (Ed Hunter/CBC)
"And if [landlords] want to raise the price after that, they can go and plead their case in that bill that we have," he said.
"And in this, we aren't reinventing the wheel. Here is something that works well in other provinces and should work well here in New Brunswick."
Green Leader David Coon also said the government needs to act immediately based on the findings of the report, adding he plans to have a second reading of his bill in the legislature next week, which calls for rent control.
Green Party leader David Coon said he'd like to see rent control that prevents landlords from imposing substantial hikes in tenants' rents without justification. (Jacques Poitras/CBC News file photo)
He said his bill would ensure landlords can't raise rents more than once in a year, and "ensure that unacceptable rent increases do not occur by providing for a mechanism to control those rents while enabling landlords to apply for increases beyond that, if they can be justified to the residential tenancy folks."
Target the double tax, says Austin
Also speaking on the panel, People's Alliance Leader Kris Austin said he's against rent control, as he fears it could discourage developers from creating more housing.
"You've already got developers that are refusing to build affordable housing in New Brunswick because they can't make enough profit because of the double tax. So you add rent controls onto that, they're even less likely to build," he said.
People’s Alliance Leader Kris Austin says he's against rent control, but would like to see the province eliminate the so-called 'double tax.' (CBC News)
Instead, he said he wants the government to eliminate the so-called "double tax," which levies a provincial tax on top of the municipal tax for buildings like rental properties and cottages.
"Developers aren't paying the double tax and landlords [aren't] paying the double tax. Tenants are paying for it because they're passing it on.
"But yet, in a 50-page review that was put forward here by government, the double tax got three lines out of a 50-page review. And you know, to me, it's just disingenuous because that is the real crux of the issue."
With files from CBC's Political Panel
" assessed value of the building." ....
Cardy says other ministers frustrated with Higgs should quit, too
Former minister to sit as Independent after clash with premier, expulsion from caucus
Former education minister Dominic Cardy says he hopes other frustrated members of the Progressive Conservative cabinet will consider quitting like he did.
Cardy said he was not the only minister who had a problem with Premier Blaine Higgs's leadership style.
"I know that this is certainly the experience of other folks in cabinet, in other departments," Cardy said on Information Morning Fredericton.
"There is simply pressure based on what the premier is feeling on that day, standing in the way of getting what he wants done in government."
In a subsequent interview Friday, Cardy said he hopes those ministers will think about how to register their objections.
"All you really have in politics in the end is you've won a seat, you're there, you get to make decisions. You have to decide where your values and principles align with the direction that you've been given," he said.
"If you feel you're being pushed over the lines, I hope that others would take the steps that they think are appropriate."
Cardy made the comments Friday morning before the PC caucus met and voted to expel him. That means he'll now sit as an independent member of the legislature.
"As a group we found your conduct and your actions most notably over the last few days to be inexcusable," Higgs said in a letter to Cardy released to the news media.
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Cardy resigned Thursday with a scathing two-page letter to Higgs that accused him of meddling in decisions, ignoring data and evidence, and impulsive decision-making he compared to "a wrecking ball."
He said the premier replaced elected health authority boards with appointed trustees in July without consulting his cabinet or caucus.
Higgs has taken the same approach in deciding to rush the implementation of a recommendation to eliminate French immersion by next September, Cardy said.
"You have a premier who often talks about intentionally creating chaos as a way to catalyze change. That may work in some contexts in the private sector but it can be pretty disastrous in the public sector."
Cardy says some cabinet members agree with him. (Jacques Poitras/CBC)
Higgs acknowledged Thursday he was looking for quick action on those issues.
He told reporters that he informed Cardy in a meeting he would be shuffling him out of cabinet and that Cardy already had a resignation letter drafted.
But Cardy disputed that version of events Friday morning, saying he took the initiative to resign in his meeting with the premier.
"I said 'I think it's time for us to part ways,'" Cardy said.
Higgs's letter to Cardy expelling him from the PC caucus called the letter "vindictive and misleading."
The former minister, a former provincial NDP leader first elected as a Progressive Conservative MLA in 2018, confirmed Higgs's assertion that he has threatened to resign from cabinet several times before.
Each time, Cardy said, he managed to convince the premier and his cabinet colleagues "to move in my direction" enough to stay in cabinet.
He said Friday before the caucus vote to expel him that he had no plans to resign his seat and would remain an MLA and vote in a way consistent with the party's philosophy.
Higgs said Thursday he will ask the PC caucus at the legislature to expel Cardy, which would force him to sit as an independent MLA.
Cardy said he wants the chance to make his case for staying to the caucus and hopes any vote on expelling him will be by secret ballot.
"It is usually not the premier's prerogative to make those calls," he said.
Liberal Leader Susan Holt says there's no room for Cardy in her party. (Jacques Poitras/CBC)
Expelled or not, he said he has no plans to resign his seat before the next election and would support the Higgs government's legislation that conforms to its election commitments.
"I was elected as a PC MLA for Fredericton West-Hanwell and I'm going to continue to do my job based on that," Cardy said.
"I will continue to sit and represent the values and the platform that I was elected to implement and vote accordingly. I've got no plans on going anywhere."
He said he would not run for the PC leadership if Higgs retires and has no interest in runningfor the federal Conservatives.
He also ruled out joining the Liberal or Green caucuses, saying he opposes floor-crossing on principle.
Liberal Leader Susan Holt tweeted Friday morning that her party wouldn't welcome Cardy even if he were interested.
"We discussed it as a caucus and agreed it was not something we will pursue," she said.
David Coon, Green Party leader, says if sitting MLAs want to join the Greens, they would have to resign and run as Green candidates in a byelection. (Mrinali Anchan/CBC)
And Green Party Leader David Coon said the only way a sitting MLA could join the Greens would be to resign and run as a Green candidate in a byelection.
Whatever his status in the legislature, Cardy said now that he is free of the requirement for cabinet solidarity, he'll continue to raise his concerns about Higgs.
"Clearly there's a much broader world outside the four walls of that building, and as an elected official, it's my job to talk about public policy and issues and my perspective on them," he said.
"MLAs are elected to use their judgment to analyze the issues of the day and I'm going to continue to do that in my new role the same way I did in my old role."
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