Losing it

Peter works from home in Vancouver and has a rental in Nanaimo. Makes sense if you want to own some dirt yet happen to be in a city where real estate is now the domain of the wealthy and the uber-indebted.

But being a LL ain’t easy. “I had a flood in the rental property,” he tells me. “Repairs have left me in the hole financially, so I brought forward my retirement plan to move to the place, as it will save me money versus Vancouver.”

Well, that didn’t work.

Pete filled out his RTB-32 form, “Two Month Notice to End Tenancy For Landlord’s Use of Property” and delivered it to his tenant. And so the troubles began.

“The tenant filed an action with the RTB. The RTB said I was lying. A phone call and a faceless bureaucrat with unknown qualifications. There’s no appeal process. They said I didn’t provide enough ‘evidence’ that I would in fact move in. How do you provide evidence of something that hasn’t happened yet? No matter, they are here to protect ‘working families’. My tenants make more than I do.”

BC’s Residential Tenancy Act is, like similar legislation in place across the nation now, written for the benefit of tenants and sets up unrelenting conflict with those who own the property and sometimes – as with Peter – effectively lose control of it. Form 32 tells the renter this:

Your landlord has to intend in good faith to accomplish the purpose for ending your tenancy. A claim of good faith requires honesty of intention with no ulterior motive. Good faith is a legal concept meaning a party is acting honestly when doing what they say they are going to do or are required to do under legislation or the tenancy agreement. It also means there is no intent to defraud, act dishonestly, or avoid obligations under the legislation or the tenancy agreement. If the good faith intent of the landlord is disputed by the tenant, the onus is on the landlord to establish that they truly intent to do what they say on the Notice and do not have another purpose or ulterior motive for ending the tenancy.

In short, Peter had to prove he was going to move in. But short of actually doing so, how does that happen? What proof is there of your personal plans? How could the rights of ownership be so quickly destroyed by the fact of occupancy?

But it gets worse for the landlord. There’s a penalty equal to a month’s rent to pay the tenant, but also an ongoing threat of legal action. “After you move out, if your landlord does not take steps toward the purpose for which this Notice was given within a reasonable period after the effective date of this Notice,” says the tenancy cops, “your landlord must compensate you an amount equal to 12 months’ rent payable under your current tenancy agreement.”

Well, BC has a dispute resolution process, as do other provinces. But it’s backlogged, despite more resources being devoted to the RTB three months ago. In Peter’s case he was told to forget even appealing, since the law clearly states the onus is on a landlord to prove intent to occupy, yet without being given the ability to do so. And the law says this, clearly: “You MUST NOT physically evict a tenant without a Writ of Possession, change the locks without an arbitrator’s order, or seize a tenant’s personal property without a Court Order.”

“Goddamit, you were right Garth. I just lost the right to live in my own home in Nanaimo,” he says. “I’ll likely sell now. I could slug it out, but what’s the point. It’s naked bias IMHO, and I’m a stickler for fairness, so I’m taking my ball home, to the S&P 500 where it can flourish unencumbered by the deft hand of Canadian populists.

“We have a rental supply crisis. Now I get why. If I might paraphrase Margaret Thatcher, ‘The problem with socialism is that eventually you run out of other people’s houses.’”

Without guys like Peter there would be far fewer rental units on the market. Vacancy rates would drop. Demand would crest supply. Rents would increase. In every corner of the land now, ownership rights are being reduced, diminished, overridden or simply abrogated. Cities adopting ‘vacant home’ taxes equal to triple the current property tax rate seek to force owners to become landlords. The federal government’s new UHT does the same nationally. Trudeau’s one-year flip tax effectively tells people when they can sell their own real estate, as does BC’s incoming two-year capital gains tax on owners. And once a tenant is in place, she can stop paying rent, not be evicted and expect at least a year of cost-free living before being forced out.

Mom-and-pop landlords have been vilified, taken advantage of by unethical renters and subjected to arbitrary and punitive legislation, while those owning a second home are now peppered with spec taxes, vacancy fees and disdain.

Yeah, we need more places to live. We also need less government. We have lost our way.

About the picture: “This gorgeous creature decided to hang around our YYC property recently,” writes Donnie. “He perched on our carport one afternoon and was laser focused on some wild rabbits that winter behind our garden shed. I’ve seen these on occasion but never close up and in broad daylight. He had no fear and was around for at least a couple of hours eventually cashing in on one of the rabbits. I was trying to sneak into my vehicle to get something and took the photo when he turned to give me the look. Thanks again for all the great financial advice you provide.”

To be in touch or send a picture of a beast, email to ‘[email protected]’.