Tenants losing homes across Lower Mainland as landlords find they can make more by selling
Jennifer Saltman
The Province
Ashley Cau found out that her landlords were planning to sell the Mission home where she lived with her nine-year-old daughter and grandmother less than 24 hours before it went on the market.
When it sold about 10 days later for above asking price and she realized she would have only two months to find somewhere else for her family to live, anxiety set in.
Competition for rentals in the area is fierce and she received no responses to the applications she sent out to prospective landlords, despite being a “good, boring” tenant with a steady job and good references.
The 31-year-old said she was lucky to find a place to rent, sight unseen, through the realtor who was selling the house she had to vacate. Her family moved in to their new rental almost two weeks ago.
“Had we not made the right connection, we’d have been homeless potentially right now,” she said. “We are not an exception by any means. So many families have had the same thing.”
Cau is one of countless renters from the North Shore to Chilliwack who say they are being evicted because their landlords want to take advantage of the hot housing market and cash in on their investments.
Local real estate boards confirm that it’s a seller’s market: Homes in Metro Vancouver continue to sell at “an unprecedented rate” and overall sales in the Fraser Valley are reaching “record-breaking numbers.”
The benchmark price for all residential properties in Metro Vancouver was $889,100 in May, a 29.7-percent increase over last year, according to statistics compiled by the Real Estate Board of Greater Vancouver. Residential sales are down from April, but up 17.6 per cent compared to last year.
The Fraser Valley Real Estate Board reports that the benchmark price for all residential properties in its coverage area was $727,591 in May, a 26-per-cent increase from last year, and sales are up 47.8 per cent from last May.
When it feels like you’re sitting on a potential gold mine, it’s natural to consider selling.
Charles Wiebe, a longtime realtor in the Fraser Valley and president of the FVREB, said rental homes are definitely part of the mix.
“Any time we have a stronger market we see that some landlords want to realize the profit in their investment, or they might be as well trying to catch up if their investment is costing them some money,” said Wiebe. Property taxes, insurance, maintenance and utilities are some costs that can cut into a landlord’s profits or cause them to lose money.
Joshua Gottlieb, an assistant professor of economics at the University of B.C., said there are all sorts of reasons why properties turn over. But he agreed that the fact that prices are high relative to rents is “a force that could be pushing people to not want to rent something out.”
Those who are in a position to sell are reaping the benefits, but the renters who are forced to find new accommodation are running into problems: low vacancy rates, intense competition and high prices.
Larry LaRose and his German shepherd moved into a three-bedroom Richmond condominium in November 2014. He had expected to be there for the long term, but one month after his year-long lease ran out, he received a one-line text from his landlord: “I’m selling the unit.”
“No phone call, no conversation, no empathy whatsoever,” LaRose said.
Andrew Sakamoto, executive director of the Tenant Resource & Advisory Centre, said that in general, the most common calls that come in to the tenant information line concern eviction, including two-month eviction notices for “landlord use of property.”
That covers a landlord or their close family moving in, renovations, demolition or a sale that results in the purchaser or their family moving in to the home.
“That type of eviction is quite common right now,” Sakamoto said.
He said the number of calls about two-month eviction notices has not increased significantly over the past six months compared to the six months before that, but there have been more calls about “bad faith” evictions: 87 between Dec. 1, 2015 and May 31, compared to 46 between June 1 and Nov. 30, 2015.
Examples of bad-faith evictions include issuing notices for simply putting a property up for sale; evicting before all conditions of the sale have been satisfied; evicting without written notice from the purchaser; not moving in “close” family as defined by law; lying about moving in family and re-renting to new tenants at a higher rate; or evicting for basic renovations that don’t require vacant possession.
He said renters are also reporting that it’s a challenge to find housing. It’s competitive and they have to make decisions on the spot.
“They’re absolutely having difficulties,” he said.
LaRose said the condo where he lived sold quickly, after multiple offers, for full asking price. He had a couple of months to find a new rental, but it was barely enough time.
“The suddenness of it and the lack of accommodation out there, added to the fact that I had a dog put me in a very, very difficult position,” he said.
One overseas landlord wanted one year of rent in advance. Viewings were crowded with prospective renters. Despite having a reasonable budget, LaRose had few options.
He now lives in a 65-year-old home in Ladner.
“I just felt like my back was against the wall,” he said. “It’s as though there’s nowhere to live in the Lower Mainland that’s reasonable from a renter’s point of view and I learned the hard way.”
The most recent statistics on vacancy rates are from the fall of 2015. According to the Canada Mortgage and Housing Corp., the overall rental vacancy rate in the Lower Mainland was 0.8 per cent.
Rental demand has outpaced the addition of new and renovated purpose-built rental units, and the demand is higher in centres outside of Vancouver, where all municipalities except the District of North Vancouver recorded lower overall vacancy rates compared to 2014.
The hot real-estate market in Metro Vancouver and the Fraser Valley has contributed to the low vacancy rate.
Kate Miotto lives in a basement suite in a single-family home in Surrey that has been listed for approximately two months. She said her landlords have been “awesome,” but she’s worried that she’ll be evicted after the house is sold in favour of a family member or because it will be torn down.
“This would not bother me as a rule, but with our rental market sitting at one per cent, finding a home I can afford that will allow me, my two cats and be within my cost range is just this side of impossible,” she said.
There are ways that could help renters who are caught up in hot housing markets. Cherie Enns, an associate professor in the University of the Fraser Valley’s Faculty of Geography, said Canada has no real housing strategy — though the Liberals have promised to invest in a National Housing Strategy — and there needs to be cooperation by all levels of government to come up with incentives to protect and build the country’s rental housing stock.
“There are things that can be done,” she said.
Gottlieb is part of a group of economists from UBC and Simon Fraser University who have recommended that the B.C. government create a Housing Affordability Fund that would tax activities that make housing less affordable for current B.C. residents.
For instance, Gottlieb said, if the fund was created, people would not want to buy a house, evict the current renters and leave it vacant because it wouldn’t make economic sense.
“There’s a lot of really strange things going on, and I think you have to think about it all as part of one unified market that’s responding to the very strange public policies in place which effectively subsidize these kinds of activities,” Gottlieb said.
“Our plan is designed to address all of that at once.”
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