Premier David Eby is following through on a promise he made while campaigning for his current position to provide a $500 million fund for rental protection.
Announced Thursday (Jan. 12), the Rental Protection Fund will be divvied out to non-profits through grants to allow them to purchase and protect rental properties in B.C.
Eby said the goal is to safeguard older properties from speculators who can evict tenants and drive up rental prices.
Across Canada, private equity firms, pension funds and real estate investment trusts (REITs) are increasingly gobbling up property as an investment strategy, according to a September report from the Office of the Federal Housing Advocate. The report estimates that about one-third of seniors’ housing and 20 to 30 per cent of purpose-built rental housing has been “financialized.” The phenomenon has the greatest impact on disadvantaged groups.
What this means on the ground is that places like B.C. can be losing affordable housing just as quickly as it’s being built. A December BC Housing report shows the highest number of rental units – 14,546 – on record were registered in 2022. That’s a 10 per cent increase from 2021. Yet, renters continue to be evicted and continue to face unrealistic prices.
Eby said shifting more rental properties under the control of non-profits is one way to change things. He expects the $500 million to protect thousands of units.
Representatives from the BC Non-Profit Housing Association, Co-operative Housing Federation BC and the Aboriginal Housing Management Association all applauded the move Thursday.
“If you want to protect a scarce and valuable asset, put it somewhere safe. The only reason we get up in the morning is to provide safe, secure homes,” Thom Armstrong, CEO of Co-operative Housing Federation BC, said.
Still, the announcement was missing one aspect that Eby said will take more time to consider and possibly implement – a law ensuring first right of refusal to give non-profits first dibs on purchases. Such a law would protect non-profits from ending up in bidding wars against speculators.
Eby said Thursday he’s counting on rental property owners to choose to sell to non profits in those instances. He said non-profits will also have the option of seeking funding from private sources to augment grants from the province and make their bids more competitive. Once non-profits own a property, they may be able to leverage equity from it for future purchases as well, Eby added.
The $500 million will be dolled out within this fiscal year. Eby said depending on how the resulting purchases go, his government will consider a similar fund in future years as well.