Realtors put forward solutions to acute shortage of rental units

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This article was published 02/03/2011 (5327 days ago), so information in it may no longer be current.

LOCAL Realtors say rent controls are choking off new construction and contributing to an acute shortage of rental units in Manitoba, and they’re calling for a softening of controls and new subsidies and tax credits to address the problem.

“Manitoba needs to move away from the current rent control regime if it wants to improve vacancy rates and better prepare for future immigrant-driven growth,” WinnipegREALTORS said in a 36-page discussion paper Tuesday.

The paper said there have been numerous studies done in other jurisdictions that show rent controls discourage construction of rental units.

And while it would like to see controls abolished, a short-term compromise would be to adopt a softer form of controls that temporarily exempt newly vacated rental units to allow market rents to climb to more realistic levels. That would reduce the gap between market rates and the price developers have to charge for newly constructed units.

They said Ontario went that route in the late 1990s and saw a surge in new rental-unit construction and an improvement in vacancy rates.

But it sounds like the association has its work cut out to persuade the government to adopt a similar approach.

Family Services and Consumer Affairs Minister Gord Mackintosh said Tuesday a recent report commissioned by the province contradicts many of the points cited in the Realtors’ paper.

“We’ve just received an outside independent expert analysis that showed rent regulation was not the culprit for low vacancy rates,” he said.

Mackintosh said there are more apartments being built now in the province than at any time since Manitoba started keeping such records in the 1980s. And in Saskatchewan, where there are no rent controls, the vacancy rate is about as low as it is in Manitoba.

Mel Boisvert, chair of the WR task force that prepared the discussion paper, said he’s aware of the differing opinions. But that doesn’t mean there isn’t room for a compromise solution.

“There is no silver bullet and there will be no overnight success here. It’s going to take awhile — months, maybe even years. But we have a problem here and we have to start somewhere.”

He said the association hopes to meet with provincial and city officials within weeks to begin working on a solution. And if progress is made, they’ll seek input from other industry players.

“Hopefully some of the solutions we put forward in the discussion paper will be considered,” he said. “Doing more of the same is not an option.”

Two other key recommendations are the introduction of a provincial portable shelter allowance to help low-income earners cope with rising rental rates and new property tax credits to encourage investors to built more moderate to low-income rental units.

Boisvert said the province hasn’t said where it stands on those issues.

Manitoba Housing and Community Development Minister Kerri Irvin-Ross said the province is already working to set up a broad working group to discuss the rental housing shortage. It will include landlords, housing advocates, tenants and other public and private sector players.

murray.mcneill@freepress.mb.ca larry.kusch@freepress.mb.ca