Annual Rent Increase Limit
Annually in September the BC Provincial Government identifies an allowable rate that rents can be increased for the following year. They have announced the maximum allowable rent increase rate for 2026 will be 2.3% which is down from the 2025 rate of 3%.
Why do they announce this is September?. There is a requirement for landlords to provide three months notice to inscrease rent and the notice must be sent prior to the start of the month. By doing this in September it means any increase sent in September is effective in January and would be at the new rate. In this case the new rate is lower than the 2025 rate.
At this time we are not recommending any of our clients raise the rent. The current market has more supply than demand and is pusing rents downward rapidly. A rent increase often causes tenants to consider moving.
During covid we experienced the “work from home” effect of people moving further away from their work location and out of the downtown part of the city paying higher rents than the local market. We are seeing the rents revert back to the more pre covid traditional rates of the further away from the city the lower the rents. This is giving tenants the opportunity to move from their current location to other parts of the city and save significantly on their rent.
With the excessive supply of products we are also experiencing longer times to locate a suitable tenant. Almost all potential renters viewing properties in today’s market are in a tenancy which means they must give one month notice to vacate their property. If they are applying in September then they are looking to rent for November 1st. We are finding it is taking three to six months at the moment to find the right tenants. For these reasons we are not recommending our clients increase the rent as this could create a vacant situation at your property for multiple months.
We are unsure how long ths market will continue though we don’t see this changing for at least one or maybe two more years.
There are lots of construction products nearing completion and in various stages of the development process. Some of these are full rental buildings, most are condos that owners may have sold upon completion except the sales market has slowed tremendously and the owners are looking to rent the unit instead of selling which is adding more product to the market.
We are not seeing the government showing any willingness to change or revert some of the changes they implemented in the past few years to help slow the downturn in sales and rental rates. The federal government is developing plans to build more homes across the country to help alleviate the cost of housing which may also have an effect on the renta rates.
We won’t see a change in the downward trend of rents until there is an increase in housing sales.
Need help managing your rental properties. Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com
