On December 11, 2017 significant changes the Residential Tenancy Act of British Columbia were introduced with respect to fixed term residential tenancies. In this article we will discuss some of the changes to fixed term tenancies in British Columbia.
Residential tenancies in British Columbia are either categorized as “month to month” or “fixed term”. Previously, the greatest difference between these two categories of tenancies was how they came to an end causing the tenant to vacate the leased property.
- Month to month tenancies would end upon one party giving notice to the other in accordance with the provisions of the Residential Tenancy Act and the related regulations. For example, a tenant could end a month to month tenancy by giving the landlord one full month’s notice of the tenant’s intention to end the tenancy, and a landlord could end a month to month tenancy by giving the tenant notice for non-payment of rent, cause, or landlord’s use of property.
- Fixed term tenancies would automatically require the tenant to move out upon the expiry of the fixed term if the “vacate” box was ticked and the agreement was initialed by the tenant and the landlord.
Now, the vacate clauses in new and existing fixed term tenancy agreements have been eliminated with the exception of sublease agreements or circumstances prescribed in the Residential Tenancy Regulation. For example, the landlord may require the tenant to vacate the property if they or a close family member (as defined in the Residential Tenancy Act) will be occupying the property in good faith. The reason that the tenant must vacate the property at the end of the fixed term tenancy must be set out in the field indicated below and the landlord and tenant must both initial in the applicable boxes.
Fixed term tenancies now automatically convert to month to month tenancies upon the expiry of the fixed term until the landlord and tenant mutually agree to a new fixed term tenancy. Please note that the above-noted changes are retroactive. This means that even if you are currently party to a fixed term tenancy agreement which requires the tenant to vacate the property on or before the last day of the fixed term tenancy, these changes apply. There are two exceptions: (1) landlords who are expecting their tenant to move out at the end of the term and have already entered into a tenancy agreement with a new tenant and (2) a landlord who was granted an order of possession requiring a tenant to vacate the property but the possession order takes effect after December 11, 2017.
The rationale for these changes presented by the government is to protect renters in British Columbia. Specifically, these changes close the so-called fixed term tenancy loophole and accordingly, landlords can no longer bypass rent control provisions. However, it is anticipated that these changes will have unintended affects such as reducing the total stock of rental properties available as landlords fear the strict requirements to evict “bad” tenants and causing landlords who would otherwise charge their tenants below fair market rent to charge fair market rent.
If you have questions with respect to the above, please feel free to contact one of our lawyers practicing in the area of real estate law. If you wish to obtain further information about the Residential Tenancy Act or residential tenancy matters in general, we recommend that you reach out to the Residential Tenancy Branch at 1-800-665-8779 or visit www.gov.bc.ca/landlordtenant.
Author: Danielle (Dani) Brito
This information is general in nature only. You should consult a lawyer before acting on any of this information. This information should not be considered as legal advice. To learn more about your legal needs, please contact our office at (250)448-2637 or any of our lawyers practicing in the area of real estate law at the following:Una Gabie: firstname.lastname@example.org Jennette Vopicka: email@example.com Danielle (Dani) Brito: firstname.lastname@example.org Jane Otterstrom: email@example.com