No more lease transfers? Quebec has passed a new housing law. Here's what's in it
Lease transfers kept rents low for some tenants but were costly for landlords
Quebec's controversial housing bill became law on Wednesday — and housing advocates say lease transfers are now essentially dead.
Housing Minister France-Élaine Duranceau has pitched the new law, previously known as Bill 31, as a way to "re-establish balance between renters and landlords and increase housing supply."
But it has drawn the ire of housing advocates who argue that the law's most significant impact will be the power it gives landlords to deny a lease transfer for any reason.
So, what's in the new law?
Landlord can refuse lease transfers
Lease transfers gave tenants the right to transfer their lease to another person — there were mechanisms in place to protect landlords, but they had to prove they had serious concerns about a new tenant to justify refusing a lease transfer.
Now, a landlord can do so for any reason — and can terminate the lease if a tenant asks to transfer it.
For housing advocates, lease transfers were a way to pass on low rents to others and ensure that landlords couldn't hike rents between tenants.
In Montreal, where the housing crisis is pricing some tenants out of the market for an apartment, a one-bedroom apartment now costs an average of $1,744 per month, according to rentals.ca.
Lease transfers, by comparison, are generally lower and can come in below $1,000, often for apartments where leases have been passed from tenant to tenant for years, sometimes decades, keeping rents frozen in the past, in a sense.
Some landlords have decried the practice, arguing that lease transfers can keep rents artificially low, placing a financial burden on the landlord.
The housing minister has argued that landlords have a right to approve anyone renting a unit from them, something they can't do with a lease transfer.
"The landlord owns the building, they invested in it and took the risks, and it should be up to them to decide who lives there," Duranceau said last year.
Pro-tenant content
In response to criticism from housing advocates and opposition parties, Duranceau has touted the law's pro-tenant content.
The new law includes some additional new protections for tenants.
Tenants who don't respond to eviction notices will now automatically be deemed to have refused the eviction notice. Previously, tenants had to bring a form to the housing tribunal — the Tribunal administratif du logement — to refuse an eviction.
Landlords will also have to compensate tenants when evicting them. They'll have to pay for "reasonable moving expenses" and one month's worth of rent for every year the tenant spent in the dwelling.
Even if the tenant has lived there for less than three years, the landlord must pay them a minimum of three months' rent when evicting them. The compensation amount is capped at 24 months of rent, however, even if a tenant has lived there longer than 24 years.
Tenants can now ask for damages if they can prove their landlord kicked them out on false pretences, even if they consented to leave. The burden of proof will rest with the landlord to prove they acted in good faith.
Tenants also can now seek punitive damages if they find out the landlord lied on Clause G of a lease — the lowest rent paid for the dwelling in the last 12 months.
The law is also intended to help ease the housing crisis by increasing housing supply. It includes provisions for municipalities to circumvent local bylaws to approve housing projects, as long as they either include mostly social, affordable or student housing units, or if the municipality has a population of more than 10,000 people and a vacancy rate below three per cent.
Criticism
Julien Delangie, a lawyer with a specialty in housing, said the law contains interesting provisions for tenants but doesn't go far enough.
He said he doesn't understand why the government wants to weaken lease transfers — other than to allow landlords to increase the rental price before taking on a new tenant.
"Their argument to limit the scope of the transfer of the lease is to say 'well, we want the landlords to increase the rents and to make more profit out of the buildings,'" he said. "I don't understand that provision."
Virginie Dufour, the housing critic for the Quebec Liberal party, said there is nothing in the law to "really help the housing crisis" and the lease-transfer changes may make it worse, especially for those who have trouble finding a low-cost apartment.
"Right now it's one of the only ways they can do that," she said, "especially tenants who are victims of discrimination."
She said the law also gives municipalities new "superpowers" to develop housing which could "open the door" to corruption and collusion.
Duranceau said the government would be careful to monitor development and ensure there is no corruption.
Gabriel Nadeau-Dubois, co-spokesperson for Québec Solidaire, had called for a moratorium on renovictions — evictions by landlords who renovate their property to increase rents — to be included in the law. But the government added no such requirement.
"The housing crisis is a social problem for which there are political solutions," Nadeau-Dubois said at a news conference earlier this month, "and if François Legault and his housing minister had accepted our outstretched hands, tragedies like [renovictions] could be avoided in Quebec."
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with files from Cathy Senay