N.B. landlords accused of scaring tenants with flyer warning of potential rent increases

A tenants' advocate is slamming a New Brunswick landlord association for distributing flyers warning tenants their rents could go up as a result of higher property assessments on apartment buildings.

Jael Duarte of the New Brunswick Tenants Coalition said she's been receiving calls from tenants who are afraid and confused after getting the flyers in their mailboxes in recent days, warning that their rents could go up by as much as $700 annually to cover higher property taxes expected in 2022.

The flyers, created by the New Brunswick Apartment Owners Association, go on to say "Premier Blaine Higgs can stop this," and they ask recipients to email or call him "and tell him that you don't want your rent to increase to pay for these higher taxes."

Duarte said the flyers represent an abuse of power by landlords toward their tenants, by scaring them into advocating on their behalf.

"It's harassment, it's an invasion of privacy rights," Duarte said. "There is an imbalance of power between landlords and tenants, and the landlords are using the power to force tenants to do something that otherwise they may [not do]."

The flyers also denounce the so-called "double tax," which refers to the requirement that an owner of a building pay a provincial property tax in addition to the municipal property tax if they don't occupy the building.

The New Brunswick Apartment Owners Association has long advocated for an end to the tax, arguing that it discouraged developers from building apartment buildings, contributing to the housing shortage. Higgs's Progressive Conservative government had promised to get rid of it but didn't.

Association defends flyer

Willy Scholten, president of the association, said it didn't send out the flyer in the interest of landlords, but in the interest of tenants and helping to keep rents from rising.

"We're not advocating for this for us, the landlord," he said. "If, if this [double tax] gets decreased to offset these assessments, then we won't have an increase in tax and then we won't have to pass that on to tenants."

The assessed value of properties in New Brunswick saw one of its biggest increases in years this fall as Service New Brunswick sent notices for the assessed value of homes and businesses in the province for 2022.

The increase in assessed value was so big that many municipalities even took steps to offer relief to homeowners by reducing their property tax rates.

But Scholten said those decreases in municipal property tax rates won't offer much relief to apartment owners, as 90 per cent of apartment buildings saw their assessments go up by 15 to 20 per cent.

He said his association is now hoping the province either reduces the property assessments of apartment buildings, or changes property tax rules to give municipalities the ability to specifically reduce the tax rates for apartment buildings.

"Some people think that property taxes is just a small amount of our of our business, but as I said, it's 35 to 40 per cent of our operating costs, and with this 20 per cent increase, it's going to be that much more of our operating costs.

"So it will absolutely have to be seen in the rental rates."

Jennifer Vienneau, a spokesperson for the province, said in an email that all apartment buildings with four units or more located in urban areas are seeing an increase of 15 to 20 per cent in property assessment.

She said assessments reflect values established by knowledgeable buyers and sellers, and the main method used to assess apartment buildings is "the income approach," which is the most common method used in North America.

Vienneau said the provincial government has indicated it will consider lowering the tax on non-owner occupied properties as the fiscal situation allows.

Vienneau did not say whether the province would reduce its assessments for apartment buildings, or grant municipalities the ability to charge lower property taxes on apartment buildings.