Plans would see rent payments count toward credit score
Prime Minister Justin Trudeau has unveiled new measures aimed at boosting renters’ rights and improving their prospects of buying a home amid an ever-deepening national housing crisis.
The proposals, announced on Wednesday, would see on-time rental payments contribute towards an individual’s credit score when applying for a mortgage as well as giving tenants more rights in landlord disputes and protecting against so-called “renovictions.”
They mark the first of an expected flurry of housing-related announcements prior to the federal budget, scheduled for April 16, as the government bids to shore up lost support among younger Canadians and tackle the nation’s housing woes.
A government news release said the proposals were about “generational fairness – making sure millennials and Gen Z, who are most likely to rent, get a level playing field in the rental market.”
The new rules would see the Canadian Mortgage Charter amended to factor rent payments into credit scores, while $15 million has been earmarked for provincial legal aid organizations to protect tenants against so-called “bad landlords” and unfair rent payments.
Landlords would also be required to reveal a property’s pricing history under a new Canadian Renters’ Bill of Rights, a measure the government said would allow renters to strike a fair deal on monthly payments.
Proposals arrive amid desperate times for Canadian renters
The cost of renting an apartment or home in Canada has spiked alarmingly in recent times, with a chronic shortage of supply contributing to the lowest national vacancy rate since that data tracking began in 1988.
The average rent for a two-bedroom purpose-built apartment jumped by 8% across the country in 2023, according to Canada Mortgage and Housing Corporation (CMHC), a huge increase from the average yearly increase of 2.8% between 1990 and 2022.
Rental properties saw their average listing price surge to $2,196 in January, a 10% spike over the same time a year prior and 20% above asking prices in January 2020, just before the beginning of the COVID-19 pandemic.
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