N.S. rent cap extension futile due to ‘massive loophole’ in rental system: advocates

Housing advocates and opposition parties say a loophole in Nova Scotia’s rental housing rules is making the provincial government’s proposed rent cap essentially useless.

On Friday, Service Nova Scotia Minister Colton LeBlanc tabled legislation that would extend the existing five per cent cap on rent increases for another two years to the end of 2027.

Tim Allenby, co-chair of the Dartmouth chapter of housing advocacy group ACORN, says the province’s efforts to cap rents will not help renters so long as fixed-term leases are allowed.

A fixed-term lease, unlike a periodic lease, has a set start and end date and is not extended beyond the fixed period of time without the signing of a new lease.

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The provincial rent cap covers periodic lease renewals and situations where a landlord allows someone on a fixed-term lease to sign a new agreement for the same unit — but it does not apply to leases signed with new tenants.

Allenby says these rules encourage landlords not to re-sign with a tenant and to instead rent to someone new so they can increase the rent well beyond the cap.

This practice is pushing people towards homelessness, Allenby says, as some renters are being pushed back into the market and are unable to find housing they can afford.

The Department of Service Nova Scotia did not immediately respond to request for comment.

This report by The Canadian Press was first published Sept. 9, 2024.