Real Estate Talk:
New rental rule in Bill 31

Now the landlord will not be required to provide any reason to refuse a sublet or reassignment

By Joseph Marovitch

June 28, 2023

An amendment to Bill 31 recently passed, and in this bill, there is a reference to residential rental terms that are not in favour of a lessee. Up to November 17, 2022, if a lessee would be relocated due to employment requirements or financial issues, the lessee was permitted to either re-assign or sublet their lease to another lessee who would either pay the same or higher rent than the current tenant. The landlord could refuse this proposed lessee if there was a good and lawful reason. In other words, the landlord could not unreasonably refuse the reassignment or sublet.

With the new amendment in Bill 31, the landlord does not require any reason to refuse the sublet or reassignment. The landlord can force the tenant to remain in the lease. As well, Bill 31 permits the landlord to raise rents and not be subject to the rental board. This means a lessee will not be able to contest an unreasonable rent increase. The lessee will only have the right to accept the increase or vacate the premises.

… why would the Minister be so insensitive, considering Quebec has a housing crisis in which the people who elected her cannot afford a rental home and the fact that inventory is low.

The Quebec Minister, France-Elaine Duranceau, who must own income properties, stated that tenants should not have the right to dictate who the next tenant will be since it is the landlord that must deal with them in the future. However, the landlord did have the right to refuse a transfer of the lease if the proposed tenant did not meet certain criteria, such as being employed, having a good credit rating, and having good references from their last landlord. Therefore, why would the Minister be so insensitive, considering Quebec has a housing crisis in which the people who elected her cannot afford a rental home and the fact that inventory is low.

Every so, often governments create laws that can be considered unethical, not for all the people, or in favour of the individual or individuals who are in power. Fortunately, we live in a democratic society where we can protest and/or vote them out. This also means that if we do not consider all the policies of proposed elected officials and only consider the policies that favour each of us, we can only blame ourselves for the predicament we find ourselves in.

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State of the market

Bank of Canada Prime Rate 6.95%

Tier One Banks Prime Rate:
BMO 6.95% – TD 7.10% – Scotia Bank 6.95% – RBC 6.95% – CIBC 6.95% – National Bank 6.95%

The Bank of Canada indicated today that consumers should expect another interest rate hike even though the inflation rate has dropped to 3.4%. The Bank of Canada is trying to reduce inflation to a pre-pandemic rate of 2.5%. However, between wars, nuclear threats, pandemics, slow supply chains and climate change, there is no going back to 2.5% inflation. Further interest rate hikes may only serve up recession.

‘… between wars, nuclear threats, pandemics, slow supply chains and climate change, there is no going back to 2.5% inflation.’

In high-end real estate, property is moving since buyers are putting down more or all capital or taking shorter-term mortgages. However, in the mid-range priced property, it is increasingly more difficult for buyers to attain affordable mortgages. Combined with a housing shortage and unreasonable rental rules, the Federal and Provincial governments are not doing anyone any favours.

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Other articles by Joseph Marovitch