Saskatoon City Council approved proposed changes to policies governing the conversion of existing rental apartments to condominiums at last night’s council meeting.
City administrators presented their report which was prepared in response to a request brought forward by Councillor Pat Lorje during the meeting of City Council held on August 13, 2007 to “provide a report to the executive Committee on a review of our existing condominium conversion bylaw, together with suggestions for improvements to ensure an adequate supply of affordable rental housing while still maintaining an orderly investment market for multi unit accommodation.”
The report highlighted the positive and negative “implications” of condo conversions including the reduction in the supply of rental housing, the disruption and displacement of existing tenants, the creation of opportunities for affordable home ownership, investment and upgrading of older properties and the opportunities condo conversions create for small investors to enter the market.
The current condominium conversion policies offer the following protections for tenants occupying the apartments to be converted:
1) tenants must receive at least three months notice prior to an application being submitted;
2) tenants must receive a reasonable opportunity to purchase a converted unit in the building; and
3) tenants, at the time of application, may stay for up to two years after the date of application.
The report, written by Tim Stueart, Manager of the City’s Development Review Section noted, “In recent months, a number of investors have been undertaking measures to remove tenants from buildings in order to circumvent the requirement to allow tenants to stay in place for up to two years after the date of application. This has been done by giving tenants notice to vacate their units prior to condominium conversion application, or by significantly increasing rental rates.”
Both of these practices are allowable under Saskatchewan’s Residential Tenancies Act, in spite of the hardship that they can cause at a time when vacancy rates are low and alternate accommodations are difficult to find.
The new policy, approved last night brings the following changes:
1) increase the notice period for tenants from three months before an application is made for conversion to six months before an application is approved;
2) delete the provision which allows tenants to stay in place for up to two years after the date of application;
3) add a new clause which will provide that during the six month notice period, no rent increases shall take effect and no construction related to the condominium conversion shall be undertaken;
4) add a new clause which will provide that should the rent be increased or construction related to the condominium conversion be undertaken during the notice period, the applicant will be required to begin the notice period again from the date that the rent increases take effect or the date that the construction work is completed; and
5) add a new clause which will provide that where an applicant has vacated or substantially vacated a residential building prior to submitting a condominium conversion application, the application shall not be approved for twelve months from the date which it is submitted. This requirement shall be waived where a building is vacant as the result of significant damage or where t has been vacated as the result of a Health or Fire Order.
Clearly, these changes provide a strong disincentive for investors to attempt to circumvent policy. Hopefully, they will provide a fair balance for both tenants and landlords when it comes to notices to vacate.
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