Daniel Greenhalgh Responds: Rental-Only Zoning Law

In May 2018, the B.C. provincial government passed legislation allowing municipalities to zone for rental-only developments. The new tool gives cities the power to mandate that a certain percentage of units be rentals, or to protect existing rental properties from redevelopment.

In January, New Westminster became the first B.C. city to use the new tool when it approved a bylaw to rezone 18 existing properties as rental-only. Twelve of the properties are city-owned, while the remaining six are privately owned stratified buildings that have been operating as rentals for many years.

The rental-only zoning tool is the first of its kind in North America, and the manner in which it’s wielded in the coming weeks and months will set a powerful precedent. Daniel Greenhalgh, Development Consultant, believes that New Westminster’s use of it is potentially dangerous for property owners. 

“I think the tool should be deployed to encourage new rental supply, not to levy penalties on property owners. These owners in particular have all rented out their units for years and had no plans to sell the units or the building. But the city has devalued their property, seemingly arbitrarily, with no compensation or even consultation. I believe this is a political move so that council can be seen as stopping renovictions, even though no renovictions were planned for these properties. 

“The more potent path to affordable rental units would be to streamline and incentivize the construction of multi-family rental properties in B.C. Right now, there’s routinely a 5-8 year wait to get a rental property permitted and completed. Then, when you have taxes and fees that tack on about $50,000 to the cost of each unit, we have a lot of self-inflicted wounds that could easily be remedied. Addressing those problems would be a much wiser course than taking away individual property rights.” 

Last week, Richmond sent a proposal to rezone sixty properties as rental-only back to the planning committee. Council members pointed out that the city already requires replacing every lost rental unit with another one. Coquitlam recently rejected a similar proposal.