What is Residential Rental Tenure Zoning?
In July 2018, the Province enacted a new authority that empowers local governments to apply residential rental tenure zoning to protect rental units in existing and future apartment buildings, to increase the overall supply of rental housing in their communities. It can be applied to an area, a building, or units within a building which have a residential use. It does not apply to commercial buildings/ units. The zoning restricts the form of tenure (i.e. occupancy of the unit) to rental only, so residential units with this zoning cannot be occupied by the owner. The exception to this is where a unit is already occupied by an owner at the time that the zoning is put into place. In such a case the owner, and all future owners, would continue to have a right to occupy the residential unit.
What are Bylaw No. 8123 and Bylaw No. 8078 about?
On January 28, 2019 Council adopted Bylaw No. 8078, the purpose of which was to amend the zoning for six stratified rental properties and twelve unoccupied City-owned properties to restrict occupancy of multiple-unit residential buildings at these properties to rental tenure.
Bylaw No. 8123 was adopted on June 10, 2019. This bylaw more clearly achieves the intent of the original bylaw by:
- updating the definition of residential rental tenure
- clearly indicating that the rental tenure zoning does not apply to commercial properties
- revising the descriptions of the affected properties to ensure that changes in legal status, such as the cancellation of a strata plan, do not change the effect of the bylaw.
This bylaw continues the residential rental tenure restrictions for the six stratified rental properties enacted through Bylaw No. 8078, and the further notification procedures and public hearing process for Bylaw No. 8123 also provides an opportunity to address incorrect information that was circulated by the City regarding the effect of the original bylaw on the ability of owners to transfer strata titled lots zoned for residential rental tenure.
A Petition challenging the original bylaw was filed in BC Supreme Court, and the erroneous information about the marketing of individual strata lots is one of the grounds for the challenge. The City filed a response to the Petition, which concedes the inaccuracy of this information.
On May 1, 2023 the British Columbia Court of Appeal released a decision upholding the City's use of the residential rental tenure zoning power. In March 2021, the Supreme Court of British Columbia upheld the same challenged bylaws.
Given that the bylaw has been upheld, Zoning Amendment Bylaw No. 8123 will continue residential rental tenure restrictions for the six stratified rental properties. These units must remain rental-only and cannot be owner-occupied. This decision has broad-ranging implications for other municipalities, as it confirms that the residential rental zoning power may lawfully be used to preserve existing rental stock, even if the subject units are stratified.
What was the reason for applying Residential Rental Tenure Zoning?
In late 2018, it came to the City's attention that a stratified building that appears to have operated as rental since its construction in the 1970s was being actively marketed for sale as units that purchasers could occupy themselves.
Residential Rental Tenure Zoning is the only City-led action that can protect the rental tenure of stratified rental buildings, relieving some of the pressures from renoviction being faced by New Westminster tenants, who represent 44% of the population.
The City was the first municipality to enact Residential Rental Tenure Zoning for this purpose. The use of this zoning to protect the subject residential rental units is a component of a larger Rental Housing Revitalization Initiative, endorsed by Council on January 14, 2019, in response to the city's housing crisis. Buildings operated as rental tenure serve an important role in the community by providing primary rental housing stock with relatively more affordable housing, to households with varied income levels. Over time, existing rental buildings generally feature lower rents than new secured market rental buildings because of their age and the control of rent increases through the Residential Tenancy Act.
How does this protect the rental units in the six stratified rental buildings?
Records indicate the current and historic operation since construction of the six stratified buildings to be as rental tenure. The application of residential rental tenure zoning to these properties protects the recorded historic use of the residential units as rental housing by prohibiting owner occupancy, and restricting tenure to rental only. This applies to residential units in the existing buildings and in any future buildings constructed on the properties under current zoning entitlements.
What were the reasons for choosing the properties?
The six stratified rental properties are: 214 Agnes St, 211 Eleventh St, 514 Thirteenth St., 723 Twelfth St., 215 Tenth St., and 425 Twelfth St. The rationale for choosing these included:
- They fall outside of the City's moratorium on the conversion of rental units to strata titled units.
- Records indicate the current and historic operation since construction of the buildings to be as rental tenure, for time periods that range between 18 and 60 years.
- They are categorized as rental buildings by the City and in federal and regional housing databases, such as CMCH's Rental Housing Inventory
- At least one of the buildings benefitted from federal rental housing funding that was available in the 1970s and 1980s
The twelve undeveloped City owned properties are: 380 Thirteenth St, 232 Lawrence St, 200 Fenton St, and 350, 345, 358, 362, 366, 370, 374, 378, and 382 Fenton St. The rationale for choosing these included:
- The City is committed to leadership in housing.
- The City is communicating its commitment to provide for safe, secure and affordable housing to residents, non-profit housing partners, and other funding partners.
- The City has included these properties in a draft Memorandum of Understanding with BC Housing, for future consideration for development.
Why were other properties with rental buildings not included?
The City's 1978 Moratorium on Strata Conversions policy protects the rental tenure of other existing non-stratified multiple unit rental buildings by prohibiting their future stratification. New purpose built rental buildings are protected through other legislated tools available to the City, such as Housing Agreements.
What is the difference between stratified rental units and stratified condo units?
In a stratified rental building, typically all units are owned by one owner and all of the units are rented to tenants, and not owner-occupied. These buildings are part of the City's primary rental housing stock, as an ongoing and therefore relatively secure form of rental housing.
In a stratified condominium building, typically each condo unit is individually owned and is either owner-occupied or rented to a tenant as part of the City's secondary rental housing stock. This form of rental housing is less secure as owners may choose to occupy the unit at any time, subject to meeting Residential Tenancy Act requirements.
What other things is the City doing to address the housing crisis?
The City is seeking to implement a suite of policies and tools that are within its authority and financial capacity to address the need for additional affordable rental housing, renovictions, maintenance and protection of existing rental buildings, and rental replacement. The application of residential tenure zoning to six stratified rental buildings and 12 City-owned properties is one of these tools.
