The Island Regulatory and Appeals Commission has set the maximum allowable annual rent increase at one per cent effective Jan. 1, 2021.
This increase may be applied to all rental units including:
- heated premises,
- unheated premises and
- mobile home site located in a mobile home park.
Public input
IRAC calculated the increase after receiving submissions from tenants, landlords and members of the public. This year, 48 submissions were received from 39 tenants and nine landlords by the deadline of Aug. 14.
Calculation
In calculating the amount of the allowable rent increase, IRAC takes a number of factors into consideration. First, it reviews the submissions received from the public; second, it reviews the costs of a number of housing-related items including:
- 2020 All-items P.E.I. Consumer Price Index for the 12-month period of July 1, 2019 to June 30, 2020;
- Furnace oil (the average price of furnace oil dropped by 14.7 cents per litre for the period July 1, 2018 to June 30, 2019 compared with July 1, 2019 to June 30, 2020);
- Electricity (rates have not increased since 2018; the Commission will be reviewing rates in the near future);
- Water and sewer rates, insurance, property taxes, maintenance costs, waste watch rates and interest rates.
Notice Required
Under the Rental of Residential Property Act landlords are permitted to raise the rent once every 12 months and are required to provide tenants with three months’ written notice on an approved form before the rent increase can take effect.
Rent increase beyond the allowable amount
Landlords seeking rent increases greater than the allowable amount must apply to IRAC and provide the required information.
Permitted timing of a rent increase
If a tenant rents a unit beginning Sept. 1, 2020, the date of the first allowable increase is Sept. 1, 2021, provided the tenant received three months’ written notice on an approved form.
For more information, visit the IRAC website.
