The Detrimental Effects in Changing the Rent Contr Essays

The Detrimental Effects in Changing the Rent Contr Essays The Detrimental Effects in Changing the Rent Control Act Rent Control-pro The Detrimental Effects in Changing the Rent Control Act In a just society, the ruling authority must decide what is right when allocating wealth to its individual citizens. The same ruling authority does this by intervening with the inner workings of a marketplace to uphold its fundamental values and ideals. The aim of government intervention is to create a just society that will reflect the peoples values. Governing bodies do this by establishing laws that enforce fairness or equity. The Ontario government passed the Rent Control Act in 1975. The law levels the playing field between landlords and tenants. New units are exempt from controls for their first five years after which the controls are put into place. The controls put a ceiling on annual rent increases. Under current law, a landlord may only increase a tenants rent by 2% plus inflation.1 As with all other markets, the housing market is based on supply and demand. If the nature of the market were allowed to take its course, then the price of housing would become unaffordable for most citizens. An unfair situation would be created where power and money would be disproportionately appropriated to land owners. Rent control laws were established by previous governments to protect society and its people from inflated and uncontrollable housing costs. The Harris government now wants to repeal these laws. On June 25 the Minister of Housing, Al Leach, released a policy paper outlining the changes that are to be made to Ontarios rent laws. Conservative legislators plan to pass the proposed Tenant Protection Act in the fall. The omnibus legislation will rescind the Rent Control Act, the Landlord and Tenant Act, the Rental Housing Protection Act, Residents Rights Act, the Land Lease Statute Amendment Act, the Vital Services Act.2 The most objectionable change allows the act to lift controls off vacant units. The 3.2 million renters in Ontario are very concerned about the changes.3 The housing ministry will accept written submissions from the public until August 30. Public hearings are also planned in hope that they will ease the transition. However, most people are indignant towards the idea. Changing the rent control laws would be detrimental to society as they threaten citizens positive right to affordable housing, harm their mobility rights and increase the gap between the rich and the poor. The proposed Tenant Protection Act assaults peoples right to affordable housing. If people are to adhere to a basic standard of living, then the cost of their homes must be affordable. But what exactly is affordable? The Ministry of Housing released a report stating that 70,000 Toronto house holds (20% of the citys population) do not have affordable housing. The report explains that a tenants' housing is unaffordable if they are paying more than a quarter of their gross income in rent. This is an alarming thought since some renters are paying 70-80% of their gross income in rent.4 The problem of high housing costs is combated by rent control to allow people a minimum quality of life. Housing like medical care is not normal good or service. It is a basic need. Renters need to buy more than landlords need to sell. If the renter does not get a place to live, he is on the street. If the landlord has no tenant, he just has an empty apartment. In short, there is a mismatch of power in the rental market. The laws of supply and demand are unfairly applied against the buyer. Thus controls came into being precisely because the market does not work. Lifting controls would hurt peoples ability to bear the cost of housing without serious harm. The government justifies this action by arguing that something must be done about Torontos apartment shortage. Because apartments are offered below their market value, they are sold faster new ones can be created. Toronto has a vacancy rate of .8% with only twenty new apartment units built in Metro last year.5 Currently, two thirds of renters move once in five years. Since controls are lifted off vacant apartments, the government believes that after a few years, most apartments will be decontrolled and the supply problem would