Bill 31 and the modernization of the rules surrounding the assignment of leases

Montreal, June 26, 2023 - The Corporation des propriétaires immobiliers du Québec (CORPIQ) wonders about the clear opposition of tenants' associations to the amendment announced in Bill 31 on the assignment of leases. Remember that this provision of the Civil Code was originally intended, 40 years ago, to make tenants accountable for contractual terms and conditions, including full payment of monthly rent. Since a significant number of tenants in Quebec move out on July 1st of each year, the chronology of relations between a landlord and tenant, in relation to the renewal or non-renewal of the lease, has been built around a sequence of communications starting in the preceding 6 months. Since 2020, the increasing number of lease transfers has jeopardized the smooth running of the move-out period and, above all, the sound planning of maintenance work on the rental stock. Moreover, lease assignments systematically discourage rental landlords from investing in the upkeep of Quebec's aging housing stock, and create unnecessary tensions with tenants.

Assignment of lease: CORPIQ defends Quebec's preferred balance

Bill 31 modernizes certain rules by allowing the landlord to refuse or accept an assignment of lease, whereas previously it was the tenant who ultimately had the unilateral right to decide to whom his or her dwelling could revert. With the adoption of Bill 31, it is now the landlord who will have this prerogative. A rule applied in many other legislations and normal within the framework of property rights.                

Unfortunately, the current situation has led to a number of excesses, including the lucrative sale of homes in a real estate market under pressure. "The Minister of Housing is correcting a situation that deviated from the spirit of the laws originally laid down by the legislator in the 1980s. In Quebec, tenants are asked to renew or not to renew their leases before March 31 of each year, according to a procedure governed by the Tribunal administratif du logement (TAL). With low vacancy rates across Quebec, many tenants have falsely indicated to landlords that they are renewing their leases, while in fact passing on their leases to another tenant, sometimes pocketing several months' rent.  This situation does far more harm than good to the rental sector, with both tenants and landlords losing out in the long run.  Quebec had to act in everyone's interest," said Marc-André Plante, Director of Public Affairs and Government Relations.

The solution to the housing crisis: Create new supply for everyone!

There is no shortage of studies demonstrating the importance of building new housing. Whether we're quoting CMHC or APCHQ data, or the forecasts in the Aviseo Conseil study commissioned by CORPIQ, it's essential to boost the pace and rhythm of housing starts across Quebec. Assigning rental leases is in no way a solution to the housing crisis. "CORPIQ understands the concerns of tenant associations in the current context. On a day-to-day basis, tenants are confronted with difficult realities. However, we should all be focusing on the diversified tools that will enable all players in the housing sector to create housing for all. The debate on lease assignment is a distraction from the issues that should mobilize us today. Quebec needs a concerted strategy from its housing partners, and tenants certainly have ideas to influence the thinking. Last Thursday, the CMHC revealed in a report that the private housing sector in Greater Montreal offers nearly 145,000 units for less than $750. This is 50% more than the number of low-cost housing units in the same area. The affordability of private rental housing does exist, and landlords are facing the same constraints as a result of the effects of the economy on real estate. CORPIQ reiterates that policies aimed at housing maintenance and renovation are essential in the short term, and modernizing the rules surrounding lease transfer is one example, as is the calculation of depreciation for major works," concluded Mr. Plante.

 

About CORPIQ

A non-profit organization bringing together 30,000 owners and managers who own nearly 600,000 rental units and condos, CORPIQ is the largest association to offer services to housing owners and to defend their interests, for over 40 years. It serves all regions from four offices with a total of 60 employees. Quebec landlords provide housing for 1.5 million tenant households, and seven out of ten of them own a duplex or triplex.

Information and interview requests :

Marc-André Plante

Director, Public Affairs and Government Relations - Corporation des propriétaires immobiliers du Québec

Cell: 514-249-1691

E-mail: maplante@corpiq.com