Rent cap vs. rent subsidy — Alberta party leaders debate best approach while costs increase

In December — after six years on a waiting list — Courtney Townsend finally secured a $900 provincial rental subsidy to help keep her and her kids in their home, close to her parents.

In March, she got the news that her subsidy would be essentially wiped out.

Her landlord said he's raising her $1,800 rent by $800 for her small Lakeview bungalow.

She looked at switching her kids' schools and finding a cheaper rental elsewhere, but she says there wasn't much available. So she signed the renewal papers anyway and is looking for a fourth part-time job or a roommate. She's shocked at the change.

"I don't understand why there's no rent control," said Townsend, who works as a research assistant, retail associate and freelance photographer. 

"$800 all in one shot is just outrageous," she added. "It would be amazing if [the provincial government] had something in place saying they could only raise rents so much every year, or every couple of years." 

Surging rents and a tight supply have many people calling for rent control, especially community groups such as Calgarians for Housing is a Human Right and Edmonton's Interfaith Housing Society, who held a public rally on Sunday.

They point to cases like Townsend's to say more rules are needed urgently.

But other advocates and economists say the situation is more complicated. What is the right path forward?

CBC Calgary spoke with advocates and economists with several perspectives to find out.

And given that Alberta is in the midst of a provincial election, we also reached out to each of the main political parties to see where they stand, and outlined in full what they have to say below.

The UCP says it's opposed to rent control, while the NDP has no defined position on the policy but says it's open to having conversations about it if elected. Both parties point to less controversial options as solutions, like subsidies and more housing. Among the smaller parties, the Green Party is promoting a 1.5 per cent rent cap, the Alberta Party is pushing a broader income support strategy and the Wildrose Loyalty Coalition has no housing platform.

The big debate: Subsidy or rent control?

Alberta is one of the few provinces with no limit to how much a landlord can increase rent, only how often (once a year). The provincial government offers subsidies to low-income Albertans instead, although thousands of people who qualify for them are on a waiting list.

But even among advocates and economists, there's debate over whether rent controls or subsidies are the answer.

Tim Richter, president and CEO of the Canadian Alliance to End Homelessness, says Townsend's situation builds the case for some sort of rent control in the province — though maybe not in the traditional sense it's been implemented in other provinces.

"[It could be] where landlords are allowed to increase rent, but it's at a rate that matches inflation and a reasonable profit for their investment. Not a one-time $800 increase in rent, which seems almost extortionate in my view," said Richter.

But some economists, such as Moshe Lander at Concordia University, say rent control is the worst solution.

"It is absolutely devastating to any city that implements it, and what seems like a temporary problem for a few will become a permanent problem," said Lander, who is an Alberta resident.

Ronald Kneebone, an economist at the University of Calgary's School of Public Policy, says rent control benefits only current renters because as the supply of low-cost rentals gets eaten up, investors are reluctant to build more, and future low-income renters are left scrambling in an even tighter market.

"Future renters are made worse off. Good public policy takes care to introduce policies that help both current and future renters," said Kneebone in an emailed statement.

He favours subsidies.

Untangling the complexity

Sasha Tsenkova, a professor of planning at the University of Calgary's School of Architecture, Planning and Landscape, says subsidies are a quick way to alleviate the stress many renters feel.

But there's an inherent risk.

"When you actually introduce a rent subsidy or rental allowance … it's automatically triggering an increase in the rents," said Tsenkova.

"It's more people with more money — whether it's their own savings or family intergenerational transfer or a subsidy from the government — chasing the same commodity that is in short supply."

In her view, governments must understand the complexity and balance policies such as rent control, social assistance and a push for more rental housing (and low-cost rental housing) overall.

Party rental promises

So what are the parties promising they'll do, if elected? Here's what six of the parties told CBC News about their commitments to rental solutions.

United Conservative Party

The UCP declined a request for an interview and instead pointed CBC to a news conference from March 22 when Jeremy Nixon, minister for seniors, community and social services, addressed calls for rent control.

He said rent control is not on the UCP's radar and instead they're focused on increasing the supply of government-subsidized housing and the rent supplement program.

The UCP also launched a temporary affordability payments program that helps seniors and families with children who have household incomes under $180,000.

Alberta New Democratic Party

The Alberta NDP is promising to build 8,500 more government-subsidized homes and provide rental assistance to 11,000 more Albertan households.

"Affordable housing is a provincial responsibility, and it's something that we can't fall short on," said Malissa Dunphy, the party's director of media relations.

Dunphy says the party is also committed to renewing the discussion about rental policies — like rent control and the Residential Tenancies Act — if elected. She says all who are affected, including renters, landlords and policy experts, would be part of that conversation.

Alberta Party

The Alberta Party says it wants to consolidate and simplify income support programs to help with overall affordability, including housing. Those would be limited to people on income supports.

"When the housing costs go up, there would be some extra assistance there," said leader Barry Morishita.

He said the dollar figure would be set to reflect the basic living costs of each region. He said the party would also like to build more subsidized housing units.

Alberta Liberal Party

Alberta Liberal Party Leader John Roggeveen says they're committed to helping with rents through subsidizing those most in need.

"We think subsidies are better to deal with rental issues in general than rent controls, and that the subsidies need to be broader than they are," he said.

However, rent control could be used in limited and temporary ways in the short term, he added.

Long-term, he says he'd advocate for government-funded housing and work with municipalities to fast track the development of more housing — specifically for low- and middle-income Albertans.

Wildrose Loyalty Coalition

The Wildrose Loyalty Coalition did not respond to CBC's requests for comment. It has no housing-related policies on its website.

Green Party of Alberta

The Green Party of Alberta is proposing a 1.5 per cent rent cap and vacancy control (which would require landlords to limit rent increases to 1.5 per cent between tenants) if elected.

"We are also advocating for the implementation of universal basic income, which no other party is even talking about in this regard," said Jordan Wilkie, leader of the party. 

In the same call, Calgary-Buffalo candidate Jonathan Parks says the Greens are also committed to building more non-market housing, which he says would create healthy competition among landlords and decrease rents.