Halifax Landlord Defends Fixed-Term Leases
HALIFAX — Debate around fixed-term leases has heated up in Halifax. Now that Nova Scotia has rent control in place until at least 2025, the controversy around these types of leases has taken centre stage in the ongoing rental crisis.
Fixed-term leases, as the name suggests, have a specific start and end date and don’t automatically renew like a traditional annual agreement. This means that landlords can choose not to renew even if the tenant wants to stay in their unit. This allows landlords to circumvent the rent cap, since it doesn’t apply to renters moving into a unit for the first time.
Nova Scotia’s rent cap does still apply, however, if a tenant is renewing a fixed-term lease for their old unit. Despite this, there are reports of tenants, mainly students, being asked to pay above the two per cent cap if they want a new fixed-term lease.
These stories have advocates calling for more protections for people on fixed-term leases; some have even called for the complete abolition of the practice. But one Halifax landlord, who uses this type of lease exclusively, is defending the practice.
Issmat Al-Akhali owns Granville Hall Student Residence, which operates 30 rooms in a dorm-style building. A room at Granville is $1,100 per month (all inclusive). Last year, rent increased by 10 percent for all rooms.
Al-Akhali says it’s the first increase he’s put in place since Granville opened in 2017.
Since all of his tenants are students who usually only want to stay for the academic year, Al-Akhali argues that fixed leases works for both parties.
“You need a place to stay temporarily while you learn about the neighborhoods and meet some friends that you’re comfortable living with, and then move on to a longer-term lease. So, it’s a win-win. Students want a short-term lease and we want to give them flexibility,” argued Al-Akhali.
In the summer, Al-Akhali converts Granville into a hostel, where people stay for even shorter stays.
The landlord argues if the province ever banned fixed-term leases, it would cause a major headache for both tenant and landlords. Students who go home for the summer will have to find a subletter, which comes with risks. In Nova Scotia, landlords have the right to approve or reject a sublet.
“Come April, there’ll be a glut of postings on Kijiji for people looking to sublet,” predicts Al-Akhali. “They try to sublet the remaining four months because they’re responsible for rent for those four months, but they’re not living here. And everybody’s trying to get rid of the remainder of the lease at the same time and not everybody is able to do that.”
“That creates a lot of administrative work as they are trying to show rooms to potential renters and trying to negotiate a sub-lease. And then the landlord must approve this person that’s coming into our building as a subletter.”
When asked for his thoughts on accusations of landlords refusing to resign a fixed-term lease, so they can charge more to a new renter, Al-Akhali blamed the rent cap for this issue.
“That’s a difficult situation for the students, or any renters really, that are starting to see the outcome of a short-sighted law that says landlords can only pass on two per cent of increased costs, when those costs are ballooning over double digits, but by no fault of the landlord.”
“Landlords are noticing increases in their monthly cost of 25, 30, 35 per cent. And they’re told they can only pass two per cent of that onto tenants. So, I’m not surprised that some landlords are trying to find whichever legal means possible to ensure to protect themselves.”
Huddle recently spoke with two Kings College students in Halifax who had hardships with fixed-term leases.
Katie Cheslock, a third-year international studies student, lives in a three-bedroom apartment with two roommates. They once paid $700 each (electricity not included), but their new fixed-term lease will have them pay $800. She didn’t mince words when giving her opinion on fixed-term leases.
“I think that they’re a somewhat exploitive and incredibly frustrating loophole to the existence of a rental cap, which is a sentiment that’s echoed by a lot of students,” she said.
“I remember when I was originally looking for a place to live with my roommates, we talked to a number of different landlords and looked at different leases. And we were trying quite hard to avoid signing a fixed-term lease because we knew it could potentially come back to bite us down the line.”
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Ian Kerr and his roommate were paying $925 each for their apartment this academic year. But Kerr says, if they wanted to renew their fixed-term lease for next year, the landlord was asking for $200 more. So they are moving out in April.
Derek Montague is a Huddle reporter in Halifax. Send him your feedback and story ideas: [email protected].