The New Brunswick Finance and Treasury Board announced on March 22th, 2022 their new 2022-2023 budget, which includes future modifications to the Real Property Tax Act and the Residential Tenancies Act of New Brunswick.
Tax cut for property owners
The provincial property taxes in New Brunswick are doubled for rental properties, apartment buildings or for any non-owner-occupied residential properties, like cottages. The province has been talking about reducing the tax rate for a long time, without anything concrete. But the good news has finally come!
- The government will provide a reduction of 50% of the provincial tax rate on these type of properties over the next 3 years.
- It also includes a reduction of 15% of the tax rate for any other residential properties, including nursing homes.
- And the non-residential properties, like commercial properties, will take advantage of a 15% tax rate reduction.
You want to increase the rent?
The government of New Brunswick have modified the section 11.1 of the Regulation under the Residential Tenancies Act. A landlord has to give a proper notice to the tenant for a rent increase:
- At least 3 months for a fixed-term lease.
- At least 6 months for a year-to-year and month-to-month leases.
*It changed from 3 to 6 months, except for the fixed-term lease.
In another hand, landlords cannot increase rent within the first year of a tenancy and it can only be increased once every year. Also, the notice of the increase has to be on a separated document from any other notice or receipt. The increase has to be the same percentage than each comparable unit in the same building or reasonable in relation to that charged for comparable units in the same geographical area.
Rent cap
Furthermore, in the province of New Brunswick, there is no rent cap. For example, a tenant can receive a notice any day from a landlord that his rent increases from 1000$ to 2000$.
The government announced a proposed one-year rent cap of 3.8%, retroactive to January 1st, 2022. But that modification is not yet added into the Residential Tenancies Act of New Brunswick, which creates some confusion for landlords. We don’t know how the retroactive part will work. This amendment to the law if supposed to happen on June 1st, 2022.
Harder to kick out tenants
The government will make further modifications to the Residential Tenancies Act that:
- The landlords will not be allowed to kick out tenants without cause.
- The landlords can be ordered to compensate for losses caused by termination without cause and are subject to penalties for non-compliance.
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