If you are a landlord or a tenant of a residential unit, or are considering to become either, this is an article of interest to you. On January 1, 2004, changes to the law governing BC’s rental community came into effect. These changes to the Residential Tenancy Act were made to reduce areas of ambiguity within the Act. As a result, there are changes for both landlords and tenants.

The following is a summary of some of the more significant changes:

Rent Increase Provisions

Annual percentage increases can now equal the sum of the consumer price index plus 2%. So, for increases after January 1, 2004, the allowable increase could be up to 4.6% without tenant dispute at arbitration. Tenants and landlords can agree, in writing, to amounts other than this. Landlords can also include a provision in the lease agreement that rents charged could vary depending on the number of occupants residing at one time.

Damage Deposits

In order for the landlord to have a valid claim of keeping a portion of the damage deposit, an inspection report must be completed on the first and last day of tenancy. Both the landlord and tenant must be present, but if after two opportunities the tenant is not available, the landlord can complete the inspection alone. Initial inspection reports are not required for tenancies starting prior to January 1, 2004. Reports must be signed by both parties 7 days after initial tenancy and 15 days at the end of tenancy.

A landlord must make a claim against the damage deposit within 15 days of the later of the last day of tenancy or when the landlord receives a forwarding address from the tenant. Landlords who don’t return or make a claim within the 15 day limit must pay the tenant double the amount of the deposit.

Guidelines for inspection report contents can be found on the Residential Tenancy Office website .


Landlords are obliged to restrict the size and number of pets and can also request a pet damage deposit of an additional half-month’s rent. Guide animals in general and pets existing prior to January 1, 2004 are exempt. The landlord and tenant must complete an inspection report prior to the arrival of any new pets to satisfy damage deposit requirements.

Terminating Tenancies for Landlord’s Use

Landlords can terminate a tenancy with at least two months notice, but must pay the tenant one month’s rent upon termination of the agreement. Reasons for termination must be to convert the residential property to strata lots, or to demolish the rental unit, or if as part of a sale, the purchaser requests to terminate the tenancy. The landlord is required to pay the tenant two months rent if he or she fails to make such use within six months after termination.

Other Grounds for Terminating Tenancies

Reasonable cause” has been eliminated and replaced with more specific guidelines. Landlords may end a tenancy if the tenant is repeatedly late paying rent, fails to pay utility charges owed to the landlord, refuses to obey an arbitrator’s order or is involved in illegal activities.

This is just a summary of some of the changes made to the Residential Tenancy Act. As either a landlord or a tenant, we recommend that you review the act carefully upon entering into tenancy agreements. Visit the afore-mentioned website.