Airbnb-style charges creeping into regular rental market: CTV investigation
Published Thursday, September 14, 2017 7:02PM PDT
Last Updated Saturday, September 16, 2017 1:06PM PDT
Extra fees that were once just charged in the grey market of short-term rental properties are now being asked for by dozens of landlords of regular rental properties – even though those fees could actually run afound of B.C. law.
Those are the results of a CTV News hidden camera investigation, which discovered the widespread use of a “cleaning fee” – adding a higher costs to already sky-high rents in Metro Vancouver, a city in the midst of a major housing crisis.
Dozens of longer-term, month-to-month and year-long lease listings on Craigslist asked for such a fee, as did every listing on some property management company websites, which called it a “move-out cleaning fee,” payable up front, as a “standard” condition of renting the suite.
The fee – ranging from around $150 to $300 in the listings examined by CTV News – was supposed to cover the cleaning of the apartment when the tenant leaves.
But tenants and landlord groups told CTV News it’s anything but “standard” – and there’s no justification to charge an extra fee when the landlord is also charging for a damage deposit already.
“You can’t do that. That’s why you have a damage deposit in a proper tenancy agreement,” said David Hutniak, the CEO of Landlord BC.
He said the type of charges that a landlord can levy is highly regulated by the Residential Tenancy Act. The act prohibits most types of fees and says the maximum that a landlord can hold in most tenancies as a damage deposit is half a month’s rent. If the property is especially dirty, landlords can apply to hold back the deposit to pay to clean the suite.
Airbnb, which operates despite city rules against the website, gives hosts the option to add a cleaning fee to their listings.
CTV News visited several suites to ask what was entailed with a “cleaning fee.”
In one Chinatown 537-square-foot one-bedroom unit on offer for $1,850 a month, the agent said a $150 cleaning fee was part of the deal.
“It’s standard,” the agent said. “It helps cover the cleaning costs. It’s always paid up front.”
When asked if cleaning would be covered by the damage deposit, the agent said, “No, it’s separate.”
In another suite visited by CTV News, a $2,200, 530-square-foot one-bedroom apartment off Main Street in Vancouver, the landlord asked for a $150 cleaning fee as well.
“Most condos charge a cleaning fee when you move out,” she said. She added that the tenant could also pay for their own cleaning, on top of the half-month’s rent damage deposit.
But Andrew Sakamoto of the Tenants Resource and Advocacy Centre said that such fees aren’t standard.
“I’d like to see it challenged,” he said, referring to the option that tenants have to challenge their landlords at the province’s Residential Tenancy Branch.
Sakamoto said that the fact extra fees are even charged shows the power that the landlord has in a market where the vacancy rate is so low and competition for scarce spaces is driving up prices. The Canada Mortgage and Housing Corporation measured Metro Vancouver’s vacancy rate as 0.7 per cent.
“It’s definitely a symptom of the rental housing crisis we find ourselves in,” Sakamoto said.
He said it’s possible for tenants and landlords to contract together to provide a cleaning service. But he said that he doubted demanding the money up-front as part of the tenancy itself was allowed.
“You could make an argument that this is an example of a time where a landlord is asking you to overpay a deposit. So I’d like to see how an arbitrator would rule on this matter,” he said.
One Vancouver property brokerage, RentItFurnished.com, says it’s investigating whether it should continue asking for the fee on its approximately 1,700 listings.
And Dexter Property Management, whose listings also included the fee, took them down this week, a company spokesman said.
The brokerages are regulated by the Real Estate Council of B.C. but a council spokesperson told CTV News that they only check for compliance with the Real Estate Services Act – not the Residential Tenancy Act, which has provisions on the fees and damage deposit.
B.C.’s housing minister, Selina Robinson, said she’s boosting funding for the Residential Tenancy Branch, as well as giving it a proactive team to catch potential abuses.
“There hasn’t been a compliance unit yet. That will be one of the new things we see coming online,” she said. “Every time I hear one of these stories I get more and more frustrated.”