The government of British Columbia says landlords will not be allowed to increase rents by more than three percent in 2025.

The government announced that the change, which is linked to inflation, will come into force on January 1. This year, the permitted rent increase is 3.5 percent.

“At a time when we know renters are struggling, our rent cap protects renters from unfair rent increases and allows landlords to cover rising costs so rental housing can stay in British Columbia’s housing market,” British Columbia Housing Minister Ravi Kahlon said in a news release Monday.

Linking the annual allowable rent increase to inflation is in line with the recommendations of the Rental Housing Task Force, says Spencer Chandra Herbert, MP for Vancouver West End and the Prime Minister’s liaison on tenant issues.

Inflation returns to “normal levels”

The government says the change is being made because “inflation is returning to more normal levels.”

Due to the pandemic, the province imposed a freeze on rent increases in 2020 and 2021. In 2022, the cap on rent increases was 1.5 percent, and in 2023 a cap of two percent was applied.

If landlords want to increase rent, the government says they must comply with the Residential Tenancy Act and give tenants three months’ notice. Rent may not be increased more than once in a 12-month period, the province explains.

The maximum increase for “manufactured housing park leases” will also be three percent in 2025, the province said, plus a proportional amount for changes in local taxes and regulated utility fees.

The three percent cap does not apply to commercial tenancies, non-profit residential tenancies where rent is set according to income, housing cooperatives and some assisted living facilities.