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THE VALUE PROPOSITION OF A STRONG INDUSTRY ASSOCIATION
SCOTT ANDISON
JANUARY 15, 2016
2
THE LINE UP
§ THE FRPO BRAND �
§ INDUSTRY PROFILE�
§ THE NEED FOR INDUSTRY ADVOCACY�
§ SELECT POLICY PRIORITIES�
§ QUESTIONS
FRPO—Federation of Rental-housing Providers of Ontario 3
GovernmentRela-ons&
Policy
Training&Educa-on
MemberServices&Programs
Events
Cer-fica-on&
Creden-aling
Professional industry association
Been around for over 25 years
Membership represents over 350,000 suites
Provincial-level focus
FRPO—Federation of Rental-housing Providers of Ontario 4
A strong industry association provides the ability to better manage and influence the future
Engaging government with evidence-based
policy advice and action
Education & Training
Programs
Supporting quality service delivery and
standards
Setting industry quality standards
FRPO—Federation of Rental-housing Providers of Ontario 5
Supporting Municipal Engagement Through Regional Associations
Chatham-Kent
London
Waterloo
Hamilton
Greater Toronto Area
Peterborough
Quinte
Kingston
Eastern Ontario
OttawaNorthern Ontario
FRPO—Federation of Rental-housing Providers of Ontario 6
A Federation of Resources Across Canada
FRPO—Federation of Rental-housing Providers of Ontario 7
ONTARIO’S PRIVATE SECTOR HOUSING INDUSTRY��Provides homes to over �
1.2 million households in Ontario��
$18.3 billion �in GDP annually��
Over 147,000 jobs��
$7 billion in tax �revenue to governments �
FRPO—Federation of Rental-housing Providers of Ontario 8
Private Sector Infrastructure Investment
$4.5 billion in capital expenditures on new apartment construction and renovations to existing housing
Over 42,000 full-time jobs created in new construction and repair
Invest more in rental housing than the annual capital expenditure by the Ontario government in both �
GO Transit and
provincial highways combined
Source: KPMG Rental Housing Industry Economic Impact Study, December 2013
FRPO—Federation of Rental-housing Providers of Ontario 9
For decades, the Government of Ontario has intervened in the market in an effort to resolve issues of housing affordability
§ Direct investment in hundreds of thousands of social housing units
§ Income supplements
§ Rent control
§ Prohibition on demolition and conversion of rental housing
§ Municipal authority affecting local development application approvals & fees
FRPO—Federation of Rental-housing Providers of Ontario 10
Ontario’s Rental Housing Supply Crisis
§ Competitive market for high quality rental housing
§ A market that responds quickly to changes in demand
§ A partner in the sufficient supply of affordable housing
THE INTENT
§ Aging rental housing stock supplemented by an unstable investor condo rental market�
§ Investors skeptical of long term gov’t policy regimes�
§ Shortage of housing that people can afford
THE RESULTGOVERNMENT
ACTION OVER TIME
INTRODUCED RENT CONTROL REGIMES
DIRECT INVESTMENT & MANAGEMENT OF BRICKS
AND MORTER
CREATED A PATCHWORK OF INDUSTRY POLICIES AND RULES OVER TIME
FRPO—Federation of Rental-housing Providers of Ontario 11
WHAT THE EVIDENCE SAYS
168,711 households on waiting list for an affordable home
270,000 social housing units in Ontario with a capital shortfall of
$1.2 billion
Poverty Reduction Strategy
FRPO—Federation of Rental-housing Providers of Ontario 12
DEMOGRAPHICS OF RENTERS IS SHIFTING
§ Millennials (ages 15-35) are a key part of the population seeking rental accommodation
§ Seniors are looking for specific amenities when they downsize from larger homes
0% 20% 40% 60% 80% 100%
15-24
25-34
35-44
45-54
55-64
65-74
75+
Percent Renting
Age
Gro
up
AGEPROFILEOFONTARIORENTERS
FRPO—Federation of Rental-housing Providers of Ontario 13
FRPO’S MOST COMPREHENSIVE
POLICY INITIATIVE��
Housing That People Can Afford
Tabled June, 2015
�REMOVING BARRIERS TO NEW RENTAL HOUSING IN ONTARIOJUNE 2015
14
SELECT FRPO POLICY PRIORITIES
§ Rent Control
§ Rent Dispute Process
§ Property Tax & Assessment
15
RENT CONTROL
FRPO—Federation of Rental-housing Providers of Ontario 16
RENT CONTROL
An idea that plays well with tenants and voters
But it is a policy that brings dire economic consequences
POLICYCHANGEIMPACTSONSUPPLY
POLICYISSUES
FRPO—Federation of Rental-housing Providers of Ontario 17
RENT CONTROL
POLICYISSUES
INFLATION IS PUTTING PRESSURE ON 2.5% RENT CAP
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2014 AVERAGE CPI RATE 2.4%
HARD CAP
GUIDELINEHISTORY
2015 1.6%
2014 0.8%
2013 2.5%
2012 3.1%
2011 0.7%
2010 2.1%
2009 1.8%
2008 1.4%
2007 2.6%
2006 2.1%
2005 1.5%
2004 2.9%
2003 2.9%
2002 3.9%
2001 2.9%
2000 2.6%
2014 Guideline Increase 0.8%
FRPO—Federation of Rental-housing Providers of Ontario 18
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
AVERAGE ANNUAL CPI BELOW GUIDELINE INCREASE
2015 AVERAGE CPI RATE 1.2%
2015 Guideline Increase 1.6%
RENT CONTROL
POLICYISSUES GUIDELINEHISTORY
2015 1.6%
2014 0.8%
2013 2.5%
2012 3.1%
2011 0.7%
2010 2.1%
2009 1.8%
2008 1.4%
2007 2.6%
2006 2.1%
2005 1.5%
2004 2.9%
2003 2.9%
2002 3.9%
2001 2.9%
2000 2.6%
HARD CAP
FRPO—Federation of Rental-housing Providers of Ontario 19
RENT CONTROL
POLICYISSUES
The current new development policy set out in the Residential Tenancies Act is the primary reason why new rental housing is being built
POST 1991EXEMPTION
VACANCYDECONTROL
20
RENT DISPUTEPROCESS
FRPO—Federation of Rental-housing Providers of Ontario 21
RENT DISPUTE PROCESS
POLICYISSUES
Comparison of Average Days to Resolve Landlord-Tenant Disputes��British Columbia 35�Alberta 17�Saskatchewan 25�Manitoba 32�
Ontario 90 ��
§ Eliminate the automatic stay of a Tribunal order in the event of a tenant filing an appeal�
§ Allow private bailiffs to enforce Orders as an alternative to the Sheriff ’s Office
FRPO is pursing two significant solutions with government to bring about an appropriate balance to the current dispute process
22
PROPERTY TAX& ASSESSMENT
FRPO—Federation of Rental-housing Providers of Ontario 23
POLICYISSUES
PROPERTY TAX & ASSESSMENT
How apartments are assessed§ Values are generally inconsistent
between buildings or not aligned with real market value; and
§ Policy inhibiting new rental being built
How apartments are taxed§ Property tax rates on multi-residential
buildings are generally much higher than the residential rate (houses & condos)
FRPO—Federation of Rental-housing Providers of Ontario 24
RESOLVING THE ASSESSMENT ISSUE�FRPO developed the evidence to support the need for a change in house apartment buildings are assessed and how property taxes are levied
§ Achieved a 93% reduction in administrative filing burden for owners/managers in Fall 2014
§ A significantly better assessment methodology to be implemented for the the 2017 taxation year
§ Pre-roll negotiations program to launch before the 2017 assessment rolls returned (Fall 2016)
FRPO Has Successfully Championed An Overhaul of How Multi-Residential Properties Are Assessed
Ontario’s 15,000 multi-residential buildings will now be valued on a capitalized income method starting in the next reassessment cycle
Valua-onmethodology
TRADITIONAL APPEAL RATE (including RfRs)
> 50%
FRPO—Federation of Rental-housing Providers of Ontario 25
Municipaltaxpolicy
10 The number of Ontario municipalities who tax apartment buildings the same as houses and condominiums
Apartment buildings are taxed on average at
TWICE the rate of houses and condominiums
Average over-taxation on typical 2 bedroom apartment is $85 / mth or
$1,020 per year
Property taxes are buried in the monthly rent paid by tenants
This inequity has existed for decades
1998 reform relied on municipal action to bring about equity—it is now 17 years later
Severely unfair municipal taxation practices on apartment buildings
FRPO—Federation of Rental-housing Providers of Ontario 26
SUMMARY OF OUR CURRENT ADVOCACY FOCUS
RENT CONTROL§ Maintain Post-91 Exemption
§ Remove the 2.5% hard cap
RENT DISPUTE PROCESS
§ Reduce delays in resolving cases
§ Allow use of private bailiffs
SUITE METERING
§ Extend to electrically heated units
PROPERTY TAX§ Reduce number of appeals
§ Tax fairness for tenants
MUNICIPAL LICENSING
§ Enact the previous regulation to exclude apartment buildings
FRPO—Federation of Rental-housing Providers of Ontario 27
www.frpo.org
§ Advocacy information
§ Member �bulletins
§ Reports§ Industry news§ Training & events§ Membership
programs
28
Scott Andison�President & CEOFederation of Rental-housing Providers of Ontario
tel: 416-385-1100 email: sandison@frpo.org
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