The government of British Columbia has set the maximum allowable rent increase at three percent for next year, down from the 3.5 percent increase permitted in 2024.

Housing Minister Ravi Kahlon stated that the province's decision to tie the maximum rent increase to the rate of inflation would save tenants hundreds of dollars while allowing landlords to offset the rising costs of maintaining rental properties.

Before 2018, the maximum allowable rent increase in British Columbia was set at the rate of inflation plus two percent. The new maximum of three percent cannot take effect before January 1, 2025.

Kahlon said in a statement on Monday, "Tying the allowable increase to inflation saves tenants hundreds of dollars compared to the previous government's inflation policy plus two percent."

"While we know tenants are struggling, our rent cap protects tenants from unfair rent increases while allowing landlords to cover rising costs so that rental housing can remain in the housing market in British Columbia."

Landlords who increase rent must notify tenants three months in advance, and rent can only be increased once every 12 months.

The three percent cap does not apply to commercial rents, housing cooperatives, and some independent living facilities.

While residential landlords are bound by the rent increase cap, there are exceptions.

Landlords can make a case for higher rent increases to cover costs for building upgrades or rising interest rates under the Residential Tenancy Act of British Columbia.

In 2023, the government of British Columbia implemented a tax credit for tenants, providing up to $400 annually to low- and moderate-income renting households. The province imposed a rent freeze in March 2020 to support tenants during the COVID-19 pandemic, cancelling pending increases until July 2021.