Tenants in Nova Scotia who feared an imminent end to the rent increase cap may welcome its extension, although it will be raised in less than a year.

Tim Houston's government in Halifax announced on Tuesday the continuation of the residential rent increase cap until December 31, 2025, but this cap, currently set at 2%, will be raised to 5% starting January 1, 2024.

For example, a current monthly rent of $1,500 will increase at the beginning of next year to a maximum of $1,575.

By raising this maximum increase, the Progressive Conservative government in Nova Scotia is trying to balance the rights and needs of tenants on one hand, and those of landlords on the other, says the province's Minister of Internal Services, Colton LeBlanc.

The government also estimates that about one-third of Nova Scotia's residents are tenants and that the province has about 6,000 people who own rental homes.

It is worth noting that the 2% maximum increase limit began to be enforced in November 2020.

Minister LeBlanc pointed out that it was the previous Liberal government that set the increase cap at that time, at the height of the COVID-19 pandemic, while many people were unable to work due to public health measures.

It is also noted in this context that the annual inflation rate in Nova Scotia reached 6.5% last February, down from 6.9% in January. Across Canada, the rate was 5.2% last month, down from 5.9%.

Tim Houston's government's decision means that the next general election in Nova Scotia will be held while the rent increase cap is still in effect. Residents of the province will head to the polls in July 2025.

In response, Tim Allenby, vice president of the Nova Scotia branch of the Canadian "Association of Community Organizations for Reform Now" (ACORN), welcomed the extension of the rent increase cap and that it is lower than the inflation rate in the province. The mentioned association advocates for tenants' rights.

However, Allenby added that low-income tenants need better long-term protection.