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In December, 2009, the British Columbia government made a very significant amendment to the Strata Property Act. This amendment gives developers the ability to create strata projects where all owners of residential units, regardless of when they purchase their units, have the unrestricted right to rent out their units. Let me explain.
The Strata Property Act provides that, if a developer wishes to rent any of the residential strata lots in the project, the developer must file a document called "Rental Disclosure Statement" with the Superintendent of Real Estate. This document requires the developer to do two things: (i) specify the residential units that the developer intends to rent out, and (ii) specify the length of time the developer is to be entitled to rent out those units. In order to ensure that they have the ability to rent out residential units should they wish to do so, most developers do file a Rental Disclosure Statement (RDS) with the Superintendent of Real Estate.
The December, 2009 amendment to the Strata Property Act does not change the law regarding rental restrictions for projects where the developer filed a RDS before January 1, 2010. For these projects, the legal effect of the RDS is that only (i) the developer, and (ii) "first purchasers" (these are owners who purchased their units directly from the developer) are exempt from any rental restriction bylaws passed by the owners until the date the RDS expires. All purchasers subsequent to the "first purchasers" are subject to any rental restriction bylaws passed by the owners from time to time.
The December, 2009 amendment to the Strata Property Act changes the scope of the exemption that a RDS can provide. The amendment states in effect that, for a RDS filed after December 31, 2009, any rental restriction bylaws passed by the owners do not apply to any of the strata lots specified in the RDS until the date it expires.
In other words, if a developer files a RDS indicating the developer intends to rent all of the residential units in the project, and that the RDS expires in 100 years, the practical effect of the RDS will be that, for the entire life of the building, all owners of residential units, regardless of when they purchased their units, will be entitled to rent their units as they see fit, free of any rental restrictions.
Legal update provided by:
David A. Liden BA, LL.B
Solicitor
REMEDIOS
and COMPANY,
Barristers and Solicitors
Tel: 604-688-9337
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