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The B.C. government is capping rent increases in the province at the rate of inflation, a move that will drastically cut the maximum annual rent hikes that had been allowed under the old formula.

The province dropped the automatic two per cent increase in annual rental costs for renters around the province, starting next year.

The increase will now be limited to the annual rate of inflation, which now stands at 2.5 per cent.

This comes on the heels of recommendations from the Rental Housing Task Force to limit rental increases to the inflation rate alone.

The maximum rent increase that was allowed for next year, under the current formula, was 4.5 per cent.

READ MORE: Task force recommends smaller rent increase limits for 2019

Landlords will still be able to apply for higher amounts if they prove they are maintaining or upgrading units.

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Again this will go into effect next year.

Earlier this year, BC gov passed 4.5% rent hike (annual increase plus rate of inflation) Next year, rent will rise by inflation which is 2.5% https://t.co/3BXWapKmGX — Emily Lazatin (@EmilyLazatin) September 26, 2018

Premier @jjhorgan : "We need to bring in more supply that is affordable to British Columbians…the task force will continue to consult and we will continue to work with landlords to make sure we can bring in more supply" https://t.co/OroeFK36C9 — Emily Lazatin (@EmilyLazatin) September 26, 2018

“It’s simply not sustainable for renters, many of whom are on fixed incomes, to see their rent increase by more than inflation each and every year,” said Premier John Horgan in a media release.

“We have to eliminate the risk of such huge increases for renters. Our new approach strikes a balance between giving relief to renters while encouraging people to maintain their rental properties.”

As a result of eliminating the additional 2 per cent increase, the government says people living in a $1,200 per month apartment, which is the average rent in B.C., could save up to $288 in 2019 over what they could have paid under the old formula.

People in an average two-bedroom apartment in Vancouver could have faced paying up to $432 more over the course of the year.

“We recognize supply is key to bringing down rental costs in the long term, but renters have told us they are hurting and need help today,” said Selina Robinson, Minister of Municipal Affairs and Housing in a release.

“That’s why we are taking careful steps to address the housing crisis and ease the pressure on renters, while also making sure that landlords have the tools they need to continue to invest in their rental properties.”

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The opposition BC Liberals have attacked the move, which they say will penalize landlords and make it difficult to maintain aging, affordable rental units.

“Landlords are now being told that when they need to do maintenance and renovations they will have to apply to the government to be able to afford it,” said Kamloops-South Thompson MLA Todd Stone in a statement.

“The arduous bureaucratic process to approve them will result in landlords having little incentive to renovate ageing housing stock in cities like Vancouver and Victoria.”

However, BC Green Leader Andrew Weaver and Adam Olsen, Rental Housing Task Force (RHTF) member, applauded the government’s move.

“The lack of affordable rentals has wide-ranging impact in every corner of society, from seniors on fixed income, to young people and students, to small businesses struggling to find employees,” said Olsen in a release.

“I believe this policy strikes the right balance of encouraging affordable rents while giving landlords the ability to apply for justified higher increases. I look forward to releasing the rest of our recommendations soon so that we can continue to deliver on our shared promise to address the affordability crisis.”