The provincial government is scrapping the rental increase formula and lowering the maximum annual allowable rent increase to the cost of inflation only.

"Renters have told us that they are hurting and they need help today," said Housing Minister Selina Robinson.

Existing regulations allow landlords to raise rents by the cost of inflation plus two per cent, but earlier this week a task force recommended eliminating the two per cent add-on.

That recommendation, plus another tabled by the task force which would allow landlords to apply for additional rent increases to cover maintenance and repair costs, was accepted Wednesday by cabinet.

The province is capping maximum allowable rent increases at cost of inflation only, dropping the two per cent add-on that was previously allowed. (Darryl Dyck/Canadian Press)

Earlier this month, there was an outcry when it was announced that the 2019 maximum allowable rent increase would be set at 4.5 per cent — 2.5 per cent for the cost of inflation plus two per cent — which would have constituted the biggest increase since 2004.

"That's just not acceptable," said Premier John Horgan. "We're looking at a million and a half renters facing a 4.5 per cent rent increase when their wages haven't increased even close to that."

With Wednesday's announcement, the maximum increase allowed in 2019 will be 2.5 per cent.

The premier said the rental housing task force will be making more recommendations in the weeks ahead.

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