Renting Out a Secondary Suite in BC: Landlord Basics
Quick answer: Before renting a suite on East Hill, confirm with the City of Vernon that it's permitted and built to code, then follow BC's Residential Tenancy Act: use a written tenancy agreement, keep the security deposit to half a month's rent, complete condition inspections, and stay within the annual rent increase limit (2.3% for 2026).
East Hill has plenty of homes with basements, lanes and larger lots, which makes suites a popular way to offset a mortgage or house family. Being a good landlord in BC starts with knowing the rules. Here's an overview for current and future owners.
General information only, current as of 2026. Confirm with the City of Vernon, the Residential Tenancy Branch, your lawyer and your accountant before renting.
Step 1: Make sure the suite is allowed and safe
Vernon adopted a new Zoning Bylaw 6000 on June 24, 2024, which reflects provincial housing legislation that opened the door to more homes on many residential lots. Whether a particular suite is allowed still depends on the property's zoning and the building rules.
- Check with the City's planning and building departments about zoning, permits and any parking requirements for your property.
- Ask about the suite's history if you're buying. A suite built without permits may need work to bring it up to code, which can affect insurance and financing.
- Safety basics matter: smoke and carbon monoxide alarms, safe exits, and proper separation between units.
- Tell your insurer. Renting part of your home changes your insurance needs.
If you're weighing a purchase with an existing suite, our buying in East Hill page has more on what to check.
Step 2: Understand the Residential Tenancy Act
Long-term rentals in BC are governed by the Residential Tenancy Act, administered by the Residential Tenancy Branch (RTB). The RTB publishes standard forms and a lot of plain-language guidance on gov.bc.ca.
Tenancy agreement
Use a written tenancy agreement. The RTB's standard form is a good starting point because it includes the terms the law requires.
Deposits
- A security deposit can be no more than half of the first month's rent.
- A pet damage deposit can also be no more than half of the first month's rent, no matter how many pets. Guide and service dogs are exempt.
- Once a tenant moves out and gives a forwarding address, you have 15 days to return deposits (plus any interest) or apply to keep them. Missing the deadline can mean paying back double.
Condition inspections
Inspect the suite with the tenant at move-in and move-out, using the RTB's Condition Inspection Report. You must offer the tenant at least two opportunities to inspect. Skipping this step can cost you the right to claim against the deposit for damage.
Step 3: Rent increases
- For 2026, the maximum allowable rent increase in BC is 2.3%.
- Rent can be increased only once every 12 months.
- You must give the tenant three full months' written notice using the RTB's Notice of Rent Increase form (RTB-7).
The limit is set each year, so check gov.bc.ca before issuing a notice.
Step 4: Money matters
- Income tax: Rental income must be reported, and some expenses may be deductible. An accountant can help you set things up properly, especially if the suite is in your principal residence.
- Financing: Some lenders will count part of the suite's rent when you qualify for a mortgage. Ask your lender how they treat it.
- Grants and loans: BC's Secondary Suite Incentive Program pilot took its final applications in March 2025. Check with BC Housing and your lender for any current programs before you build.
Long-term suite or short-term rental?
Some owners wonder whether they could rent the suite short-term instead. In Vernon, short-term rentals face separate rules: the provincial principal residence requirement, a provincial registration, and a City business licence. A long-term tenancy under the Residential Tenancy Act is a different arrangement with different rights and duties. Our FAQ covers common questions, and Tim Jones, a fellow agent we feature as our local East Hill expert, knows the neighbourhood's older homes well.
To see East Hill homes currently listed, including some with suites, browse the live MLS® search for East Hill homes for sale.
FAQ
How much can I charge for a security deposit on a BC rental suite?
No more than half of the first month's rent. A separate pet damage deposit is also capped at half a month's rent.
How much can I raise the rent on my East Hill suite in 2026?
The 2026 limit in BC is 2.3%, once every 12 months, with three full months' written notice on the RTB-7 form.
Do I need a permit for a basement suite in Vernon?
Check with the City of Vernon's planning and building departments. Zoning, building permits and safety requirements depend on the specific property.
Buying or selling an East Hill home with a suite? Call or text Sean at 778-363-0542, or call the Sarah AI info hotline any time at 604-227-4810.
Featured photo: stock image from Unsplash, for illustration.
