Employment Law

Some Important Issues Regarding Rent Increases in Ontario?

Depending on some factors, the amount of rent can be charged by a landlord. Under the law (Residential Tenancies Act), the amount of a tenant’s rent can be increased once every 12 months. The landlord has to give 90 days of written notice to the tenant to increase the amount of rent. Depending on whether the tenant is paying the maximum amount of rent allowed for the rental unit, the increase can be applied. To increase above the annual limit, a landlord can apply to the province’s Landlord and Tenant Board. It may lead to covering a rise in municipal taxes.

For 2020, a landlord can only increase the residential amount of rent by 2.2%. It applies to most private residential rental accommodation. It should be emphasized that the guideline does not apply to vacant residential units. Also, it does not apply to:

– Social housing units

– Commercial property

–  A rental unit first occupied after November 15, 2018(for residential purposes)

– Nursing homes

There is no limit for annual rent increases for the mentioned units.

Some amendments to the Residential Tenancies Act were made by the Rental Fairness Act On May 18, 2017. The changes which are regarding rent increases and maximum rent include:

–   For existing tenants, annual rent increases should not be higher than the rate of inflation.

–   If the rate of inflation is higher, the rent increases must be capped at 2.5 percent

–  Rent control applies to all private residential rental accommodation. It does not matter the rental unit first occupied on or after November 1, 1991.      Keep in mind that if a unit first occupied on or after November 1, 1991, there is not any limit on how much the landlord can increase the rent. However, for new housing units, it isn’t applied.

– For buildings where elevator work orders have not been completed, the above-guideline cannot be applied.

Can landlords raise the rent above the guidelines?

All landlords can apply to the province’s Landlord and Tenant Board to approve a rent increase above the annual limit only if:

– the operating costs related to security services in the rental unit increased

– the costs for municipal taxes or utilities have increased by more than the guideline plus 50% ( the costs can be related to heat, water, and electricity)

– the landlord had the right to significant renovations, repairs, replacements, or new additions to the rental unit.

What Are the Rules for New Rental Units Occupied for the First Time?

For new housing units that have been occupied for the first time after November 15, 2018, rent control rules are not applied. These rules can apply to newly built units and new basement apartments. They can also apply to the tenants who have tenancy agreements entered into on or before November 15, 2018.

All tenants can get a rebate by applying to the Landlord and Tenant Board if the landlord charges illegal rent, including charging more than the maximum amount or applying raises to the rent more than once every 12 months. For getting a rebate, you can fill out forms requesting a hearing with the Board office. If you need any help with making an application, contact an experienced paralegal in Toronto.