Ontario’s rent control laws establish clear guidelines to protect both landlords and tenants, ensuring fair rental terms and preventing unjustified rent increases. For landlords, understanding these laws is crucial to avoid legal issues and maintain long-term, successful rentals. Here’s what every landlord in Ontario needs to know about rent control laws:
1. Residential Tenancies Act (RTA)
The Residential Tenancies Act (RTA) is the primary law governing the relationship between landlords and tenants in Ontario. It sets boundaries on rent increases, tenant rights protection, and eviction procedures.
- Rent Control: In Ontario, landlords cannot raise rents arbitrarily. There is a specific legal framework that defines when and how much rent can be increased.
2. Rent Increases
Under Ontario law, landlords can increase the rent, but there are certain rules they must follow:
- Rent Increase Limits: Rent can only be increased once every 12 months, and the amount of increase is set by the government each year.
- Notice Requirements: Landlords must provide tenants with at least 90 days’ notice of a rent increase using Form 1 – Notice of Rent Increase. The notice must include details of the new rent and the date it will take effect.
- Increase Limits: For 2025, the maximum allowable rent increase is 2.5%, which is below inflation.
3. Exceptions to Rent Control
While rent control laws apply to most cases, there are exceptions:
- New Builds: If a building was constructed after 2018, rent control does not apply to these units. This means landlords can freely set the rent for new tenants, but only for the first tenant after construction.
- Major Renovations: If a building undergoes extensive renovation (verified by proper certification), landlords can increase rent beyond the standard limits.
4. Landlord Rights and Responsibilities
Landlords should be aware of their rights and obligations under the law:
- Deposit Requirements: Landlords can ask for a deposit, but it cannot exceed one month’s rent.
- Repairs and Maintenance: Landlords are responsible for maintaining the property in a habitable condition, which includes making necessary repairs to keep the property safe and functional.
- Right to Enter the Unit: Landlords can enter the unit but only in certain circumstances and with proper notice to the tenant. A minimum of 24 hours’ notice is required unless it’s an emergency.
5. Eviction Laws
Although Ontario’s rent laws are designed to protect tenants, there are circumstances where landlords may need to evict a tenant:
- Non-payment of Rent: If a tenant fails to pay rent, landlords can apply for eviction.
- Breach of Lease: If a tenant violates the terms of the lease, such as failing to maintain the unit or causing noise disturbances, landlords may request eviction after giving proper notice.
- Eviction for Other Reasons: A landlord may request eviction if they want to use the unit for personal use (e.g., for family members), but they must follow the legal process and give notice.
6. Assistance and Resources
If landlords have difficulty understanding the laws or need help resolving issues, they can refer to the following resources:
- Ontario Ombudsman: Provides assistance with issues related to tenant rights.
- Local Real Estate Lawyers: Can help clarify specific cases and offer legal advice.
- Tenant Advocacy Organizations: Assist landlords in building positive relationships with tenants and resolving disputes.
Conclusion
Ontario’s rent control laws provide clear guidelines to protect tenants’ rights while offering fair conditions for landlords to grow their rental income. Understanding these laws helps reduce the risk of legal problems, allows for efficient property management, and prevents unwanted situations.
