For the second year in a row, the provincial government has set the rent increase guideline to a limit of 1.8 per cent. Released earlier this month, the guideline – in effect from Jan. 1 to Dec. 31, 2019 – applies to most private residential units covered under the Ontario Residential Tenancies Act. This means rental units in apartment buildings, condos, houses, a room in a rooming or boarding house and basement apartments.
In terms of the 2019 guideline, here’s an example of what could happen: If you moved into your apartment on June 1, 2018 and your monthly rent is $1,000, 12 months later on June 1, 2019, your landlord can lawfully increase your rent by a maximum of 1.8 per cent. This would mean an additional $18 a month for a total of $1,018 a month for the next 12 months. However, to do so, your landlord must give you at least 90-days’ written notice before the increase takes effect, and he or she must use an N1, N2 or N3 form. Landlords can only raise the rent once in a 12-month period.
In some cases, your landlord can ask for a rental increase greater than the government limit, but can only do so under certain circumstances, and must first apply to the Landlord and Tenant Board (LTB) to get approval. Examples of asking for a larger increase include: If your landlord’s municipal taxes and charges have increased significantly; if he or she has done major repairs or renovations (called capital expenditures); if they have operating costs for security services done by people not in their employment.
Rent increases for special circumstances can’t be more than three per cent above the guideline each year. If your landlord justifies an increase that is more than three per cent above the guideline, the increase can be taken over three years – up to three per cent above the guideline per year. For increases in the cost of municipal taxes and charges, there is no limit on the amount of rent increase that can be approved.
If your landlord wants to do major repairs, renovations, buy new equipment or add a new service for your rental unit, you and your landlord could agree to a higher rent increase, but it must be done in writing. The proper form for this agreement (N10) is available from the LTB. The highest increase that can be agreed to is still three per cent above the guideline, but if you and your landlord agree to the increase, he or she does not have to apply to the LTB for approval. You have five days after signing this agreement to change your mind and tell your landlord, in writing, that you no longer agree to the rent increase.