The government has announced that the rent control guideline for 2016 will be 2.0%, up from the 2015 guideline of 1.6%. The 2016 guideline applies to rent increases between January 1 and December 31, 2016.

The guideline does not apply to vacant residential units or residential units first occupied on or after November 1, 1991.

The interest rate on last month’s rent deposits also changes in accordance with the Residential Tenancies Act which requires interest to be paid to the tenant annually at a rate equal to the guideline. Note that landlords will be able to use the interest earned on a last month’s rent deposit to top up the tenant’s last month’s rent deposit, as required, to keep this deposit up-to-date with the current monthly rent.

Increasing Your Rent by the Guideline

The rent for a unit can be increased up to the guideline limit if at least 12 months have passed since a tenant first moved in, or if at least 12 months have passed since the last rent increase.

A tenant must be given proper written notice of a rent increase at least 90 days before the rent increase takes effect. The written notice should be on the N1 Form, “Notice of Rent increase”, available from the Landlord Tenant Board website, www.ltb.gov.on.ca, under the section “Notices of Rent Increases”. There is no requirement for approval by the Landlord Tenant Board.

The guideline is based on the Ontario Consumer Price Index, a measure of inflation calculated monthly by Statistics Canada that reflects economic conditions over the past year.
The Residential Tenancies Act, 2006 limits rental increases at a maximum of 2.5 per cent for buildings constructed prior to 1991 and ensures equitable consideration for families renting homes, and landlords trying to cover operating costs.
Providing Ontarians with affordable housing is part of the government’s economic plan for Ontario. The four-part plan includes investing in people’s talents and skills, making the largest investment in public infrastructure in Ontario’s history, creating a dynamic, innovative environment where business thrives, and building a secure retirement savings plan.
QUICK FACTS
·         The rent increase guideline applies to most private and residential rental accommodations covered by the Residential Tenancies Act, 2006.
·         The guideline is not applicable to: vacant residential units, residential units first occupied on or after November 1, 1991, social housing units, nursing homes or commercial property.