Ontario Lawmakers Set to Expand Rent Control

by | May 22, 2017 | Rental Property Management Tips

Ontario’s Ministry of Housing has announced the introduction of new legislation that, if passed, will extend rent increase limits to buildings occupied on or after November 1, 1991. Currently, these buildings are exempt from the rent cap, which is determined annually but cannot exceed 2.5 per cent.

If passed, the proposed rent increase guideline expansion will be retroactive and apply to any increases on or after April 20, 2017. The increase cap for 2017 is 1.5 per cent.

According to the Ministry, the rent control expansion is a key component to the province’s Fair Housing Plan designed to increase the availability of affordable housing. About 20 per cent of rentals, or approximately 237,000 units, will be affected by the change.

Opponents are fearful that the move will have the opposite affect by discouraging investment in condos, apartments and other rental homes. Those debating the measure before the legislature pointed out that the purpose behind the post-1991 exemption was to encourage new construction and investment into the rental housing sector in order to renew and expand housing stock. Others accused lawmakers of playing politics without considering the impact the new rules might have on landlords or the availability of rental housing.

Other changes also are included in the proposed legislation. For instance, landlords may need to adopt a “standard” tenancy agreement, and those who wish to reclaim the property for their own use would be forced to either relocate the tenants or pay a relocation fee, currently proposed as one month’s rent. In addition, above-guideline increases would not be allowed for rising utility costs. Instead landlords would be required to make buildings more energy efficient.

In a statement, the Ministry asserts that these proposed changes will create jobs and grow the economy.

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

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Disclaimer: The information provided in this post in not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

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