Lawmakers in Ontario have made good on a promise to tamp down skyrocketing rent by proposing an expansion of the rent increase guideline.
A new bill, The Rent Protection for All Tenants Act, 2017, would require landlords with newer buildings to follow the annual rent increase guidelines set out in the Residential Tenancies Act.
Currently, the rent increase guideline does not apply to residential units first occupied on or after November 1, 1991. If passed, the bill would repeal that exemption and apply rent increase caps to those units.
The rent increase guideline figure is set annually based upon economic indicators. The number represents the maximum amount rent can be increased without seeking approval from the Landlord and Tenant Board for a higher increase. The 2017 guideline is 1.5 percent. By a recent amendment, the annual figure can no longer exceed 2.5 percent, regardless of economic factors.
Ontario’s Housing Minister has indicated that he may support the measure, but at the same time, lawmakers note that debate will continue over any concessions that should be offered to landlords. Possibilities that have been raised by landlord advocates include relief from municipal taxes within Toronto, lower regulatory costs, and greater ease in evicting problem tenants.
Opponents argue that the measure may have a chilling affect on investors, which will compound the problem of low inventory. Others say that the measure seeks to blame landlords for the housing crisis, when the province could create more inventory simply by allowing secondary suites in owner-occupied properties.
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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.