Ontario Landlords Association

The 2013 Ontario Rent Increase Guideline is 2.5%

June 23nd, 2012

How Much Will I be Able to Raise the Rent in 2013?

The guideline for 2013 is 2.5 per cent.  For example, if the rent is $1,000 the amount you can increase the rent is $25.

How Was this Increase Calculated?

In Ontario the yearly Rent Increase Guideline is a calculation based on the Ontario Consumer Price Index.  This Index is managed the federal government’s Statistics Canada.

With All the Increases in My Costs, It Feels Too Low

The amount should have been 2.6% except there is a recent new law capping annual increases in Ontario to a maxium of 2.5%

Even 2.6% Is Too Low for Me to Recover My Costs

Agreed.  There is a lot of debate going on amongst landlords regarding changing the rent increase formula to add more weight to costs landlords’ face.  This issue has already been brought up by the OLA to MPPs and candidates in ridings across Ontario.

What Types of Property Does the Guideline Cover?

The Ontario Rent Increase Guideline applies to most of the  private residential rental accommodation covered by the Residential Tenancies Act, 2006 (RTA).

It’s important to note this guideline does not apply to

  • Residential units which are vacant
  • Residential rental units first occupied on or after November 1st, 1991
  • Units which are Social housing units
  • Units which are used as Nursing homes
  • Commercial properties

How Do I Give My Tenants a Rent Increase?

Usually the rent for a unit can be increased if the following situation exists.  At least 12 months must have passed since a tenant first moved in, or, if at least one year has passed since the last rent increase.

Please note, your tenants must be given proper written notice of a rent increase.  Proper notice means at least 90 days before the rent increase takes effect.

Can You Provide Me With a Clear Example?

Let’s say the monthly rent for your house is $1,000 beginning August 1, 2012.

With proper notice (written 90 days notice to the tenant), you could lawfully increase the rent 12 months later on August 1, 2013.

Let’s put that another way:

  • The Ontario guideline for 2013 is 2.5%.
  • The rent increase is 2.5% of $1,000 = $25.
  • This means the new rent on August 1, 2013 could be up to $1025 ($1000 + $25).

You find out more and add your opinions in the Ontario Landlords Advice Forum.

 

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20 Responses to “The 2013 Ontario Rent Increase Guideline is 2.5%”

  1. Hui says:

    That’s interesting why government tells the landlord how much to increase the rent?

  2. Daniel Koldyk says:

    The above article notes that there are several exceptions to the RTA (2006) when it comes to raising rent. The second exception states: “Residential rental units first occupied on or after November 1st, 1991″. Does that mean that all apartments that went on the market after that date can raise the rent above 2.5%? If yes, is there another limit? Grateful if someone can provide an answer.

  3. Ken says:

    So, what you’re saying is that the government dictates how much the landlord will lose out on?

    That makes sense because a government official can charge the equivalent of $16 for a glass of orange juice to the tax payer! To add insult to injury on the tax payer the same government official still gets a full pension regardless?

    Government = win win and People = lose lose! I hope the government realizes that this dictatorship can’t go on forever and regardless of how many soldiers, tanks and guns they have people will put this BS to an end!

  4. David says:

    The province often works against the interests of landlords to garner votes with tenants. Two years ago the province allowed a .7% increase the same year the HST was adopted in Ontario raising many input costs by 8%. Fair? No. Election year? Yes. The government is a very slow learner when it comes to these things.

  5. Sue says:

    I telephoned the Rental Tribunal to ask if there has been a decision yet on what the 2013 rent increase will be and the associate said not yet. Meanwhile, I stated to her that the website is ambiguous/confusing and this associate said it was not. I argued that it IS confusing, because the website specifically states “The 2013 Ontario Rent Increase Guideline is 2.5%”, and she argued that the decision is not yet final. Which is it ?????

  6. anne cooke says:

    Hello if I give notice now for increase Jan. 1,2013 should I use the 2012 or 2013 amount?

  7. Tom says:

    Quick question I hope you know the answer to.

    If I have a tenant that i haven’t raised rent on for several years, how much of a rental increase can I put through. Can I put 2 years of increases together?

    For Example:
    In 2012 the increase was 3.1%, in 2013, it will be 2.5%. – If I haven’t raised rent on a tenant in 3 years, can I move it up 5.6% in 2013? Or am I limited to the current year amount.

  8. Daniela says:

    Tom, apparently you can only increase the rent by the yearly increase, I called and asked. Anne Coook, if you are giving notice now, the increase will take effect in 2013, therefore you must use the 2.5% for 2013 guidelines…I know it is terrible!

  9. Ben says:

    Can the rent on a 3-year lease be increased, say 2 years after the tenant moved in? Since the guideline does not say no, it seems that it is allowed. Correct or not?

  10. Ron #2 says:

    I dont understand how the rate is calculated based on the CPI. The current rate of inflation is only 1.3%, yet i received notice that the rent is increasing 2.4% for 2013.

    Can someone please explain?

  11. Rob says:

    Just looking up some stats. The province of Ontario has a CPI of 1.0% in 2012 yet the price goes up by 2.5%. Gee…it’s nice to be on a pension that only goes up by the CPI amount which my company assured me would let me keep up with the cost of living. Every year I get further and further behind. Soon I’ll be out on the street.

    http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/cpis01g-eng.htm

  12. rosa says:

    I agree that the government should increase a set rent for the land lords to pass onto tenants, because if not for this, the landlords would raise as they please, leaving the tenants in a struggle with an even tighter budget.

  13. Me says:

    CAPREIT continues to increase rent ABOVE the Ontario minimum. They have NOT done any work to my apartment or the outside grounds.
    How would I found out WHY they choose to increase the rent every year WAY ABOVE the usually guidelines?

    Thanks

  14. to me says:

    You need to call the rental board if they increase it above the minimum amount and ask them. I had a friend who received a letter that said her rent was increasing significantly because they were doing reno’s even though the building was brand new. She called the board and they said the company has to do that but you don’t have to pay, so she called the rental office and her rent stayed the same, but many people in her building moved out after the letter – which is what the rental office wanted cause now they could charge much higher rents then what the people were paying. It always pays to call the rental board.

  15. WOODY says:

    I live in a building thats 42 years old and my apartment hasnt seen any upgrades in 42 years. Old kitchen, Old bathroom etc etc. there is 150 units in this building so averaging an increase of 20 dollars a month for each unit thats 3000 a month times 12= 36000 up above the month rent they have 6 people employed to look after this building and its ridiculas cause they contract the outdoors and painting and drywall and electrical and thier boiler maintenance.These people get free aptments and a salary for vacuming and window washing.thats. I wonder what realstar managements yearly salaries for exects in Toronto are and thats why the governments caps rental increases so fat cats stay lean and dont have a chance to stiff the renters

  16. Denise says:

    What these fat cat landlords and our government apparently does not realize is that the tenants also have increased expenses.Higher food costs,transportation,education,utilities etc.and in many cases their wages have not increased and may have even decreased do to hours of work cut lay offs ,job loss etc. Wake up people, or there could be alot more homeless without strict guidelines for rent increases. Frankly 2.5 is too high for many struggling tenants.

  17. Kelly says:

    What happens if the landlord does not provide 90 days written notice? Are they still legally allowed to increase rent?

  18. cw says:

    My apartment is one of three in an older broken down house. The entire house is just over 1200 square feet. Nothing has been done for years not to mention that the hydro, gas and cable, which are all included in the rent have been disconnected several times due to non payment of bills. This landlord has several income properties…all of which are high quality condos in and outside Canada. Someone tell me why I should pay ANY increase to this deadbeat?

  19. Betsy says:

    It should be very simple if the landlord does not carry out maintain on the property then why allow a them to charge a rent increase. Nothing has changed for the landlord, no out of pocket expenses, no increased costs, most time they don’t even pay the utilities.

  20. Mel says:

    I just received a notice of rent increase, double that of the guidelines, applicable 90 days from the date stamped on the letter. My original one year lease ends in 90 days. Standard Tenant Agreements in Toronto state that following the term of the contract, the tenant rents on a month to month basis (with 60 days notice of termination from that point forward). The letter from my landloard states the new lawful rent and the discounted rent. However, they are stating that the discounted rent will only apply if I sign another 1 year lease. I have paid for my past year of rent with post-dated cheques and I therefore do not understand the reason for retrieving the discount. Is this within their rights? I’ve been renting for a number of years and have never had this happen. All landloards have granted me the discounted rate even on the month to month basis following the 1 year lease.