How does rent control work in Ontario, and does it apply to you?

If you happen to’re speaking about renting in Ontario, chances are high there’s one time period that comes up over and over: hire management.

However what does that really imply, and the way does it work? Maybe most significantly, does it apply to your condo?

Right here’s what you could know:

Any condo, home, apartment, basement or cell residence that somebody has lived in since earlier than Nov. 15, 2018 is roofed by hire management. That doesn’t imply hire can’t go up. It signifies that hire could be elevated every year and the provincial authorities decides by how a lot. 

In 2023 and 2024, hire will increase have been set at a most of 2.5 per cent a month. Which means if you happen to’re renting an condo for $1,500 and it’s underneath hire management, a most enhance would see you pay an additional $37.50 for a brand new month-to-month whole of $1,537.50.

Straight ahead sufficient, proper?

Not so, explains Bruno Dobrusin of the York South Weston Tenant Union. It’s not that easy.

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“There are a lot of holes in that system,” Dobrusin mentioned. “That’s essential to grasp as a result of that’s the origin of a variety of the issues that tenants have.”

Let’s check out  a few of these “holes” he’s speaking about.

I’ve lived in my unit since earlier than 2018, can my landlord increase the hire?

Brief reply: sure.

As talked about, hire management means landlords are allowed to boost hire by a pre-determined quantity annually. However there may be one other method they’ll increase hire past what’s sometimes allowed.

In technical-speak, that is referred to as an above guideline hire enhance, or AGI. With approval, landlords can bump hire up one other three per cent per 12 months.

To try this, the owner has to persuade the province why they need to be allowed to boost your hire above the rent-controlled 2.5 per cent. The province provides your landlord three choices from which to argue their case: 

1. Their metropolis taxes have gone up by what the province calls an “extraordinary” quantity. 
2. They’ve to pay for safety for the primary time, or the price of safety has gone up. 
3. They’re paying for renovations. 

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The shape landlords fill out to use for these will increase asks them for info explaining how a tax enhance impacts their rental items. The province defines taxes as extraordinary in the event that they value greater than 50 per cent of the rule.

In the meantime, Dobrusin says a standard arguments landlords in Toronto use to boost hire is balcony renovations.

“One of many huge issues with [these applications] that frustrates tenants is that many tenants have problems with repairs inside their items and landlords don’t reply to this,” he mentioned. “However they continually apply for these functions that have been presupposed to be distinctive.”

In 2022, CBC Toronto discovered 5 rental properties across the metropolis the place homeowners utilized for 5 or extra of those additional will increase to pay for repairs or renovations within the final decade. 

I’m transferring into an outdated condo, will I be underneath hire management? 

This reply is a bit of trickier. 

In case your condo has been round since earlier than Nov. 15, 2018, it’s hire managed. 

However that doesn’t imply you’re assured the identical candy deal the earlier tenant had. That’s due to one thing referred to as emptiness deregulate, which advocates, metropolis councillors, and the official opposition have referred to as on the Ontario authorities to dispose of a number of occasions lately. Nevertheless, the PC authorities has rebuffed these makes an attempt.

A spokesperson for the ministry of municipal affairs and housing mentioned permitting landlords to convey vacant items to “market ranges” encourages them to spend money on their properties and protects towards the lack of leases within the province.

“A part of what I believe emptiness deregulate does is it undermines hire management,” mentioned Nemoy Lewis, an affiliate professor on the Faculty of City and Regional Planning at Toronto Metropolitan College.

Emptiness deregulate means a landlord can enhance the hire nevertheless a lot they need on a vacant condo, even when it was first occupied earlier than the hire management cutoff date. Lewis says it could make landlords need to transfer one tenant out so one other, who can afford to pay extra hire, could be moved in.

“What it’s basically executed has made the market considerably costlier,” he mentioned.

So, how would possibly emptiness deregulate affect you?

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Let’s say the earlier tenant paid $1,500 a month.

As soon as they transfer out, the owner can increase the value to no matter they need, maybe to $2,500. The condo is hire managed on the increased worth similar to on the lower cost.

Which means as a substitute of an additional $37.50 a month for a 2.5 per cent most enhance, you’re paying about $62.50 as a result of the beginning hire is increased.

I’m transferring into an condo constructed after late 2018, am I underneath hire management?

No. 

Any rental unit constructed after Nov. 15, 2018, shouldn’t be topic to provincial hire management. That doesn’t simply imply a brand new condo constructing, it additionally contains additions to current buildings or an unfinished space like a basement or attic that’s been transformed into an condo. 

How typically can my landlord enhance my hire?

Landlords can increase your hire each 12 months, both 12 months after the final enhance or 12 months after you moved in. They do, nevertheless, want to present you no less than 90 days discover earlier than charging you extra.

This is similar no matter whether or not your unit is rent-controlled or not.

What do I do if me and my landlord have a disagreement about hire management?

The official solution to take care of a dispute together with your landlord could be the Landlord and Tenant Board. The one tribunal in Ontario that offers with points between renters and property homeowners. Nevertheless, it’s present state of operation is lower than ultimate.

In Could, Ontario’s ombudsman mentioned the board has a backlog of greater than 38,000 functions.