As an Ontario landlord, it is important that you know the rules and regulations so you can navigate and thrive in Ontario’s real estate industry. Most investors work with property management companies and let them deal with the daily tasks and challenges of being a landlord.
If you don’t abide by the laws, you will find yourself facing expensive consequences, business losses, and if worst comes to worst, ending up in jail. Common landlord mistakes include failing to provide a safe environment, not setting proper expectations or disclosures, not following the proper eviction process, increasing rent illegally, violating building or fire department codes, and most of all not using the Ontario standard form of lease.
If you are unsure about what the landlord-tenant act entails, the team at Rent In Ottawa Property Management has put together this article so you can understand rights, responsibilities, and obligations as a landlord in Ontario.
What is a rental agreement? Simply put, a rental agreement, also known as a tenancy agreement or lease, is a contract between you and your tenant stating that they will pay for the agreed monthly rent in exchange for the right to occupy the rental property.
Before 2018, a specific lease form was not required to be used and all parties involved in the rental agreement were free to write their own versions of the contract.
However, effective April 30, 2018, Ontario decided to introduce the use of the standard Ontario lease agreement form as a requirement for all tenancy agreements moving forward.
However, specific rental scenarios such as the following are exempted from using the standard form of lease:
- Trailer parks or mobile home communities.
- A unit in a home care or retirement home.
- Specific supportive and social housing.
What is great about the new lease format is that it is written in an easily understandable, conversational language with minimal legal jargon. Some information that is highlighted in the agreement includes:
- The monthly rent to be paid.
- Rent due date and interval.
- What is included in the rent such as air conditioning, parking, wifi, etc.
- Specific terms and conditions during tenancy.
- Itemized landlord and tenant responsibilities.
When working with a professional property management company in Ontario, you should be assured that they adhere to the landlord-tenant guidelines and have a standard lease agreement template ready.
The Landlord-Tenant Act in Ontario
The Ontario Landlord-Tenant Act highlights the landlord’s and tenant’s rights and responsibilities once they enter the lease agreement. This is governed by the Landlord and Tenant Board to ensure that the rights and responsibilities of both the landlord and tenant are balanced and oversee the dispute resolution and regulate rent among others.
Canadian Landlord-Tenant Act in Ontario: Rights and Responsibilities
Landlords and tenants alike have corresponding rights and responsibilities under the Landlord Tenant Act. The Landlord Tenant Board (LTB) created a brochure that outlines their roles, how to reach them, and detailed landlord and tenant responsibilities and rights. To print or get a copy, you can go to the nearest LTB office, service centre, or find it online.
Understanding the Complete Ontario Landlord-Tenant Act
Residential property management and rental services, including landlords, must be knowledgeable about the rules and regulations under this act.
You must always keep a copy of all resources so they are easily accessible when needed. Make it a habit to review the updated legal documentation of the Ontario Residential Act online. Their website also includes a list of the frequently asked questions as well as explanations of the law as instituted by the Landlord Tenant Board.
Evicting a Tenant
Both landlord and tenants can prematurely end the tenancy agreement depending on the circumstances. The process will be different for the landlord and tenant. Landlords must always issue a written notice addressed to the tenants. Like the lease agreement, ending a tenancy also requires a landlord to use a specific form.
It is crucial that you are well-versed with the eviction law in Ontario as you are expected to abide by it and make decisions based on the regulation. Once all efforts have been made to salvage the situation in accordance with the act, you can now serve the eviction notice to the tenant.
If, after receiving the notice, the tenant refuses to move out, you can ask LTB to intervene and seek help in ending the tenancy. Both sides need to present their statements or arguments during the hearing organized by the Board and base their decisions on those.
A rent increase guideline is set every year except for buildings constructed on or after November 15, 2018. The 2023 rent increase guideline is at 2.5%. You can find the updated guideline here.
If you feel that the set increase percentage is not reasonable for your property, you can apply to the Landlord Tenant Board. Your request will be evaluated on specific conditions that apply to your situation.
As an Ontario landlord, you are allowed to increase the rent once every 12 months. When doing so, ensure that you provide a 90-day written notice before the rent is set to increase. Use only the official form which is available for download on the LTB website.
You are also required to pay the tenant interest on the rent deposit every 12 months. The amount of interest paid to the tenant is based on the rent increase guideline decided by the province of Ontario each year.
As a landlord, always be updated with the laws and regulations when managing your rental properties. Make it a habit to read, comprehend, and abide by the Landlord and Tenant Act in Ontario. Regardless of how simple you think the violation is, you will still be considered non-compliant and could be a reason for the board to side with the tenant.
If you need assistance with managing your rental properties and navigating the Ontario Landlord Tenant Act, reach out to the team at Rent In Ottawa Property Management today! We specialize in managing single and multi-family homes and our mission is to deliver the most attentive and fine-tuned management care possible to landlords and tenants in Canada's Capital. We look forward to working with you!