Ontario's rent increase guideline and how it works

If you own or manage rental property in Ontario, the rent increase guideline is one of the few numbers you cannot afford to get wrong. Raise rent above what the rules allow and the increase can be challenged.

This is a plain walkthrough of how the guideline works, how much notice you owe, and which units fall outside it. No jargon, just the rules as the province sets them out.

How much can a landlord raise rent in Ontario?

That single percentage is the starting point for almost every rent increase conversation in the province, so it is worth understanding what sits behind it.

What is the rent increase guideline?

It is the maximum percentage a landlord can increase rent in a year without applying to the Landlord and Tenant Board for approval.

Ontario publishes the guideline annually. It applies to most private residential rental units covered by the Residential Tenancies Act, 2006. The percentage is the same for everyone it covers in a given year, and it applies to the rent the tenant is currently paying.

• It is a cap, not a requirement. A landlord can raise rent by less than the guideline, or not at all.
• It is set by the province. You do not negotiate it, and you cannot exceed it for a covered unit without going through the proper process.
• It changes each year. Always confirm the current year's figure on Ontario's official website before issuing a rent increase notice.

How often can rent be increased, and how much notice is required?

Rent can generally be increased once every 12 months, and the landlord must give at least 90 days written notice.

There are two timing rules that work together. The rent for a unit cannot be raised more than once in any 12 month period, and the tenant must be told in advance using the correct form. Skip either step and the increase may not be valid.

• The 12 month rule. At least 12 months must pass between increases for the same tenant.
• The 90 day notice. The landlord must give written notice at least 90 days before the new rent starts.
• The proper form. Notice must be given in writing on the form required under the Residential Tenancies Act.

Are there units the guideline does not cover?

Yes. Some units are exempt from the guideline, most notably newer rental housing.

The Residential Tenancies Act sets out which rentals fall outside the guideline. The widely known exemption is for units that were first occupied for residential purposes on or after November 15, 2018. For those units, the guideline cap does not apply in the usual way, though other rules under the Act still do.

• Newer units. Rentals first occupied on or after November 15, 2018 are generally not covered by the guideline.
• Other categories. Certain other unit types are also treated differently under the Act. Confirm your specific unit before assuming the guideline applies.
• When in doubt, verify. The exemption rules are detailed, so check the legislation or the Board for your situation.

The percentage above is a made up figure used only to show the math. Always use the real published guideline for the year your increase takes effect.

What happens if a landlord gets it wrong?

An increase that breaks the rules may be invalid, which can leave the rent where it was.

The point of the guideline, the 12 month rule, and the 90 day notice is predictability for both sides. If you raise rent by too much, too often, or without proper written notice, a tenant can dispute it. That can mean the increase does not take effect, and you may need to refund overpayments. Getting the process right the first time is far cheaper than fixing it later.

Frequently asked

How much can a landlord raise rent in Ontario?

For most rental units, a landlord can raise rent by no more than the annual rent increase guideline set by the province for that year. The guideline percentage changes each year, so check the current figure on ontario.ca before issuing a notice.

How often can a landlord raise the rent?

Rent can usually be increased once every 12 months. The landlord must give at least 90 days written notice using the proper form before the increase takes effect.

Are any units exempt from the rent increase guideline?

Yes. Units first occupied for residential purposes on or after November 15, 2018 are generally not covered by the guideline, along with certain other unit types. The Residential Tenancies Act sets out which rentals are exempt.