Ontario Rent Control Exemptions for Units First Occupied After November 15, 2018

As a property manager or landlord in Ontario, it is important to be aware of the regulations and laws surrounding residential rent increases. One key aspect that landlords and property managers should be familiar with is the exemption of new buildings from rent control in Ontario. 

Under the Residential Tenancies Act, residential buildings or homes that were occupied for the first time after November 15, 2018, are exempt from rent control. For these new homes, landlords or property managers can increase rent at any amount and may disregard the limitation of the annual rent increase guideline, as set by the government. However, any increase should still reflect the current lawful or market rent and notice must still be provided at least 90 days in advance. 

Note: To increase rent above guideline for a home first occupied after November 15, 2018, landlords must use Form N2, rather than the typical Form N1. 

While these exemptions were enacted back in 2018, many landlords and tenants are still growing accustomed to the practice. In early 2020, the Ontario government passed legislation to freeze residential rent and prohibit rent increases until December 31, 2021. Along with this, significant rises in market rent were noted in 2022. As such, some landlords and tenants may be finding their rent increasing substantially as we go into 2023. 

With ever-increasing interest rates, landlords may find this to be a necessary relief, though tenants may find the opposite in the case of a significant increase. It’s necessary that both parties weigh their options. For landlords, the costs associated with finding a new tenant may overshadow the benefits of a total, up-to-market increase. 

It is crucial to stay up-to-date with the latest regulations and laws surrounding residential rent. Understanding the exemption of new buildings or homes from rent control in Ontario is just one aspect of effective property management. By staying informed and keeping a professional approach, property managers can help ensure the success of their clients’ investment properties.