Limits on Rent Increases … It Depends

Can a tenant’s rent be increased without the Landlord and Tenant Board’s approval?

Generally, landlords may only increase the rent without the Board’s permission only once every 12 months where:

  • the of amount of the increase is within the Board’s guideline amount; and
  • a notice has been given to the tenant on a Board approved form; and
  • the notice is given to the tenant 90 days before the increase is to take effect.

If these conditions are not met, the landlord must obtain approval from the Board.

What many tenants are not aware of are certain exceptions.

Exception 1 – If the rental unit was built before 1998 and was not used for any purpose OR if the unit was built after 1998.1

For example, a rental property was built in 2007.  The landlord applied for an above guideline limit increase.  The Board stated that the landlord’s application was unnecessary because the building was built after 1998, and was, therefore, already exempt.2

Exception 2 – If the rental unit has never been rented since 1975.3

Exception 3 – If the rental unit is in a building that was built after 1991.4

For example, a landlord applied for an order requiring the tenant to pay the rent that she owed. The tenant produced a letter that purported to verify with the tenant that the rental payments would remain fixed as long as she occupied the unit. The landlord gave un-contradicted evidence that the residential complex was constructed in 1994. The Board ruled that “the Landlord’s increase is lawful.”5

Exception 4 – If the rental complex has never been used for rental purposes before 1991.4

For example, a landlord applied for a rent increase above the guideline. The tenant complained that the increase requested was far above the guideline. The Board found that the unit was first used for renting in 1993. The Board ruled that the landlord was entitled to the increase in rent that he was requesting.6

NOTES

1.     Residential Tenancies Act, 2006, SO 2006, c 17, s. 6(2)(a)

Sections 104, 111, 112, 120, 121, 122, 126 to 133, 165 and 167 do not apply with respect to a rental unit if, it was not occupied for any purpose before June 17, 1998.”

2.     TNL-22811 (Re), 2009 CanLII 74526 (ON LTB)

“… a rental unit is exempt if it has not been occupied for any purpose before June 17, 1998. The rental property in question falls within this exemption.”

3.     Residential Tenancies Act, 2006, SO 2006, c 17, s. 6(2)(b)

Sections 104, 111, 112, 120, 121, 122, 126 to 133, 165 and 167 do not apply with respect to a rental unit if, it is a rental unit no part of which has been previously rented since July 29, 1975.”

4.     Residential Tenancies Act, 2006, SO 2006, c 17, s. 6(2)(c)

Sections 104, 111, 112, 120, 121, 122, 126 to 133, 165 and 167 do not apply with respect to a rental unit if, no part of the building … was occupied for residential purposes before November 1, 1991.”

5.     SWL-13073 (Re), 2008 CanLII 82444 (ON LTB)

“… if the rental unit is located in a building that was constructed after November 1, 1991 and therefore not used as a residence prior to that date, then the rental unit is partially exempt from the Residential Tenancies Act, 2006 and the Landlord is entitled to impose a greater than guideline increase. … I find that the rent for the unit is not subject to guideline increases.”

6.     NOT-03255-10 (Re), 2010 CanLII 79704 (ON LTB)

“… Espanola, was not occupied for residential purposes prior to November 1, 1991. Occupancy to Unit 6 was first granted by the Town of Espanola on June 21, 1993. Consequently Unit 6 was ordered exempt from the rules relating to rent pursuant to clause 6(2) (c) of the Residential Tenancies Act, 2006. …Landlord is entitled to the increase in rent that he is requesting.”

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