Parkdale Community Legal Services

Tenants Rights Workshop

RENT INCREASES

Legal Disclaimer:

This presentation is for informational purposes only.

It is not to be taken as legal advice.

If you need legal advice, feel free to either visit Parkdale Community Legal Services at 1266 Queen St. West or contact us at 416-531-2411

Overview:

Your landlord is legally permitted to raise your rent.

To do so, must follow the rules set out in the Residential Tenancies Act (“RTA”) if the Act applies to your tenancy.

There are 3 types of rent increases allowed under the RTA.

Does the RTA apply to me?

The RTA applies to most rental housing in Ontario, such as rooms, apartments, houses, mobile home parks, and retirement homes.

The RTA may not apply to rental housing that is supposed to be used for business, if the kitchen or bathroom is shared with the owner of the property or a family member of the owner or in some types of temporary or seasonal housing.

Rent for New Tenants:

Typically, there is NO LIMIT on how much rent a landlord can charge when a new tenant moves in.

Therefore, your starting rent will be whatever you and your landlord agree to in your tenancy agreement or lease.

After you and your landlord agree on a starting amount for rent, your landlord must follow the rules in the RTA to raise your rent.

Rent Increases under RTA Rules:

General: 3 Types of Rent Increases

1. Guideline Increases

2. Above Guideline Increases

3. Increases Agreed to by You and your Landlord

Notice 1. Periods

2. Contents

Types of Rent Increases: Guideline Increases

Guideline Amount– Percentage that Provincial government set– For 2013 = 2.5 // For 2012 = 3.1%

12 Month Rule– Landlord must wait 12 months from start of lease to raise– Rent can only be increased once every 12 months

Notice– At least 90 days– Must be in writing– Delivery & Contents ……

Notice:

Delivery Methods:

1. Landlord hands it to you directly;2. Leaves it in your mailbox; 3. Leaves it where you normally get mail;4. Places it under the door of your unit5. Sends it by fax to business or home6. Sends it by courier or mail

***Cannot simply be posted on your door***

Notice:

Contents1. Name(s) of Tenant(s)

2. Complete address including unit number

3. Name of the Landlord

4. Date that the rent increase is to take effect

5. The amount the rent will be increased by

6. Explanation for the increase

Types of Rent Increases: Increases Above Guideline

Can be done, but must be approved by the Landlord & Tenant Board (LTB)

Legitimate reason for an increase above the guideline amount must be provided

12 month rule and 90 days written notice still apply

Reasons for Increases Above Guideline

1. Unusually high increases in property taxes or utility costs;

2. Cost for security services; or

3. Capital Expenses*

Capital Expenses

Major repairs, renovations, replacements or additions which:

1. Will last for 5 years (at least) and

2. Not part of routine ongoing maintenance

Application:– Must apply to the LTB at least 90 days before they want

the increase to start.

Hearing:– If application is made, LTB will schedule hearing– Landlord must provide you with notice of hearing at least

14 days before hearing

Capital Expenses Increase: Hearing

Challenging the Application: Tenant’s who would be affected by increase have

the right to challenge the application – Ex. Work not needed // Costs less than stated

LTB Decision: After the hearing, Board will decide how much

increase will be allowed.– Capital Expenses or Security – up to 3% above guideline

amount, up to 3 years in a row.– Taxes and Utilities – No limit

Types of Rent Increases: Agreements to Raise Rent

• Types of Agreements where you and your landlord can legally agree to raise rent above guideline amount

1. Agreement for improvements or new services

2. Agreements to get new items or services listed in the RTA

Note: If your landlord asks you to agree to an increase that is more than the guideline amount, you can always refuse!

Agreements to Raise Rent

1. Improvements or New Services

Examples: New security system Washer and Dryer Stove or other appliances, etc.

If you agree to a rent increase based on improvements or new services, your landlord does not have to give you written notice.

But….

Improvement or New Services: continued….

…There are requirements:

1. Must be in writing on correct LTB form

2. Can be cancelled if notice in writing given to landlord within 5 days of signing agreement

3. Cannot increase your rent sooner than the sixth day after you signed the agreement

4. Cannot raise your rent more than 3% above the annual guideline amount for that year

5. Cannot increase your rent before 12 month has passed since last rent increase or first moved in

Agreements to Raise Rent

2. Items Listed in the RTA

– You can also agree to a rent increase above the guideline amount for certain new services or things, including:

1. Parking Space

2. Cable or Satellite television

3. Air Conditioner

4. Extra electricity used by A/C, washer, dryer, etc

5. Lockers

6. Storage Space

7. Extra Floor Space

Note: These are only some of the items listed in the RTA.

Items Listed in the RTA: continued…..

Points to Keep in Mind: Landlord not required to give written notice to you, if you agree

to the rent increase.

Does not have to be in writing – (*better to get in writing)

No right to change mind after agreement made.

Not limited to 3% above guideline amount – only needs to be “reasonable” amount or landlord’s actual cost

If you and landlord agree to stop providing the service or item, your rent must go back down

12 month rule does not apply

If You Have Paid Too Much

If your landlord has charged you an illegal amount of rent (i.e. Increased rent illegally) you can:

1. Apply to the LTB to get your money back

2. Contact the provincial government’s Investigation and Enforcement Unit to look into the issue.

If you have paid too much: Applying to the LTB

Forms and general information– www.LTB.gov.on.ca

Remedies:– Board can order your landlord to pay back any amounts that were

not permitted by the RTA– Board can also order that your rent be corrected to the proper legal

amount under the RTA

Time Limit:– 1 year– Illegal rent charged for more than 1 year without challenge

becomes legal rent!**

If you have paid too much: Contacting the IEU

Investigations and Enforcement Unit (IEU)– Job function is to encourage landlords and tenants to obey

the rules under the RTA

– Also able to lay charges against landlords who will not follow the rules.

Fines payable to government– Corporate Landlord max fine $50,000– Personal Landlord max fine $10,000

– Contact information: www.mah.gov.on.ca/ieu 1-888-772-9277 or 416-585-7214