Ontario is more than doubling the maximum rate that a landlord can raise a tenant’s rent next year – the highest direction to increase rents in the province in a decade.
On Wednesday, the province announced that the guidelines for increasing Ontario’s rent for 2023 are 2.5 percent.
Landlords were previously allowed to raise rents by 1.2% in 2022, following a rent freeze introduced in 2020 to help Ontario residents during the start of the COVID-19 pandemic.
The last time the Ontario rental increase guidelines reached 2.5% was in 2013.
“As families in Ontario face rising living costs, our government is providing stability and predictability to the majority of tenants by limiting rebate targets to 2.5 percent,” said Steve Clark, Secretary of State. municipal issues and housing construction. statement on wednesday.
The guidelines are based on the Ontario Consumer Price Index, a measure of inflation calculated monthly by Statistics Canada, which uses data reflecting economic conditions over the past year.
This was followed by an unprecedented move by the Bank of Canada earlier this month, raising its key interest rate by half a percentage point to 1.5% for the second time in two months.
If rent increases in Ontario coincide with recent inflation, the 2023 target would rise to 5.3 percent. “However, the guidelines are limited to help protect tenants from significant rent increases,” the province said.
The new rental guidelines come after a report found that rental prices in Toronto have risen by 20% over the past year. The average rental price in the city rose to 2474 dollars in May, compared to 2035 dollars a year ago. This marked the most significant monthly increase in rental prices since 2019, before the pandemic began.
The government says rent increases are not automatic or mandatory. They are the maximum amount that the landlord can increase the rent of the tenants without the approval of the Council of Landlords and Tenants.
Landlords must give tenants written notice of at least 90 days before they start raising the rent. At least 12 months must have elapsed since the first day of the lease or the last increase in the rent.
The rent increase for 2023 is applicable between 1 January and 31 December 2023.
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