Everything About Rent in Ontario
Updated May 2023
Rent is perhaps the most important concept to understand when signing a tenancy agreement. Once you’ve signed a lease, you are legally obligated to pay rent according to the terms of the contract. That may seem simple, but there are a few aspects of rent payments that must be understood.
1. Rent Only Covers What Was Agreed Upon
Your landlord is only obligated to provide you with services that are agreed to in the contract. Ensure that if you have been told that utilities are included, it is stated on the contract prior to signing. Here are other services to keep in mind that rent may or may not cover:
- Air conditioning units or central air
It is not necessarily a loss if any of these aspects are not included in your rent; it simply means that you will be charged an extra fee for access to them. If utilities are not included, it also gives you the opportunity to control the amount you use, potentially saving you money if you conserve.
2. The Rent Price Is Set in the Contract
An agreement on price between the landlord and resident is set in the contract. Ensure that the price you’ve agreed to verbally is the same price written down. This points to the importance of taking the time to read and understand your entire contract before signing it. As stated in the previous section, rent only includes what is agreed upon, so it’s always a good idea to confirm that all these services and amenities are outlined so that changes can be made before you sign.
3. Rent Increase
By law in Ontario, your landlord can only increase the rent once every twelve months. The landlord must give you written notice of a rent increase at least 90 days before the change goes into effect. They will be required to follow rent control guidelines as set out by the Ontario Ministry of Municipal Affairs and Housing. Each year this department sets new limits based on the overall economic conditions. Any increases above this amount must be approved by the Landlord and Tenant Board (LTB). It’s also important to note that new buildings, new units in existing buildings and most basement apartments are exempt from rent control. These guidelines also don’t apply to:
- Vacant residential units
- Long-term care homes
- Community housing
- Commercial properties
4. Rent Deposits Are Common
Most, if not all, landlords or rental companies will ask for a rent deposit. This deposit can be no more than the cost of one month’s rent. This deposit may only be used as payment for your last month’s tenancy. If rent is raised at any point, the landlord may ask you to supplement the deposit to that amount.
5. Security Deposits Aren’t Legal Everywhere
Security deposits are legal in some regions of Canada, such as British Columbia. This is where a landlord will collect a certain amount as “collateral.” At the end of your tenancy, if your unit is in good condition, you’ll get the deposit back. However, if there is significant damage, your landlord will keep some of your deposit to pay for the repairs.
However, in Ontario, for example, security deposits are illegal. The acceptable type of lump sum deposit in this region is the rent deposit, which we discussed above.
6. Payment Method Is Also Subject to Agreement Between Tenant and Landlord
This payment method must be agreed upon by the landlord and tenant and cannot be changed unless both parties approve the change. Though a landlord can offer to accept payment via post-dated cheques or automatic payments, they cannot require residents to pay via those methods.
7. Rent Receipts Only Upon Request
Landlords are only obligated to provide a rent receipt if the resident requests one. These receipts cannot be charged for. These aspects of rent are all in agreement with the Landlord and Tenant Board’s guidelines and rules.
8. Ask About Move-In Specials
Some rentals come with move-in-specials which could include discounts on rent or one-month free options. But before signing, make sure you understand how this rent special is calculated. Some of these specials come with longer leases or with a set move-in date. So, that $1500 apartment with one month of free rent might actually be $1645 a month. The wording matters, so be sure you get some clarity on what you are really paying each month to avoid being caught off guard with higher-than-expected rent.
Renting Apartments Made Easy
Have any questions? At CLV Group and InterRent REIT, we can help you navigate the complexities of renting. With apartment listings across Ontario, Quebec, and British Columbia, we have the knowledge and expertise to ensure you understand the terms of your contract. Check out our apartment listings today to get started.