Ontario Capping Rent Increases at the Lowest Rate in Canada

Ontario is holding the annual rent increase guideline for this coming 2025 at 2.5 per cent. It's a rate that's the lowest in the country, below the average inflation rate of 3.1 per cent. The rent increase guideline outlines the highest amount by which a landlord can increase the rent for most tenants without approval from the Landlord and Tenant Board.

The guideline is based on Ontario’s Consumer Price Index, a measure of inflation calculated by Statistics Canada, reflecting economic conditions over the past year. Under the Residential Tenancies Act, the guideline is capped at 2.5 per cent to help protect tenants from rising interest rates that would otherwise result in higher rent. Without this cap, the recent inflation rate would have led to a 3.1 per cent increase in 2025.

Key Points About Rent Increases

Rent Increase Procedure: Rent increases are not automatic or compulsory. Landlords must give tenants at least 90 days' written notice on the prescribed form. At least 12 months must have passed since the tenancy began, or since the last rent increase.

Disputing of improper increases: If a tenant believes they have had a rent increase that is not proper, under the law, they can apply to the Landlord and Tenant Board to request the increase be properly corrected.

Ontario's Housing LandscapeHousing and rental housing starts in Ontario have significantly been on the rise in the past three years—levels that have not been achieved in over three decades. This growth reflects the Government's commitment to meeting the demand for housing while ensuring its fair and adequate supply.

Things to keep in mind

The rent increase guideline applies to about 1.4 million rental households under the Residential Tenancies Act.

Excluded are rental units first occupied after November 15, 2018, vacant residential units, community housing, long-term care homes, or commercial property.

Generally, the rent increase has to be at or below the guideline. Landlords, however, can apply to the Landlord and Tenant Board for above-guideline increases under certain conditions, such as after eligible capital work has been completed and paid for.

Tenants who struggle to pay their rent should contact the local service manager to discuss supports for housing.

The province with the maximum fine in Canada for residential tenancy offences is Ontario.

Sources For More Information

The following resources are quite helpful to anyone in search of more resources about leasing in Ontario and rights protection for tenants:

 Renting in Ontario: Covers information on tenant rights, rental leases, and protection from wrongful or bad faith evictions.

Rent Increase Rules: When and how a landlord can increase rent—for example, the rent increase guideline and how to deal with rent control issues.

Navigate Tribunals Ontario : Understand your rights and responsibilities. Learn how the processes work at the Landlord and Tenant Board.

Dispute Resolution: Visit Ontario’s website for guidance on resolving disagreements with your landlord or tenant, and find out how to get help if a rule under the Residential Tenancies Act is broken.

Equipped with knowledge and active actions, the landlord and tenant will benefit greatly within Ontario's rental landscape, ensuring everyone has a fair and transparent environment.

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