Rent Increase Guideline in Ontario

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Welcome to the Saddest Club on Earth—where landlords painfully watch their rent roll in slower than molasses. We get it: mortgages don’t pay themselves, repairs pop up like unwelcome guests, and utility bills could fund a small vacation (if only you had the time or money). Thankfully, there’s hope beyond the sorrow. Shelterly has spent years perfecting strategies that boost rental income, streamline tenant management, and keep your finances on track. Our proven methods help you set the right rents, enforce prompt payments, and manage pesky expenses so you can finally turn a real profit—and save the tears for something truly sad (like that last Leafs game). It’s time to graduate from the Saddest Club on Earth and join Shelterly’s success stories instead!

Understanding Rent Increase Regulations in Ontario

  1. Annual Rent Increase Cap: 2.5% for 2025
    Under Ontario’s Residential Tenancies Act (RTA), landlords may raise rent by up to 2.5% in 2025, without needing approval from the Landlord and Tenant Board (LTB) Reddit+4MyChoice+4Tribunals Ontario+4CLEO+11York Region+11johnson-team.com+11.

  2. Frequency & Notice Requirements
    Rent increases can occur only once every 12 months, whether from the last increase date or the start of a tenancy. Landlords must provide at least 90 days’ written notice, using the prescribed form (typically Form N1) johnson-team.com+5CLEO+5Reddit+5MyChoice+4SingleKey+4Reddit+4.

  3. Unit Exemptions from the Guideline
    The guideline doesn't apply to units first occupied after November 15, 2018—including many newer condos or added units. These units are exempt and may see rent hikes beyond the guideline, though they still require proper notice and adhere to the 12-month rule Landlord's Self Help CentreWikipedia+6CLEO+6johnson-team.com+6.

  4. Above-Guideline Increases (AGI)
    Landlords may request rent increases exceeding the guideline by applying to the LTB. Valid reasons include:

    • Significant renovations or capital expenditures

    • Substantial increases in municipal taxes

    • Operational costs related to security services
      In most cases, the LTB caps AGI at up to 3% above the guideline per year, spread across up to three years, with proper documentation and tenant notification

Why Shelterly Makes Rent Management Easier for Landlords

  • Automated Compliance: Shelterly’s platform tracks the 12-month cycle and ensures rent increases comply with the 2.5% guideline—triggering a gentle reminder with the correct Form N1 when it's time to issue notice.

  • Custom Handling of Exempt Units: For newer or exempt units, Shelterly enables landlords to set rent increases according to market rates while still managing the required notice and documentation workflow.

  • Streamlined AGI Applications: If you're investing in upgrades or facing higher taxes, Shelterly helps coordinate your supporting documents and LTB application to smoothly pursue approved above-guideline increases.

  • Peace of Mind with Transparency: From guideline tracking to financial dashboards, Shelterly keeps you fully informed—no slips, no stress, just reliable rent management.

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Textbook Methods of Increasing Rent

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    Annual Guideline Increase

    You can raise rent once every 12 months, provided you don’t exceed the provincial rent increase guideline. Ontario law requires at least 90 days’ written notice to the tenant before the new rent takes effect.

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    Above-Guideline Increase (AGI)

    If you’ve made significant capital improvements or incurred unusually high expenses (e.g., security enhancements), you may apply to the Landlord and Tenant Board for permission to increase rent above the standard guideline.

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    Vacancy Decontrol

    When a tenant voluntarily moves out, you’re free to set the rent at any amount for the next tenant. If your unit ha become vacate, contact Shelterly for hassle-free property management.

The Rules
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Pro Tip:

In Ontario, the rent increase guideline does not apply to rental units that were first occupied after November 15, 2018. This includes new buildings, additions to existing buildings, and most new basement apartments. 

If your property was built after this date, there is no rent control, and you can increase the rent, by however much you choose.

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