With inflation raising the costs of everyday life, it may be wise to start strategizing for potential lifestyle cost increases in the new year.
Every year the Province of Ontario sets the maximum increase landlords can impose on their tenants without approval from the Landlord Tenant Board (LTB). For 2023, the maximum rent increase is set at 2.5%.
Ex. Your rent is $2,000 in 2022
2000 x 0.025 = 50
The most your landlord can increase your rent is by $50, totalling $2,050
When can landlords increase rent by more than 2.5%?
- If they have or will be doing capital work
- If they have or will be providing a new or additional service(s)
- If they apply to the LTB for a rent increase above 2.5% (and the LTB approves the application to increase above 2.5%) due to extraordinary increases to:
- Municipal taxes
- Residential complex charges
- Operating costs for security
- Capital expenditure capital work is done in the residential complex
It is important to note that landlords have to give 90 days notice to their tenant(s) for any rent increase, unless the tenant(s) sign an agreement to have the rent increased. In this scenario, the rent increase can take place 6 days after an agreement is signed.
The best thing tenants can do is plan ahead for this upcoming year and the increases that may take place. Although increases in costs are never fun, knowing what to expect will help ensure that a rent increase does not put you in a vulnerable position this upcoming year.