Real estate has long held a reputation as being a prime investment vehicle, with rental properties serving as a key subsidiary within the investment class. But when people contemplate purchasing real estate as a rental property, they often hear horror stories involving renters who fail to pay the rent, refuse to be evicted, cause extensive damages, or otherwise create assorted problems for their landlords.
Given the breadth and extent of possible headaches renters can cause their landlords, some people might question why anyone would ever want to be a landlord. But a better question to ask - and one any prospective Ontario landlord should find the answer to - is “what exactly are your rights as a landlord?” If you rent out an apartment in Ontario, what rental laws will ensure that you get paid for your rental, compensated for any damages, and protect you from other possible actions from your renter that might negate your expected investment returns or decrease the value of your rental asset?
Landlord Rights in Ontario Dictated by Residential Tenancies Act
The answers to these questions can be found in the (RTA), which covers the vast bulk of rental law and landlord rights in Ontario. Enacted by the Government of Ontario in 2007, the Act was designed to “create a rental housing system that protects tenants, helps landlords and promotes investment in Ontario’s rental housing market.” The legislation applies to approximately 1.4 million Ontario rental households and is supposed to provide a fair balance between the needs and rights of landlords and their tenants.
The Act Might Not Consider You a “Landlord”
While the RTA covers most rental law in Ontario, just renting out space in a building doesn’t automatically make someone a “landlord” covered under the provisions of the RTA. In fact, there are numerous potential rental situations in which the RTA may not apply, including:
- Seasonal or temporary rentals.
- Units that include shared kitchen or bathroom space with the landlord and/or their immediate family members.
- Long-term-care facility housing.
- The provision of emergency shelter.
Rental situations in which the RTA does not apply often fall under Ontario laws regulating licensee-licensor relationships, which can prove highly complicated and typically provide fewer legal protections for landlords - as well as their renters - than does the RTA.
Along with Rights, RTA Gives Landlords Obligations
Rights bestowed to landlords under the RTA are designed to provide Ontario landlords basic protection from some of the more egregious actions a renter might take that might limit the return and value to the landlord’s investment. But the RTA also gives rights to the landlord’s tenants, which means that the landlord must meet certain responsibilities to ensure that the renter is receiving reasonable accommodations for his or her money and that the terms of the rental agreement are not unreasonably modified.
Landlord Responsibilities Under the RTA
Among key responsibilities assigned by the RTA to landlords, are:
- Keeping the home in good repair that meets all provincial and municipal standards relating to health, safety, and maintenance.
- Providing access to all vital services, including hot and cold water, electricity, heat, and fuel. This access must be maintained at all times, with the exception of temporary disruptions to make repairs, but lease terms can include provisions stipulating that the tenant pays for such services. With regard to heat, the RTA specifically requires that heating must be provided at a minimum temperature of 20°C between September 1 and June 15. For those landlords providing central air conditioning, the RTA allows municipalities to dictate a maximum temperature of not more than 26°C between June and September.
- Maintaining and keeping clear any common or shared areas of the building, including hallways, stairs, yards, driveways, footpaths, or anywhere used by other renters or members of the public.
- Providing tenants with a free-of-charge, written copy of any and all lease or tenancy agreements, along with rental receipts, if so requested by the renter.
The RTA further stipulates that none of these responsibilities can be nullified by any verbal or written agreement between the landlord and tenant. Any such contrary conditions added to a rental agreement will not be considered valid under law.
Landlord Rights Under RTA Conform to Ontario Human Rights Code
Landlord rights under the RTA begin with choosing a tenant, and follow dictates set out by the that ensures equal rights and opportunities to all people with regard to a variety of social interactions and public services, such as housing and employment. Under the auspices of the code, the RTA prohibits landlords from considering tenancy on the basis of:
- Marital Status
- Family Status
- Gender/Gender Identity
- Sexual Orientation
- Receipt of Public Assistance
But the RTA gives landlords the right to vet - and deny rental - based on:
- Income Source Information
- Credit Checks
- Credit References
- Rental History
- Rental Guarantees
Landlord Rights Under RTA After Tenancy
The bulk of landlord rights under the RTA kick in after a renter has achieved tenancy. These landlord rights are designed to ensure a return on the landlord’s investment and, thus, focus on the rent. While they do not specifically force the renter to put down a deposit and actually pay the rent, their inclusion in the RTA makes it easier for landlord lawyers to help landlords recover delinquent and unpaid rental amounts. In short, the RTA enhances the force of law with regard to the right of landlords to receive rental amounts agreed to in the rental contract. Legal action my still be needed in order to recover unpaid rental amounts, but agreed-to rental amounts are harder to dispute under the legalities proscribed under the Act.
The RTA is straightforward with regard to rental amount rights. Landlords have the right to collect a rental deposit up to the amount of one rental period (typically one week or one month). And landlords have the right to collect the rent in the full amount on the day it is due.
Nothing within the RTA gives renters the right to decline payment of the rental amount(s) due, but this does not prevent delinquency and unpaid rents. Such action by renters often still necessitates termination of tenancy and other legal remedies by the landlord, but the RTA does provide more legal force in support of these remedies than existed prior to the Act.
The rights to evict tenants are perhaps the strongest rights proscribed by the RTA. However, any eviction must be justified by reasons proscribed by the act as follows:
- Failure to pay rent or frequent late payments of rent.
- Illegal activities committed by the renter(s) and/or their guests.
- Excessive damage to the rental unit and/or the containing building.
- Unreasonable disturbances by the renter that impact the landlord and/or other building tenants.
- Too many people - based on health, safety, and/or housing standards - living in the unit.
- Lying about income in the rental application.
- Landlord or immediate family intentions to move into the rented premises.
- Plans to demolish the building or initiate extensive repairs that preclude occupancy of the unit.
- Plans to change the usage of the space from housing to some other use.
RTA Includes Right to Increase Rent, But With Limitations
Once a source of confusion and legal discord among both landlords and tenants, the RTA specifically gives landlords the right to increase rental amounts. However, this right comes with a timeframe and other limitations. First off, landlords are only allowed to increase the agreed-to rental amount once in a 12-month period, based on when the tenancy began or, if applicable, on the last rent increase. Second, rental increase amount maximums are set on a percentage basis every year by the (LTB). Based on the Ontario Consumer Price Index, the LTB set the rate at at 1.8% for 2019. In 2020, the rent increase guideline will be set at 2.2%.
The RTA allows landlords to raise rents above the maximum annual amounts proscribed by the LTB; however, this requires an application for permission from the board, which bases its decisions on whether justifications provided by the landlord conform to dictates set out by Ontario’s Rental Fairness Act.
Last, know that any rental increases as allowed by Ontario law, must be preceded by 90-days written notice provided to the renter. As this is a legal requirement, such notices should be delivered by registered mail or other means that ensure a signature acknowledging receipt.
RTA Includes Limited Rights to Enter Rental Units
Landlords “own” their rental properties, so it makes obvious sense that they would have the legal right to enter, inspect, and otherwise interact with their property. But renters have rights, too, including the right to privacy. Thus, the RTA is designed to provide a fair compromise between the integral rights of both landlords and tenants. This compromise means that a landlord’s rights to enter his rental property are restricted to the purposes of maintenance and repairs, showing the property to other potential tenants, and emergencies. In the latter case, the landlord’s rights to enter the property are limited only by the degree of emergency, in that it has to be of a nature that makes it dangerous and unexpected. The rights of other reasons for landlord entry are restricted by the rental entry guidelines, which are established and updated by the LTB. These guidelines currently include (but may not be limited to):
- Entry only permitted between 8:00 a.m. and 8:00 P.M.
- Prior notice of at least 24 hours before entry.
- Entry for the purposes of repair and maintenance.
- Entry for the purposes of showing it to potential purchasers.
- Inspections for insurance or mortgage purposes.
- Inspections for compliance of safety and legal standards.
- Other reasons that may be included on the lease.
Landlords also have the right to show the rental unit to other potential renters, but this right comes with further stipulations, such as acknowledgement between the landlord and renter that the current renter is vacating the rental unit, whether voluntarily or by initiation of eviction proceedings.
To Learn More About Your Landlord Rights, Contact Horlick Levitt Di Lella LLP
Despite the RTA and related government regulations, disputes between landlords and tenants in Ontario - and across Canada - frequently arise. Ontario’s Landlord and Tenant Board typically provides the first venue for legally binding dispute resolution. But disputes between landlords and tenants can also make their way through the court system. Given the complexities of tenancy law, landlords often seek out legal advice from experienced residential tenancy lawyers.
The lawyers at Horlick Levitt Di Lella LLP have more than 30 years of experience protecting landlord rights in residential tenancy and condominium-related disputes in Toronto all across Ontario. We provide expert legal representation before the Ontario Landlord and Tenant Board, Human Rights Tribunal of Ontario, Divisional Court, and all other levels of the Ontario legal system. Our long-running experience and expertise gives us an intimate familiarity with all elements of Ontario tenancy law, and has helped us secure numerous precedent-setting residential tenancy law decisions.
The landlord and tenant law team of lawyers and paralegals at Horlick Levitt Di Lella LLP have combined experience addressing every legal and administrative issue a landlord might face in Ontario. As an active member of the Federation of Rental Housing Providers of Ontario, Greater Toronto Apartment Association, Landlord Self-Help Centre, Ontario Non-Profit Housing Association, Ontario Landlord Association, and other landlord-focused organizations, we are often called upon to provide them with legal guidance on various residential tenancy law matters. Given the scale and scope of our team’s experience, we provide legal advice and representation to both large and small landlords, and tailor fast-response, cost-effective legal solutions designed to minimize total expenses.
To learn more about how our landlord lawyers and paralegals can help you protect your rights, or otherwise resolve a legal-related tenancy issue, schedule a no-obligation appointment by contacting Horlick Levitt Di Lella LLP at 416-512-7440.