Storeys: Ontario Landlord Wants to Raise Your Rent? Here Are Your Next Steps

Over the course of the past year, housing advocates in Ontario have observed an uptick in unregulated rent increases.

Genrys Goodchild, Communications and Public Affairs Specialist for Advocacy Centre for Tenants Ontario (ACTO), says that while some hikes are within the provincially mandated rent cap, others pack a much pricier punch.

“We’ve been approached by tenants in units not protected by rent control whose landlords are demanding increases of 20% or more each month, which can translate to hundreds of dollars more in monthly rent.”

While rental exorbitance is nothing new in Ontario, specifically in the Greater Toronto Area, mounting affordability challenges have made a bad situation worse. Landlords are being cornered by rising costs and shrinking margins, leaving some to resort to unlawful rent increases to help make ends meet. Renters, unfortunately, are collateral damage.

“Unsustainable rent increases are a huge part of what’s driving the affordable housing crisis in Ontario. Renters are being evicted, displaced, and living in unsuitable housing because they can’t afford to move. Most renters’ wages have not kept pace with the kinds of increases landlords are demanding of them,” says Goodchild. “It’s brutal.”

Spotting an Unlawful Increase
To some extent, there is policy in place to protect tenants from unreasonable rent increases.

In short, all rental units, including apartments, condos, and basement units, first occupied for residential purposes before November 15, 2018 are subject to rent controls under the Residential Tenancies Act. This means that landlords can only increase rent by a pre-determined percentage based on the Consumer Price Index of the previous year. For 2023, the cap is set at 2.5%. Anything occupied after that November 2018 cut-off isn’t subject to the cap.

Goodchild says that rent controls apply to most rental units in the province. However, landlords aren’t legally obligated to disclose whether a unit is rent controlled when signing up a new tenant, so it’s up to the tenant to do their homework and be aware of their rights.

“Even though many units are covered by rent control, some landlords will attempt to get higher rents anyway,” she says. “They’re banking on their tenants not knowing or not being able to exercise their rights to refuse an illegal increase.”

In order for a rent increase to be legal, a Notice of Rent Increase must be served at least 90 days before the increase comes into effect, and official forms must be used. Without proper notice, the rent increase becomes void. In most cases, rent can only be increased once every 12 months.

Landlords also have the option to apply for an Above Guideline Increases (AGI) through Ontario’s Landlord and Tenant Board (LTB).

“To be granted an AGI by the LTB, the landlord must prove they’ve made substantial improvements to the rental unit that would warrant an increase — or in some cases, experienced a big jump in property taxes,” says Goodchild. “Renters should know that AGIs have to be granted by the LTB before they are considered legal. A landlord cannot just demand you pay an AGI because they say so.”

She cautions that there’s not much stopping landlords from applying for an AGI without proper grounds. “The issue here is many landlords, especially corporate landlords, are making mostly minor or cosmetic upgrades to existing units and trying to claim it justifies an AGI. Some landlords routinely attempt to sidestep rent controls in this way.”

Disputing a Rent Increase Through the LTB
Member of Provincial Parliament for Parkdale-High Park Bhutila Karpoche says she’s well aware of increasing instances of tenants being priced out of their homes. She’s also seen a troubling spike in “bad faith evictions.”

“When a tenant is evicted, there is no cap on rent increases, so the incentive for bad-faith evictions exists. This leads to tenants being forced out of their homes, and rents skyrocketing. This isn’t happening just in Toronto, but across Ontario.”

In cases of bad faith evictions, she advises renters to fight back.

“What I tell every tenant who reaches out to me is that an eviction notice does not mean they have to move out. It’s a notice, not an order. Tenants have the right to a process before the Landlord and Tenant Board. I also tell them to not to sign documents they don’t want to without going through the process.”

More specifically, tenants can file a Tenant Application for a Rebate of Money the Landlord Owes with the LTB, also known as a T1 Application. If the rent increase is indeed illegal, any rent charged unlawfully can potentially be refunded to the tenant. But tenants should act quickly — tenants who suspect an unlawful increase are required to report it within 12 months after the amount was first charged.

It’s worth noting, however, that going through the LTB can be a time-consuming process.

“The COVID-19 pandemic had a significant impact on the LTB’s caseload, including the five-month moratorium on eviction hearings from March to August 2020 which contributed to us falling short of meeting our service standards,” says a spokesperson for the LTB. Approximately 25,000 prospective hearing slots were lost during the moratorium, and the board is now facing a debilitating backlog. “Currently, depending on the application type, new and adjourned matters are being scheduled, on average, within seven to eight months.”

She adds that the LTB is in the thick of various other changes that are implicating processing times, including the adoption of a new case management system, Tribunals Ontario Portal, and a shift towards virtual hearings.

“Although our approach is digital-first, it does not mean digital-only,” says the LTB spokesperson. “A party may request an alternate format, including an in-person hearing.”

In addition, applicants have the option to submit a Request to Shorten Time form or request to have an expedited hearing if they feel their application should be scheduled with urgency. These requests are reviewed by an adjudicator for decision, and if granted, priority cases are typically heard within a few weeks.

Tenants Have the Right to Organize
Ria Rinne, a member of Toronto ACORN, stresses that, in cases of rent increases or other grievances, tenants have the right to organize.

“When tenants come together with their neighbours to fight a rent increase, to demand repairs, or for whatever, there’s power in numbers. We can only use our rights when we come together and force the landlords or the government to pay attention.”

Rinne also recommends getting in touch with Toronto ACORN.

“There are probably ACORN members living in your building,” she says. “As a group, it’s easier to figure out what other resources to access such as legal aid or city services you can use to fight the rent increase.”

For those opting to organize, Jessica Bell, Member of Provincial Parliament for University—Rosedale, notes that the strongest tenants’ associations “regularly door knock, give out flyers, and host meetings.”

She adds that, for cases related to rent arrears, the Toronto Rent Bank exists to provide rent help — although accessibility to the funding is limited. “In many cases, this applies only to renters who are low-income and have fallen behind on their rents.”

In addition, housing advocates point to the one-time top rent top up currently being offered through the federal housing benefit, and recommend approaching local community legal clinics, such as Probono Ontario and Legal Aid Ontario for advice on a case-by-case basis.

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Article by Zakiya Kassam for Storeys