Rent Increase Guideline 2017 – Ontario Landlords Can Raise The Rent By 1.5 Percent
We have heard from a lot of landlords in Toronto who doing very well these days. And why not with houses appreciating at a record rate and lots of good qualified tenants out there looking for good landlords and great properties to rent.
According to CMHC the average Toronto detached home is now worth over well over $1,000,000. With prices appreciating many people who never expected to be a landlord are buying investment properties and renting them out. The tenants pay your mortgage and after a few years you can sell for a nice juicy profit.
Condo Investors and Landlords
A lot of readers are these people who have jumped into the market. Many have invested in condos and become “condo landlords”. There is also good news for these Toronto landlords. According to the Toronto Star condo prices could jump by $60 a square foot in 2017. More and more people view investing in a Toronto condo as a smart investment strategy.
Challenges For Toronto Landlords
While there is a lot of good news for landlords you still need to be very careful. There have been lots of stories about “tenants from Hell” and this means you need to screen tenants carefully.
For example, CBC news had a series of new stories about a “well dressed” tenant who caused lots of grief for his landlord. This professional tenant ended up costing his landlord tens of thousands of dollars and took many months to evict. There was even an alleged assault involved and the tenant was charged.
Experienced and successful Toronto landlords know that there are lots of great tenants out there who want to rent a well-maintained and affordable rental property. But you need to be careful because there are also “professional tenants” who can manipulate the system and end up costing you thousands of dollars in losses (and months of sleepless nights).
Make sure you screen your tenants carefully, including running a landlord credit check, before signing the lease and handing over the keys!
Safe Rental Units
It important to make sure your property is up to code and safe. Newmarket landlords are taking the lead in this regard as their city even has a way to ‘register’ a basement apartment as safe and legal.
Landlord and Tenant Board (LTB) Fees Have Gone Up
If you do rent to a bad tenant you will go to the Landlord and Tenant Board (known as the LTB) to try to evict them. Many landlords are not happy with the long process required to evict a tenant who isn’t even paying rent.
LTB Fees Are More Expensive in 2017
According to the Ontario Landlords Association LTB fees are going up 2017. This means a cash-strapped landlord will have to pay even more just to begin the process of trying to evict a bad tenant.
Ontario Landlords Can Raise the Rent 1.5% in 2017
Ontario landlords are usually covered by the annual rent increase guideline. This is comes from the provincial government and is usually announced every June. It informs residential landlords how much they can legally raise the rent in a given year.
Are Covered By The Rent Increase Guideline?
Many small residential landlords who only own or or two units believe the 2017 rent increase is far too low and unrealistic. They say the cost increases of maintaining their rental unit in good condition is far more than only 1.5% of what their tenants pay in rent.
The good news is many readers might not be covered by the low rent increase guideline of 1.5%. The rules are a bit tricky but there is a good article here and you can check out the Ministry website or call them for details.
The key thing most landlords should look at is you may be except from the guideline if “No part of the building was occupied for residential purposes before November 1st 1991.”
Here are the general thresholds to see if you are not covered.
1. The rental was not occupied for any purpose before June 17th, 1998
This means your rental property was built after June 17th, 1998 or you have built a new unit in your property that was never occupied before June 17th, 1998.
2. The rental unit was never previously rented since July 29th, 1975
This means only the owner has lived in the property since the date of July 29th, 1975.
3. No part of the building was occupied for residential purposes before Nov. 1st 1991
This means the property was converted from commercial to residential or was not built or occupied until after November 1st, 1991.
Make sure you contact the LTB for more information if you have questions about whether or not your rental property is exempt from the annual rent increase guideline.
Toronto Landlords Success in 2017
Things are looking good for people who have invested their hard-earned savings and become landlords in Toronto.
Make sure you are a professional and service oriented landlord who knows the rules and procedures of the LTB and the Residential Tenancies Act.
If you are going to raise the rent make sure to check if your rental property make sure you check because your Toronto rental property might be exempt from the annual rent increase guideline.