February 22, 2018

What Tenants Need to Know About the New Standard Lease in Ontario

Ontario is taking steps to protect renters’ rights with the introduction of a standardized lease on April 30, 2018.

Previously, landlords created leases on their own, or with help of a lawyer, and they were often missing important information, were written in legalese or included illegal clauses. Although an illegal clause, such as making a tenant agree to shovel his own snow, or limiting the type of guests a tenant can bring over, is illegal even when included in a signed lease, many renters are not properly informed of their tenancy rights under the Residential Tenancies Act, 2006.

In contrast, the new lease clearly explains tenants’ rights and landlords’ responsibilities, and has sections covering the entire spectrum of landlord and tenant issues: who pays the utilities, how best to contact each party and if insurance is required.

Spelling it Out For Tenants and Landlords

The new lease is one of 16 measures Ontario announced last April to cool the housing market in the Greater Toronto Area, which has spilled over into the rental market.

As Toronto real estate prices rose, speculators entered the market, snapping up condos sometimes by the floor-full. But the higher the prices speculators pay for condos, the higher the rent they’ll need to charge to cover their carrying costs.

As well, with so little other supply for rentals in the GTA and no rent control on any unit built after 1991 (almost ironically, developers stopped building purpose-built rental towers for decades because Mike Harris, the Premier of Ontario at the time, made it less profitable by instituting rent control), renters were at the mercy of their landlords. Renters felt like the situation was spiraling in 2017, as the media reported monthly increases in rent of $1,000, vacancy rates of 1.6 per cent and suspicious cases of landlords trying to evict tenants under one of the few permissible grounds, that they themselves were moving in.

Related Read: When Can You Evict a Tenant in Ontario?

New Restrictions and Protections

In response, Ontario announced the Rental Fairness Act, 2017 last April. Evictions based on “landlord’s own use” were tightened, along with annual rent increases limited to a maximum of 2.5 per cent, on buildings of any age, and includes rent control even on buildings built after 1991 and a shorter notice period to end tenancy for those fleeing sexual and domestic violence.

The standard lease includes information on the amendments. All old leases remain valid, but subject to the new guidelines.

The province recommends contacting the Landlord and Tenant Board for disputes that cannot be solved after discussion.