How the Ontario annual rent increase guideline works
The Ontario rent increase guideline is the maximum percentage most landlords may add to a current tenant’s lawful rent without Landlord and Tenant Board approval. The guideline is 1.9% for increases taking effect in 2027 and 2.1% for increases taking effect in 2026.
Ontario calculates the guideline from the Ontario Consumer Price Index using data from June through May for the following year. The guideline is capped at 2.5%, even if the formula produces a higher number. The guideline is a ceiling, not an automatic increase: a landlord may choose a smaller increase or none.
Is my Ontario rental unit rent controlled?
The key question is generally when the unit was first occupied for residential purposes, not when the building was sold, when the current tenant moved in, or when the lease was renewed.
Guideline usually applies
Most private rented houses, apartments, basement apartments and condos first occupied for residential purposes on or before November 15, 2018.
- Annual percentage cap applies
- At least 90 days’ notice
- At least 12 months between increases
Guideline may not apply
New buildings, additions and most new basement apartments first occupied for residential purposes after November 15, 2018.
- No annual guideline ceiling
- Notice and timing rules still apply
- Landlord must prove the exemption if disputed
What counts as “first occupied”?
It means first occupied for residential purposes—not the start date of your own lease. A 2024 tenant in a building that had residential occupants in 2010 is not in a “new” unit simply because the tenancy is new. For new units in existing houses, Ontario identifies additional conditions; records such as permits, contractor documents and before-and-after photos may matter.
Other situations outside the guideline
The annual guideline also does not apply when a unit turns over and a landlord and new tenant agree on starting rent. Community housing, long-term care homes and commercial properties follow different rules or are excluded. Social housing is covered by the Residential Tenancies Act but has different rent-control and notice rules.
How much can a landlord raise rent in Ontario?
For a guideline-covered unit, the standard answer is no more than the annual guideline unless the LTB has approved an above-guideline increase or another lawful exception applies. Even a percentage at or below the guideline can be invalid if the required procedure is not followed.
What landlords can do
- Increase rent after at least 12 months have passed since the tenancy began or the last rent increase.
- Give written notice on the proper form at least 90 days before the effective date.
- Apply to the LTB for an above-guideline increase in qualifying circumstances.
- Keep documents supporting a claimed post-November 15, 2018 exemption.
What landlords cannot do
- Raise rent more often than once every 12 months for the same tenancy.
- Skip the proper notice because a lease term is ending or ownership changed.
- Treat a request for an AGI as though it were already an LTB order.
- Use the new-build exemption without being able to prove the required occupancy or completion facts if challenged.
Ontario above-guideline rent increases (AGI)
An above-guideline increase is not a landlord-selected surcharge. A landlord must apply to the LTB, file supporting material and receive an order. The LTB identifies three main grounds: an extraordinary increase in municipal taxes and charges; eligible capital expenditures whose expected benefit lasts at least five years; or new or increased operating costs for qualifying security services.
How the 3% AGI limit works
For increases based on eligible capital expenditures or security services, the LTB’s interpretation guideline says the maximum annual amount is generally 3% above the annual guideline. If more than 3% is justified, remaining amounts may be taken in up to two later years, each subject to the 3% annual limitation. That limit does not apply in the same way to justified municipal tax and charge increases.
Tenant participation in an AGI case
Affected tenants receive notice of the application and hearing. They can review the claim, obtain supporting materials under the applicable rules, respond, and attend the proceeding. The result depends on the LTB order—not just the percentage requested in the landlord’s notice.
Tenant rights after an improper rent increase in Ontario
If the proper notice was not given or the amount appears improper, Ontario says a tenant can dispute the increase at the LTB within 12 months after the amount was first charged. Keep the notice, lease, payment records, correspondence and any documents about the unit’s occupancy history.
Check the notice
- Correct tenant and unit
- Proper LTB form
- At least 90 days’ notice
- At least 12 months since start or last increase
- Correct guideline year and math
Check the evidence
- First residential occupancy date
- Building or occupancy permits
- Prior rent records
- Any AGI application and LTB order
- Date the new amount was first charged
A calculator cannot decide a dispute. The LTB can determine whether the guideline or an exemption applies to a particular rental unit. For case-specific advice, use a licensed Ontario paralegal or lawyer.
Ontario rent increase guideline history
The table below shows the published annual guideline used by the calculator. The 2021 guideline was 0% under the rent freeze.
| Year | Guideline | Effect on $2,000 rent |
|---|
Ontario rent increase FAQs
What is the Ontario rent increase guideline for 2027?
The guideline is 1.9% for increases taking effect from January 1 through December 31, 2027. It is the maximum most landlords can add to rent for guideline-covered units without LTB approval.
What is the Ontario rent increase guideline for 2026?
The guideline is 2.1% for increases taking effect in 2026. An increase taking effect in 2027 uses the 2027 rate, even if the notice was delivered in 2026.
Can a landlord raise rent every year in Ontario?
A landlord may generally increase rent only after at least 12 months have passed since the tenancy began or the last rent increase. The increase is not automatic, and at least 90 days’ written notice on the proper form is required.
Are Ontario rentals built after 2018 exempt from rent control?
New buildings, additions and most new basement apartments first occupied for residential purposes after November 15, 2018 are generally exempt from the annual guideline. The landlord must still follow the 90-day notice and 12-month timing rules and must prove the exemption if disputed.
Can a landlord raise rent when a fixed-term lease ends?
The end of a fixed term does not cancel the normal rent-increase rules. The landlord still needs the proper form, at least 90 days’ notice and at least 12 months since the tenancy began or the last lawful increase.
Does selling the building reset the rent?
A change of ownership does not by itself reset a sitting tenant’s lawful rent or erase the timing and notice rules. Vacancy turnover is different: a landlord and a new tenant generally agree on starting rent.
Can a landlord increase rent above the guideline for renovations?
Not automatically. Certain eligible capital expenditures may support an L5 above-guideline application, but the landlord must meet the statutory requirements and obtain an LTB order. Ordinary preference or a simple renovation announcement is not an approval.
What if I already paid an illegal increase?
Ontario says an improper increase may be disputed at the LTB within 12 months after the amount was first charged. Because the correct application and remedy depend on the facts, check current LTB guidance or get licensed legal advice promptly.
Official sources
- Government of Ontario — Residential rent increases. Current and historical guideline percentages, 90-day notice, 12-month timing, exemptions, examples and dispute information.
- Landlord and Tenant Board — Applications for Rent Increases above the Guideline. AGI grounds, procedure, filing timing, tenant participation and 3% limitation.
- Tribunals Ontario — L5 operational update. Current filing update and Rental Unit Information requirement.