If Your Rental Property Was Built After 1991 You Could Be Able To Raise the Rent As Much As You Want
Ottawa landlords were shocked when they read the Ottawa Sun article on how much residential landlords can raise the rent in 2014.
After all, the Sun article explained the Ontario government was capping the rent increase for 2014 at the lowest level in decades.
The article continued by stating:
“Tenants who live in buildings completed on or before Nov. 1, 1991 will see a maximum hike in their rent of 0.8% in 2014 which works out to $6.40 on an $800 monthly rent.”
It continued by slamming home an important fact.
The 2014 increase was:
“The lowest rate in the 23-year history of the rent control program was 0.7% in 2011 — a provincial election year.”
Landlords Are Unhappy With This Low Increase
Some landlords, such as a Mississauga Landlord in the Sun article said many landlords are selling their rental properties.
After all, are your property taxes capped at 0.8%? No.
How about the cost of a new furnace or roof?
Are Ontario plumbers and electricians capped at 0.8%?
We previously wrote this type of government unfairness could lead to landlords leaving the residential industry and becoming commercial landlords.
How Does This Compare with Other Provinces and Rules for Landlords?
Some provinces are similar to Ontario.
For example, landlords in Manitoba can raise the rent by 2 % in 2014.
British Columbia landlords can also raise the rent by the rate of inflation. However they can also add two percent to whatever the annual rate of inflation is.
As usual, Alberta has the most landlord-friendly rules. In 2014 Alberta landlords can raise the rent as much as they want to as long as they provide proper notice.
Wait, I Saw the Article Say This Is For Buildings Completed On or Before Nov. 1, 1991. What Does That Mean?
Yes, and this is very important.
It means some landlords are exempt from this annual rent increase guideline.
According the Ontario Landlords Association if your buildings meet some criteria you might be exempt from the government guideline.
Landlords can raise the rent as much as you want if your rental property was built after November 1st, 1991.
(Please note you still have to give proper notice to your tenants, which is 90 days or three monthly rental periods.)
Why Does This Loophole exist?
According to lawyer and Toronto Star columnist Bob Aaron we should not call this a ‘loophole’ at all.
Aaron explains this was a carefully crafted policy to act as an incentive for people to invest in rental properties and become landlords.
How Can I Find Out More?
Make sure you read the Ontario Landlords site for more information and also check out the Ontario Landlord and Tenant Board website.
Do You Own A New Condo, House, Townhouse or Apartment Built After November 1st, 1991?
You might be exempt from the low government rent increase guideline!
It’s great news for you and your investment.
Discuss this further at the Ontario Landlord Forum