aging residential towers

Ontario capping rent at 1.6 per cent

Thursday, July 3, 2014

The Ontario government is capping residential rent increases at 1.6 per cent for the one-year period between Jan. 1 and Dec. 31, 2015. The new guideline applies to approximately 85 per cent of the province’s privately owned units.

“While this is higher than the 0.8% rent increase limit set for 2014, it will present a challenge for landlords who face higher cost increases such as water, insurance, energy/heating and maintenance/repairs,” says Mike Chopowick, vice president of government and industry relations for the Federation of Rental-housing providers of Ontario (FRPO).

The cap, also known as the rent increase guideline, refers to the highest amount landlords can raise their tenants’ rent without first consulting the Landlord and Tenant board.

“The low rent guideline clearly does not reflect the rising costs of managing an apartment building, and makes it difficult for landlords to invest in Ontario’s aging rental housing stock,” adds Chopowick. “FRPO is strongly recommending the government phase-out rent controls on housing.”

Chopowick says Ontario should embrace British Columbia’s system, where rent guidelines take into account the CPI index plus an additional two per cent increase for capital repairs.

“Ontario’s rent guideline is also capped at a maximum 2.5 per cent, and this cap should be eliminated immediately,” he says.

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