2016 RENT INCREASE GUIDELINE
Each year, the Ontario government announces the province's rent increase guideline for the following year. Ontario's annual Rent Increase Guideline is based on the Ontario Consumer Price Index (CPI), which is a measure of inflation calculated monthly by Statistics Canada. The rate of allowable rent increases for 2016 will be 2.0 per cent. The guideline is the maximum amount that most landlords can increase a tenant's rent during the year without making an application to the Landlord and Tenant Board. It is based on the CPI, which is regarded as an objective, reliable measure of inflation, charting the change in the price all goods and services in the provincial economy. In most cases, the rent for a unit can be increased if at least 12 months have passed since the tenant first moved in, or since his or her last rent increase. The tenant must be given proper written notice of the rental increase at least 90 days before the rent increase takes effect. The 2016 guideline applies to rent increases between January 1 and December 31, 2016.
THE GUIDELINE FORMULA The 2016 rent increase guideline is calculated by averaging the per cent change in the Ontario Consumer Price Index during the previous 12 months, from June 2014 to May 2015, as required by the Residential Tenancies Act, 2006 (the RTA). Note: The RTA sets out that the rent increase guideline cannot exceed 2.5 per cent, even if the CPI calculation is higher.
SAMPLE RENT INCREASE GUIDELINE The monthly rent of an apartment is $800 beginning August 1, 2015. With proper written 90 days notice to the tenant, the landlord could lawfully increase the rent 12 months later on August 1, 2016. For example: ï‚§ The guideline for 2016 is 2.0 per cent. ï‚§ The rental increase is 2.0 per cent of $800 = $16.00. ï‚§ Therefore, the new rent on August 1, 2016 could be up to $816.00 ($800 + $16.00). 2