Ontario's rent increase guideline is the maximum percentage most landlords can raise a sitting tenant's rent in a 12-month period without the Landlord and Tenant Board's approval. The province sets it each year under s. 120 of the Residential Tenancies Act, 2006 (RTA). The guideline is 1.9% for 2027 and was 2.1% for 2026. This guide covers how the number is set, the full table of past years, which units are exempt, and how to time a lawful increase with the N1 notice.
At a glance
| Item | Rule |
|---|---|
| 2027 guideline | 1.9% |
| 2026 guideline | 2.1% |
| Statutory cap | 2.5% (s. 120(2)) |
| How often | Once every 12 months (s. 119) |
| Notice | At least 90 days' written notice on the LTB form (s. 116) |
| Usual form | N1; N2 for units exempt from the limits; N3 for care homes |
| Main exemption | Units first occupied for residential purposes after November 15, 2018 (s. 6.1) |
| Above the guideline | By agreement (N10) or an LTB order on an L5 |
How the guideline is set
Under s. 120(2), the guideline for a calendar year is the year-over-year change in the Ontario Consumer Price Index, averaged over the 12 months ending in May of the previous year and rounded to one decimal place, but it can never exceed 2.5%. The Minister must publish it in The Ontario Gazette by August 31 of the preceding year (s. 120(3)). The Ministry of Municipal Affairs and Housing then posts it on its residential rent increases page.
The guideline that applies is the one for the calendar year in which the increase takes effect. The province's own example: a tenancy that starts on June 1, 2026 at $1,000 can be increased on June 1, 2027 by the 2027 guideline of 1.9%, to $1,019.
Current and past guidelines
| Year | Guideline |
|---|---|
| 2027 | 1.9% |
| 2026 | 2.1% |
| 2025 | 2.5% |
| 2024 | 2.5% |
| 2023 | 2.5% |
| 2022 | 1.2% |
| 2021 | 0% (rent freeze; it would otherwise have been 1.5%) |
| 2020 | 2.2% |
| 2019 | 1.8% |
| 2018 | 1.8% |
| 2017 | 1.5% |
| 2016 | 2.0% |
| 2015 | 1.6% |
| 2014 | 0.8% |
| 2013 | 2.5% |
| 2012 | 3.1% |
The province's page lists every year back to 1991. The 2021 freeze is written into the Act itself (s. 120(3.1)). The 2.5% cap was added to s. 120 by S.O. 2012, c. 6; the 2012 guideline of 3.1% was set before it applied.
Who the guideline applies to
The guideline applies to most private residential rental units covered by the RTA: houses, apartments, basement apartments, condos, care homes (rent portion only), mobile homes and land lease communities. It limits increases for a sitting tenant, and for an assignee who takes over a tenancy (s. 120(1)).
It does not limit:
- The rent for a new tenant. Under s. 113, the lawful rent for a new tenant is the rent first charged. When a unit turns over, the landlord and the new tenant agree on the rent.
- Units exempt under s. 6.1. A unit is exempt from the guideline and the above-guideline rules if no part of the building, mobile home park or land lease community, or the addition the unit is in, was occupied for residential purposes on or before November 15, 2018. A separate exemption covers some new units in detached, semi-detached and row houses that had no more than two units on November 15, 2018, where the new unit was completed after that date and either an owner lived in another unit of the house when it was first occupied, or it was built in previously unfinished space. Neither exemption applies to a tenancy agreement entered into on or before November 15, 2018 (s. 6.1(4)).
- Community housing, rent-geared-to-income units and long-term care homes, which have their own rules.
If a dispute arises, the landlord has to prove the exemption. The province suggests keeping building and occupancy permits, plans, new home warranty documents, builder or contractor invoices and before-and-after photos, and noting the exemption in the additional terms of the standard lease.
Rules that apply to every increase, exempt or not
Even where the guideline does not cap the amount, these rules still apply:
- 12-month rule (s. 119). At least 12 months must pass since the tenant's last increase or since the tenancy began. If the unit was assigned in that period, count from the previous tenant's last increase.
- 90 days' written notice (s. 116). The notice must be on the LTB's approved form and state the new rent. An increase without proper notice is void, and the landlord must serve a new notice (s. 116(4)).
- Approved form. The N1 is the standard form. The N2 is for units exempt from the rules limiting increases; its instructions describe partially exempt units such as non-profit and social housing. The N3 is for care homes. The N2 instructions date from May 2017, before s. 6.1, and the LTB has not published guidance on which notice it expects for a unit exempt under s. 6.1; check with the LTB before serving.
The LTB's hearing-process page confirms that for a post-November 15, 2018 unit, "the landlord must still give at least 90 days' notice in writing of any rent increase using the proper form but there is no limit on the size of the rent increase."
Timing the N1
- Pick the effective date. It must be at least 12 months after the last increase or the start of the tenancy, and usually lines up with the first day of a rental period.
- Count back at least 90 days. The N1 must be given at least 90 days before the effective date.
- Add time for the delivery method. A notice sent by mail is deemed given on the fifth day after mailing (s. 191(3)). If you mail it, mail it at least 95 days ahead.
- Serve it properly. The N1 instructions allow handing it to the tenant or an adult in the unit, leaving it in the mailbox or where mail is ordinarily delivered, sliding it under the door or through a mail slot, courier, mail, or fax. You cannot post it on the door.
- Calculate the new rent correctly. Apply the guideline for the year the increase takes effect to the current lawful rent. If you ask for more than the guideline on a covered unit, the excess is not lawful.
A tenant who does not give notice to end the tenancy after receiving the N1 is deemed to accept the increase allowed by the Act (s. 118). Under s. 136, a rent increase is deemed lawful unless the tenant applies within one year after it was first charged.
Going above the guideline
There are two lawful routes for a covered unit:
- Agreement (N10, s. 121). The landlord and tenant can agree to an increase above the guideline in exchange for a specified capital expenditure or a new or additional service. The increase cannot exceed the guideline plus 3% of the previous lawful rent, the tenant can cancel in writing within five days of signing, and it cannot take effect earlier than six days after signing. No N1 is needed for this increase.
- Application (L5, s. 126). The landlord can apply for an above-guideline increase for an extraordinary increase in municipal taxes and charges, eligible capital expenditures, or operating costs for outside security services. The portion for capital expenditures and security costs is limited to 3% above the guideline in any 12-month period, with any excess carried into the next two periods at no more than 3% each. The landlord still serves an N1 at least 90 days before the increase. See L5 and LTB filing fees.
Some increases fall outside the 12-month rule and the 90-day notice: under s. 123, the landlord and tenant can agree to add a parking space or another prescribed service, with the rent increased as prescribed.
Related rules landlords forget
- Rent deposit interest. Each year the landlord must pay interest on a last-month's-rent deposit at the guideline rate in effect when the payment becomes due (s. 106(6)). For 2027 that rate is 1.9%. The landlord may keep part or all of that interest to top up the deposit so it matches the new monthly rent (s. 106(7)).
- Air conditioners. Since July 1, 2026, where electricity is included in the rent, a landlord may charge a seasonal increase for a tenant-installed window or portable air conditioner. See Interpretation Guideline 11.
Frequently asked questions
What is the rent increase guideline for 2027 in Ontario?
1.9%, as published by the Ministry of Municipal Affairs and Housing. For 2026 it was 2.1%.
Can I raise the rent by 2.5% because that is the cap?
No. The cap limits what the guideline itself can be. A landlord of a covered unit can increase by no more than the guideline for the year the increase takes effect, unless an N10 agreement or L5 order allows more.
My unit was first rented in 2020. Does the guideline apply?
If no part of the building (or the addition) was occupied for residential purposes on or before November 15, 2018, the unit is exempt from the guideline under s. 6.1. You still need 90 days' written notice on the proper form and the 12-month rule.
What happens if I serve the N1 late?
The increase is void (s. 116(4)). Serve a new notice that gives the full 90 days and choose a later effective date.
Can I increase rent when a tenant moves out?
Yes. The rent for a new tenant is whatever is first charged (s. 113), subject to any LTB order in effect for the unit.
Official sources
- Residential rent increases (Ontario Ministry of Municipal Affairs and Housing)
- Residential Tenancies Act, 2006, ss. 6.1, 106, 113, 116, 118–121, 123, 126, 136, 191
- N1 Notice of Rent Increase and instructions
- N2 instructions
- Interpretation Guideline 11 (seasonal air conditioner charges)
- LTB Application and hearing process