Becoming a Landlord in Ontario and the laws that relate to it
Deciding to become a landlord is a big commitment and can be very lucrative if certain steps are taken. In 2007, the Residential Tenancies Act (RTA) replaced the Tenant Protection Act and any rental agreements that conflict with the relatively new law are now invalid. Here are a few things to consider when becoming a landlord or for landlords unfamiliar with the Residential Tenancies Act.
Increasing the rent. As far as the starting price for a rental home or apartment, landlords have free reign over what to set the price at. This is an important consideration for those new to the landlord/tenant world and one should consider all the hidden costs of a property as to not lose money. Mainly because after a unit is rented, the landlord cannot raise rent for 12 months and even then they are limited to raising it 2.6 percent. This lowers the amount a landlord is allowed to raise rents under the Tenant Protection Act and was added to benefit tenants. There is a way around to raise it more than this limit, but the proprietor must ask the Landlord and Tenant Board (LTB) for permission. Tenants must also be notified 90 days before a rent increase.
Eviction disputes. In the case of a tenant who refuses to pay rent based on certain grounds of misconduct, they are allowed to make their case to the LTB in their own defense. Defenses could range from a landlord who constantly violates tenant privacy rights by not notifying tenants a day in advance of their visit or storm in unannounced when it is not an emergency to cases where a reported problem (broken water heater, leaky roof, etc) was never remedied by the landlord. Under the RTA, all eviction applications are scheduled for a hearing or mediation without a tenant actually filing a written complaint.
Although the Advocacy Centre for Tenants Ontario (ACTO) admits the automatic hearings is an improvement upon the older system of written dispute applications, they think there is a lot of room for abuse and the RTA still favors landlords to a large extent. Whether this is true or not is a matter of opinion. The 24-hour notice prior to landlord inspection appeared ample to me. The argument that the decontrol of rent on vacant units is unfair for tenants seems spurious, because if the rent is set too high initially, wouldnt tenants simply not rent from them?
It would be a good idea to talk it over with a lawyer specializing in Real Estate Law and fully understands the ins and outs of the RTA and its differences before drawing up rental agreements. The law itself is, very... involved and a great place to start you off is the Landlord and Tenant Board website.
For more information on Lawyer, Toronto Lawyers or to find a lawyer for these types of needs, www.lawyerhead.ca has proven to work well and is excellent at connecting clients with the right lawyer. This entity was created by the RTA and now governs all disputes, applications and the like.