What Ontario's new housing plan means for renters
The plan extends rent control to all buildings and includes other measures to strengthen tenant rights.
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Relief is on the way for renters in Toronto and across the province.
Flanked by the provincial finance and housing ministers Premier Kathleen Wynne unveiled her plan to address out-of-control home prices and rents, Thursday morning, in the shadow of Liberty Village condos where there’s been no cap on how much landlords could jack up rents.
That’s all changed under the new plan, which makes rent control the rule for all of Toronto’s private buildings. It’s good news for Ranziba Nehrin, profiled by Metro in its recent Code Red series on housing affordability.
The 24-year-old has been worried about rent increases since she started hearing reports of them in her condo building this year.
“It’s a great start,” she said, but called rent control only “one piece of the pie.”
“The fact that people are paying upwards of two grand for their tiny downtown apartment, still doesn’t give me that much hope,” she said.
The new plan extends rent control to all private rental units in the province. Rental increases for units built before 1991 were already capped by a guidelines set each year by the province. That’s 2.5 per cent for 2017. Now all units are covered, ending what was called the “post-1991 exemption.”
Landlords who want to raise rent higher than that must apply to the Landlord and Tenant Board for what’s known as an “above the guideline increase.”
Paul Kershaw, leader of youth advocacy group Generation Squeeze that campaigned to end the exemption, called it "a win for renters."
“Limitless rent increases are now going to be illegal and renters have the protection that rent generally won’t increase more than around 2.5 per cent a year," he said.
It’s too late for west-end tenants profiled in a Metro/Toronto Star story from earlier this month who were informed their rents would double in July.
A spokesperson for Minister of Housing and Poverty Reduction Chris Ballard said the rules do not apply to rent increase notices given before Thursday April 20.
The plan also offers some relief for tenants in buildings built before 1991, who were already covered under rent control. These new measures include developing a standard lease and tightening regulations around landlords evicting tenants for their own use.
“The landlord’s use thing is going to be very, very important,” said Geordie Dent, executive director of the Federation of Metro Tenants' Associations.
“The landlord won’t be able to try to push them out.”
Dent called the changes “important and major” but said more supply in the form of a large-scale building program is needed.
Not everyone is happy about expanded rent control. Jim Murphy, president and CEO of the Federation of Rental Housing Providers, said it will have a negative impact on 28,000 new purpose-built rentals in the pipeline in the Toronto area.
“Most of those projects are now on hold pending a review of this announcement and many of them will be cancelled and not proceed,” he said.
Rent control actually won’t help Nehrin because she’s losing her roommate in September, and will be back on the market soon looking for a new one-bedroom apartment. She'd also like to see the province do more on emergency shelters and transitional housing to help people at risk of homelessness.
“Rent controls are in place. That’s great because you’re stopping a future problem, but there’s still a problem at hand,” she said.
What else do you need to know about “Ontario’s Fair Housing Plan?”
New tax on buyers who don’t live here
The plan introduces a new 15 per cent Non-Resident Speculation Tax (NST) on the price of homes in the entire Greater Golden Horseshoe, with the hope of discouraging speculation and cooling home prices.
It would apply to all individuals who are not citizens or permanent residents of Canada and foreign corporations.
Paving the way for a vacant homes tax
The province promises to introduce legislation that would enable Toronto and other cities to introduce a vacant home tax on empty homes.
It’s something Toronto Mayor John Tory has already said the city is exploring to get empty units back on the rental market.
The plan also includes establishing timelines for elevator repair so that they aren’t broken so often in condos and apartments.
Encouraging rental housing
The province is introducing a five-year $125 million program to encourage construction of purpose-built rentals, units built especially for renting and not owning.
Land for affordable housing
The province pledges to use surplus provincial land for additional affordable housing. Possible sites include the West Don Lands and 27 Grosvenor/26 Grenville St in Toronto.
Strengthening renters’ rights
Along with expanding rent control, the province also pledged to strengthen the Residential Tenancy Act. This includes developing a standard lease in multiple languages, tightening regulations around landlords evicting tenants for their “own use” and offering compensation to tenants facing that situation.
It would also prohibit above the guideline increases where elevator work orders have not been completed and make technical changes at the Landlord and Tenant Board "easier and fairer” for both tenants and landlords.
By the numbers:
$31 a year.
That’s the new limit on how much rent the average Toronto unit can rise per year.
Source: The March 2017 average Toronto rent figure of $1,233 from the Canadian Mortgage and Housing Corporation.