What You Need to Know about Ontario’s New Standardized Lease Agreement

Posted by C21 Atria on Monday, March 5th, 2018 at 1:04pm.

Any resident of Toronto can tell you, housing is in high demand. As more and more people are attracted to Toronto by promising jobs, post-secondary education opportunities, and the vibrant culture of the community, more homes are needed. Space is the major limiting factor, but as places to live become increasingly more valuable, the other limiting factor for many tenants becomes price.

In an attempt to help landlords and tenants form legal, easily understood, consistent lease agreements, Ontario is rolling out its new Standardized Lease Agreement, and here is what you need to know.

Ontario’s new Standardized Lease Agreement intends to help both tenants and landlords

Prior to the document’s creation, there was no single lease agreement that was used. In fact, many landlords were forced to create their own agreement or wade through the plethora of forms available on the internet. Of course, many of the forms you can find online were designed for different provinces or even different countries.  Now, Ontarians will be able to access one form that is tailored to their province.

The new lease agreement is beneficial to tenants for a number of reasons. Because no standard lease agreement existed before, it seemed like no two rental agreements were the same. As such, tenants weren’t always aware of their rights. One tenant may have encountered a “no pet” clause at several places they have rented and accepted it as a commonplace rule, yet it’s actually illegal for a landlord to deny a tenant the right to keep their pet. This is just one example of an illegal clause.

In an interview with CBC, Geordie Dent of the Federation of Metro Tenants’ Associations said that nearly every lease in Ontario contains something illegal. For example, landlords are also not permitted to task tenants with snow removal or ask for a security deposit. Alongside the new lease agreement, a set of guidelines will help tenants and landlords clarify topics such as:

  • Subletting
  • Landlord entry
  • Pets
  • Guests
  • Illegal charges
  • Ending a tenancy

The new agreement will also include language that is easy to understand. Because many tenancy agreements are written in complex, legal language, tenants don’t always understand what they are signing. This can lead to a poor landlord/tenant relationship later when tenants inadvertently break their lease by not paying rent on time or illegally modifying their suite simply because they didn’t understand what they signed in the first place.

Old Agreements Are Not Affected

As of April 30th, all landlords who acquire a new tenant will be required to use the new agreement. It is important to understand that if you are already renting a suite in Ontario, your agreement will not be affected. This only affects tenancy agreements that are signed after April 30th.

The new agreement can be accessed online on the Government of Ontario website, and landlords and tenants are welcome to make use of it before it becomes mandatory on April 30th.

Not All Housing Types Are Included

This document pertains to apartments, basement suites, and other legal rental properties. Most tenants and landlords will be included within one of those categories, however, there are a few housing types that are not included. These are:

  • Mobile home parks
  • Care homes
  • Land lease communities
  • Co-operative housing
  • Social housing

Adjustments Can be Made

Although this 13-page document is standardized, it is not inflexible and it is not a cookie-cutter agreement. Section 15 allows landlords to add additional terms to the agreement so long as they are within the limits of the law in Ontario.

For landlords who have additional rules about smoking, parking, or other topics, there is still an opportunity to create an agreement that adequately reflects the needs of their unique housing situation. The Landlord and Tenant Board can answer any questions you have about what can and cannot be included within this section if you have doubts.

It’s Still a Good Time to be a Landlord

A healthy vacancy rate is often calculated at 3%. At present, the vacancy rate in Toronto is 1%, and the vacancy rate of Kingston is even lower. If you are a homeowner and you are thinking of renting out your legal basement suite, don’t let these new changes dissuade you. With the demand for housing in Toronto climbing, it’s a great time to be a landlord in Toronto, and the Ontario Standardized Lease Agreement will only make things easier by providing a universal tenancy document that you can use and by helping you avoid complex legal situations by clarifying what you can and cannot include.

For more information on Toronto apartments for rent, contact Century 21 Atria. This experienced group of Ontario real estate agents will be happy to answer any questions you may have about the local market.

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