Oct 27, 2021

Ontario’s Rental Increase Freeze is Ending – How Will it Impact Tenants?

We are facing a housing crisis in Toronto. The Advocacy Centre for Tenants Ontario found that 46% of all renters in Ontario live in the Toronto area and these households need to earn $24 an hour to be able to afford rent. 

Lack of decent, affordable housing has a direct impact on food insecurity and people living in poverty. In our 2020 Who’s Hungry report, 83% of food bank clients living in private market rentals reported paying more than half of their household income on housing, putting them at high risk of becoming homeless. The high cost of living in Toronto forces people to make sacrifices on where to allocate the little money they have to afford their basic needs like rent and food.  

In an effort to alleviate the financial burden from COVID-19 pandemic, the Government of Ontario introduced legislation to freeze rent increases in 2020. This means that for many tenants across the province, there will be no increase in rent for the remainder of 2021, under the Residential Tenancies Act. Rental units that were occupied or built after November 15, 2018 are not protected under the guidelines outlined by the province. 

Although this has been helpful for many tenants, especially during a pandemic, there are some exceptions that apply. Landlords and tenants can negotiate an agreement on rent increases in exchange for something like a parking spot, a storage unit or air conditioning. In rare cases landlords can submit an application to the Landlord and Tenant Board asking for above guideline increases for their rental unit(s) due to renovation or maintenance costs. 

Beginning in 2022, the rental increase freeze will end and rents will be permitted to increase by 1.2%. In comparison, the limit for rent increases in 2020 was 2.2%. The government sets the limits for rent increases based how well the Canadian economy did the previous year.  

While a 1.2% increase in rent may seem small, this can have a large impact on households who are already struggling to afford their basic necessities.  

One in ten renters in Toronto have accrued rental arrears over the course the pandemic, which means they may face eviction in the future. Among food bank clients, 38% reported being worried about facing eviction in the coming months. 

Stable, affordable housing is a key factor in lifting people out of poverty. All three levels of government have an important role to play in increasing access to affordable housing. 

The City of Toronto is currently consulting on a new policy called Inclusionary Zoning that would increase affordable housing units by requiring large new developments in certain areas of the city to set aside a percentage of the units as affordable. This would ensure that more affordable housing units are being built. While this policy will not solve the affordability crisis on its own, it is a critical tool that can be implemented right away. 

Help us send a clear message to Toronto city Councillors by taking action here

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