On Friday, September 1, 2017, changes to the Residential Tenancies Act, 2006 ("RTA") affected how landlords can terminate a tenancy. Bill 124, Rental Fairness Act, 2017 amended some of the RTA provisions on terminating a tenancy. The amendments provide renters with more protections.
Background
Under the RTA, s. 48(1), a landlord is able to terminate a tenancy for the landlord's personal use. This means that a landlord can terminate a tenancy in good faith for personal uses such as: possession for a family member, for his or her spouse, for his or her children, for his or her parents or for his or her spouse's children or parents or a caretaker of any listed family members. The family member has to live in the unit for at least a year.
Here's an example of how this rule plays out: David owns a rental unit in Yorkville and his oldest daughter, Carly, just got accepted to the University of Toronto. David wants Carly to move into the rental unit so that she can be close to school. Under the RTA, David would be able to have the tenant vacate the unit and have his daughter move in. There are specific timelines for how much notice he would be required to give under the RTA. David can legally remove the tenant as long as this is done in good faith and Carly lives in the unit for at least a year.
The Changes
When a tenant is evicted under this section of the RTA, the landlord will not get off scot free. Under the new section 48.1 of the RTA, landlords will now have to pay the tenant one month's rent as compensation or offer the tenant a comparable rental unit.
This means that when David is evicting his tenant, he either has to pay the tenant one month's rent or offer the tenant another unit.
The Effects
Tenants now have more protections against eviction. Landlords will have to be careful to comply with the new eviction rules. If a landlord wants to move a relative into a rental unit, landlords will have to compensate the current tenant or offer another acceptable rental unit.
The relative has to actually live in the unit for at least a year. If the landlord bends this rule in order to re-rent at a higher rate or convert the unit, there will be repercussions. This can be in the form of a fine up to $25,000. So if our friend, David, re-rents the unit to a new tenant at a higher rate, there could be monetary penalties.
The Landlord and Tenant Board may award a large fine against a landlord if he or she tries to circumvent the rules. This new rule is a way to deter landlords from re-renting a unit at a higher rate or converting a unit.
This comes as part of the government's housing plan, which was announced this spring. This included a cap on rental increases in 2018 at 1.8 percent.
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