Published 2 November 2026 · By Jatin Dua, Broker of Record, RE/MAX Quantum Realty
Yes. Under section 113 of Ontario’s Residential Tenancies Act, the rent for a new tenant is whatever is first charged, so the 1.9% guideline for 2027 does not limit it. After that, the usual rules apply: 12 months between increases and 90 days’ notice. An assignment is not a new tenancy, and evicting to raise rent is not allowed.
This guide is for Ontario landlords setting the rent for a new tenant, and for tenants who want to know if the rent they were quoted is legal. You will get the rule that lets rent reset between tenants, the limits that still apply, the cases that do not count as a new tenant, and what happens to a landlord who pushes a tenant out to raise the rent.
Can a landlord raise the rent for a new tenant in Ontario?
Yes. When a unit turns over to a new tenant under a new tenancy agreement, the landlord and the new tenant can agree on any starting rent. Section 113 of the Residential Tenancies Act (RTA) says the lawful rent for a new tenant’s first rental period is the rent first charged to that tenant.
The Ontario government’s rent increase page says the same thing in plain words: the rent increase guideline does not apply to rental units on turnover, because the landlord and new tenant agree on the amount. The guideline for 2027 is 1.9%, but it only limits increases for a tenant already living in the unit.
This rule is often called vacancy decontrol. Rent control applies during a tenancy. Between tenancies, the rent is free to move.
What does vacancy decontrol mean for a sitting tenant?
It means a long-term tenant can be paying far less than a new tenant would pay for the same unit, and the landlord cannot close that gap by raising the rent beyond what the Act allows. Section 120 limits increases during a tenancy to the guideline, unless the LTB approves an above-guideline increase or there is a valid agreement under the Act.
That gap creates pressure, and the Act is written to stop landlords from using notices, harassment or fake reasons to create a vacancy. More on that below. If you are a tenant wondering whether your own increase is legal, my guide to whether a landlord can raise rent every year walks through the yearly rules.
What rent rules still apply to a new tenant?
A free starting rent does not mean no rules. The table compares the main rules.
| Rule | New tenant, start of tenancy | Same tenant, later increases |
|---|---|---|
| Amount | Whatever is agreed (s. 113) | Up to the guideline, 1.9% in 2027, unless exempt or LTB-approved (s. 120) |
| Timing | Not applicable | At least 12 months since the tenancy began or the last increase (s. 119) |
| Notice | Not applicable | At least 90 days’ written notice on the LTB form (s. 116) |
| Rent deposit | No more than one month’s rent (one rent period) | Can be topped up to the new rent |
| Discounts | Up to 2% for paying on time, or up to 3 months rent-free in 12 months, do not lower the lawful rent (s. 111) | Same |
Source: Residential Tenancies Act, 2006, ss. 106, 111, 113, 116, 119 and 120, Ontario e-Laws; Government of Ontario, Residential rent increases (2027 guideline 1.9%).
The discount rule is useful for landlords. If you offer a month free to fill a unit, and the discount meets the prescribed conditions, the lawful rent stays at the full amount. Later increases are calculated on that full rent.
Are units first occupied after November 15, 2018 different?
Yes, for later increases, not for the starting rent. Section 6.1 of the RTA exempts these units from the guideline:
- units in a building where no part was lived in on or before November 15, 2018;
- units in an addition that was not lived in on or before that date;
- certain second units in houses, such as a basement apartment created after that date in previously unfinished space, or while the owner lived in the house.
For these units, the landlord sets the starting rent and can also raise it by more than the guideline later. But section 6.1 does not exempt them from the 12-month rule or the 90-day notice rule, so those still apply. The landlord carries the burden of proving the exemption if a tenant challenges it at the LTB.
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Does a new roommate, assignment or sublet count as a new tenant?
Not always, and this is where landlords make mistakes.
- Assignment: if the tenant assigns the unit with your consent, section 95(8) says the tenancy agreement continues on the same terms. The new person takes over the existing rent. It is not a new tenancy, so you cannot reset the rent.
- Sublet: the original tenant remains your tenant and stays liable to you under section 97(4). The rent between you and the tenant does not reset.
- Unauthorized occupant: if someone moves in through an assignment you never approved, section 104 lets you negotiate a new tenancy agreement with them. If you sign it within 60 days of discovering the occupancy, the new-tenant rent rule in section 113 applies.
- Miss the 60 days: if you do not sign a new agreement or apply to the LTB to evict within 60 days, section 104(4) can deem the occupancy an approved assignment at the old rent.
Tenants can read more in my guide to subletting versus assignment.
Can a landlord evict a tenant to charge a higher rent?
No. Wanting more rent is not a legal reason to end a tenancy, and the Act punishes landlords who dress it up as something else.
Own-use notices given in bad faith
If a landlord gives an N12 for their own or a family member’s use, then re-rents the unit, the former tenant can apply to the LTB within one year of moving out under section 57. Advertising the unit for rent or signing a lease with someone else during the period from the notice until one year after the tenant leaves triggers a presumption of bad faith. The Board can order:
- the extra rent the former tenant pays elsewhere for one year;
- general compensation of up to 12 months of the last rent;
- moving, storage and similar costs;
- an administrative fine.
Renovation notices
A tenant who receives an N13 for repairs or renovations and gives written notice before leaving has a right of first refusal. Section 53(3) says they can return at no more than the rent the landlord could have charged if the tenancy had never been interrupted.
Harassment is also an offence, and since July 1, 2026 the maximum RTA fine is $100,000 for an individual and $500,000 for a corporation. See my N12 guide for when an own-use notice is valid.
Do not advertise a unit for rent within a year after a tenant leaves on an N12. Section 57(5) of the RTA presumes bad faith if you advertise the unit, sign a new lease, list it for sale or demolish it in that window, and the burden then shifts to you to prove otherwise.
When can a landlord not raise the rent for a new tenant?
There is one built-in exception to vacancy decontrol. When a tenant wins a maintenance application, section 30(1) of the RTA lets the LTB prohibit the landlord from charging a new tenant more than the last lawful rent charged to the former tenant. That ban lasts until the landlord completes the work orders and repairs the Board found were linked to a serious breach. The Board can also ban rent increase notices for the same reason.
Section 114 says that if such an order is in effect when a new tenancy agreement is signed, the landlord must give the new tenant written notice, on the Board’s form, of the lawful rent while the order lasts and after it ends.
A new tenant who should have received that notice can apply to the LTB within one year of the tenancy starting. The Board can set the lawful rent, order a rebate of any overpayment, and fine a landlord who did not give the notice.
How should a landlord set the rent for a new tenant in 2027?
The law lets you choose the starting rent. The market decides whether anyone pays it. TRREB’s Q2 2026 rental report shows GTA condo apartment rents were lower than a year earlier across all bedroom types: the average one-bedroom leased for $2,273, down 2.3%, and the average two-bedroom for $3,013, down 1.7%. TRREB said renters had substantial choice, with 27,844 condo apartments listed for rent in the quarter.
Pricing well above the market in that setting usually means a longer vacancy. My guide to how much rent you can charge walks through how to price a unit.
For landlords, turnover is the one time you can reset rent, so set it carefully: a realistic rent that leases in two weeks beats a high rent that sits empty for two months. Put the agreed rent and any discount in writing on the standard lease, and keep a copy of the advertisement. For tenants, a higher rent than the last person paid is usually legal. What you should check is whether you took over someone else’s lease by assignment, which would keep the old rent.
What to do next
Use this checklist before you sign or quote a rent.
- Confirm the person moving in is a true new tenant, not an assignee or subtenant.
- Check whether any LTB order limiting rent for a new tenant is in effect for the unit.
- Set the starting rent from recent local leases, and record any discount properly.
- Mark the first permitted increase date: 12 months after the tenancy starts, with 90 days’ notice.
- If the unit is new or a post-2018 basement suite, keep proof of the first occupancy date.
Need help with this? Talk to me.
I’m Jatin Dua, Broker of Record at RE/MAX Quantum Realty, and I’m the best agent to do this kind of work for you in Toronto and across the GTA. Over $100 million in GTA sales and 100+ families helped sell. Feel free to contact me any time: call or text 833-330-1925 or email [email protected].
Frequently asked questions
Can a landlord raise the rent between tenants in Ontario?
Yes. Under section 113 of Ontario’s Residential Tenancies Act, the lawful rent for a new tenant’s first rental period is the rent first charged to that tenant. The Government of Ontario confirms the 1.9% guideline for 2027 does not apply on turnover. After the new tenancy starts, normal rules apply, including 12 months between increases and 90 days’ notice.
What is vacancy decontrol in Ontario?
Vacancy decontrol is the rule that lets a landlord set any rent for a new tenant when a unit turns over. It comes from section 113 of Ontario’s Residential Tenancies Act. Rent control in Ontario limits increases during a tenancy, for example to 1.9% in 2027, but it does not cap the starting rent agreed with the next tenant.
Does rent control apply to a new tenant in Ontario?
Not to the starting rent, but yes afterwards for most units. A new tenant in Ontario agrees the first rent with the landlord. After that, if the unit was occupied on or before November 15, 2018, increases are limited to the guideline, 1.9% in 2027, with at least 12 months between increases and 90 days’ written notice.
Can a landlord raise the rent if a tenant assigns the lease in Ontario?
No. When a tenant assigns the unit with the landlord’s consent, section 95(8) of Ontario’s Residential Tenancies Act says the tenancy agreement continues on the same terms. The person taking over pays the existing rent. Only a genuinely new tenancy agreement with a new tenant lets the landlord set a new starting rent.
How soon can a landlord raise the rent for a new tenant in Ontario?
Not until 12 months after the tenancy began. Section 119 of Ontario’s Residential Tenancies Act requires at least 12 months since the tenant first rented the unit, and section 116 requires at least 90 days’ written notice on the LTB form. For a tenancy starting February 1, 2027, the first increase could take effect February 1, 2028.
Can my landlord evict me to rent the unit for more money?
No. Wanting higher rent is not a legal ground to end a tenancy in Ontario. If a landlord ends a tenancy with an N12 and then re-rents the unit within the following year, section 57 of the Residential Tenancies Act presumes bad faith, and the former tenant can apply for up to 12 months’ rent in compensation.
Is a free month of rent allowed in Ontario without lowering the lawful rent?
Yes, if it meets the prescribed conditions. Section 111 of Ontario’s Residential Tenancies Act says the lawful rent is not affected by up to three months rent-free in any 12-month period, or a discount of up to 2% for paying on time. Future increases are then calculated on the full rent.
Are new buildings exempt from rent control in Ontario?
Yes, for guideline increases. Under section 6.1 of Ontario’s Residential Tenancies Act, units in buildings or additions where no part was occupied on or before November 15, 2018 are exempt from the rent increase guideline, as are many basement apartments created after that date. The 12-month rule and 90-day notice still apply in 2027.
What can a new tenant do if the rent was set illegally?
Apply to the Landlord and Tenant Board within one year. Under section 136 of Ontario’s Residential Tenancies Act, rent charged for a year or more is deemed lawful unless an application was made within one year of when it was first charged. If an LTB order limited the rent and the landlord gave no notice, section 115 also allows a one-year application.
Sources
- Ontario e-Laws: Residential Tenancies Act, 2006 (ss. 6.1, 53, 57, 95, 104, 111, 113 to 120, 136, 238)
- Government of Ontario: Residential rent increases
- Landlord and Tenant Board: Information for New Tenants
- Landlord and Tenant Board: A Guide to the Residential Tenancies Act
- TRREB Rental Market Report, Q2 2026
Related reading
- Can My Landlord Enter Without Notice in Ontario?
- Can a Landlord Evict You Without Going to the LTB in Ontario?
- Can My Landlord Raise the Rent Every Year in Ontario? 2027 Rules
- Can a Landlord Put Security Cameras in or Outside a Rental in Ontario?
About the author — Jatin Dua, Toronto and GTA real estate broker
I am Jatin Dua, Broker of Record and co-founder of RE/MAX Quantum Realty Inc., Brokerage, Unit 101, 799 The Queensway, Toronto. I work with buyers and sellers across Toronto and the GTA and have helped more than 100 families sell. Four-plus years of active GTA transactions and over $100 million in sales volume.
Reach me at [email protected] or 833-330-1925, or book a call.