Sammy Kogan/The Globe and Mail
Barbara Reid, a Toronto resident who lives in one of the city’s oldest rental towers dating back to the 1960s, has a warning for fellow tenants: Just because you live in a rent-controlled building doesn’t mean you won’t face surprise rent increases.
That’s what happened to Ms. Reid. Her corporate landlord has requested a 9-per-cent rent hike spread out over three years. That’s on top of regular inflation-adjusted rent increases of up to 2.5 per cent per year that Ontario allows for rent-controlled buildings.
The extra 3 per cent per year that Ms. Reid’s landlord would like to charge is known as an above-guideline increase (AGI) and is meant to cover capital expenses such as upgrades and major repairs. Landlords must submit those proposed rent increases for review by the province’s landlord and tenant board once they’ve completed the work.
One of the issues with above-guideline increases is that they’ve become increasingly common in Ontario over the past 15 years or so. The number of landlord applications for extraordinary rent hikes has increased from less than 300 a fiscal year in 2009-2010 to more than 1,000 in 2024-2025, according to government data.
“Do we really have rent control in this province when we allow these above guideline increases?” Ms. Reid asked during a phone interview a few weeks ago.
At least some corporate landlords have come to see above-guideline increases as an investment strategy. In a recent report, researchers at the think tank Canadian Centre for Policy Alternatives quoted one real estate investment trust, or REIT, listing those rent hikes under “revenue opportunities.”
This isn’t just an Ontario problem. Tenant groups in B.C. have flagged similar concerns. And other provinces with rent-control regulations, particularly Manitoba and New Brunswick, have similar mechanisms for extraordinary rent hikes tied to capital expenditures.
I asked Toronto tenant advocate Alex Venuto what renters should know about above-guideline increases. Mr. Venuto is co-chair of the Ontario Renters For Fair Housing Coalition, a group that brings together tenant associations across the province.
He said tenants should take the time to comb through their landlord’s applications for above-guideline rent hikes. Buried in the documents – which can be more than 1,000 pages for large rental complexes – can be dubious charges.
For example, Mr. Venuto said he’s seen landlords try to raise rents to cover costs that included expenses related to commercial assets in mixed-use rental buildings (think: stores or restaurants on the ground floor, for example).
It’s also important to know that above-guideline rent increase requests can be negotiated, Mr. Venuto said.
Also good to note: Ontario landlords can start charging for an above-guideline increase before they’ve been cleared by the landlord-tenant board, but tenants don’t have an obligation to pay until the rent hike has been approved. For residents who don’t want to pay until it’s official, Mr. Venuto suggests setting aside the equivalent of the monthly increase in a high-interest savings accounts.
Board decisions on rent increases can take more than two years, which means renters could earn “a nice chunk of money” on interest, he said.
Despite ever more frequent above-guideline increases, Mr. Venuto was unequivocal about rent-control buildings being the superior option for long-term tenants. This holds even now that market rents are falling sharply, he said.
Over time, he said, regulated rents will still be lower. “It’s still better to live in a rent-controlled building at the end of the day.”
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