In 2017, Anderson Adams was very proud that lawyer Vanessa Playtis was elected as a member-at-large to the real estate section of the Ontario Bar Association: read all about it right here!
And in that role, Vanessa plunged right into the intricacies of Bill 124, Ontario’s Rental Fairness Act, which has introduced a whole series of amendments to the Residential Tenancies Act and is now in force and effect.
Vanessa was invited to participate at “The Institute”, which is the Ontario Bar Association’s annual conference of continuing legal education. Her work was thorough and scholarly: she prepared a written paper for ready reference by other lawyers and she also delivered a presentation February 8. All of us at Anderson Adams gathered in our board room March 12 and shared a few pizzas while we watched the video clip of Vanessa’s presentation. Even though we know her well, we were impressed by how thoroughly professional and polished she was. (We wish we were permitted to attach that video link here too!). Since then, Vanessa has also received invitations to speak to real estate agents about these changes. They know it’s vital information when they are assisting purchasers and vendors of properties with residential rental units.
What are the key changes? There are significant new protections for tenants.
In the past a landlord could quite easily claim that a tenant needed to leave because the landlord wanted to make personal use of the tenant’s rental unit. But quite often the landlord did not move in. The regulations are much more stringent now. Tenants are better protected from arbitrary evictions.
Previously rent control didn’t apply to a lot of newer units. Now rent control has been expanded so that far fewer units are exempt. Landlords have far less freedom to raise rents. For many more units they will have to seek an order from the Landlord Tenant Board for any increase above the allowable annual rent increase. Massive increases in rent will be hard to get.
A major change is a new standardized lease with an enforcement date of April 30, 2018. This will be in a prescribed form and must be signed by all parties (landlord and tenants) before the tenants move in. Through the Ontario Bar Association, Vanessa had the opportunity to participate in the government consultation process which generated this new standardized lease. And these changes again afford more protection for tenants.
The standardized lease specifically states that a landlord cannot require that rental payments be received by automatic payments or post-dated cheques nor can a landlord demand a rental deposit of more than one month (if the tenancies is monthly or for a fixed term). Rights and responsibilities are set out much more clearly: for example, the new lease stipulates that a landlord cannot exclude pets or prohibit guests or additional occupants in the unit “up front” but only if problems arise because of the pets or guests or additional occupants.
If tenants or landlords need to appear before the Landlord Tenant Board to deal with disputes about unpaid rents or repairs or pets, very often they do so without lawyers. At Anderson Adams we’re happy to help if you need us with these disputes. But most often we would be retained to assist on a cost-effective limited scope retainer “in the background”, maybe drafting documents. Particularly when there is a significant amount of money at issue – such as damage to an expensive house that’s been rented out.
It’s from the perspective of our real estate clients looking for legal help with buying or selling that these Residential Tenancy Act changes are most significant. As a purchaser or as a vendor of a residential property with rental units, you want to know what to expect ahead of time and to avoid problems which can be costly.
Housing is expensive which means lots of purchasers need help with their mortgage payments. When purchasing and relying upon revenues from a rental unit to meet your financing obligations (whether in a house or condo situation), you will want to be sure that you are actually permitted to charge the rents you’re counting on.
If you are purchasing and planning on occupying one of those rental units yourself, you’ll want to be sure that the new “own use” provisions are fully satisfied.
And if you are the vendor of the property, obtaining the best possible price for your property means making sure you’ve complied with all the new provisions too: including use of that standardized lease.
Want to be on top of the changes to the Residential Tenancy Act that may affect your real estate transaction? Please contact Vanessa Playtis at Anderson Adams. She’s been in on the ground floor. Count on her to help you understand the impact of this new legislation on any real estate purchase or sale involving a residential rental unit.
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